Running a local retail business in the UK already comes with enough challenges. There are the costs of finding suitable premises, hiring qualified and reliable staff and establishing a presence in a crowded marketplace. But there is one issue facing smaller, more local businesses in the UK that is perhaps even more difficult to overcome: managing cash flow.
For many SMEs, unexpected costs and every day operations can quickly drain available cash flow, leaving the business without the capital to operate and function effectively. It can lead to payroll issues, missed payments, lost growth opportunities and more. All of which explains why more and more small businesses are turning to same day business loans to get access to the fast funding they need. But just what are these business loans for retailers and what benefits do they bring?
The Need For Fast Finance
Smaller local businesses, especially those in retail, often need access to cash at short notice. But when sales are not great due to the wider economic circumstances or seasonal drop offs then this can cause a real strain. In recent years, the British Retail Consortium has reported a decline of 3.6 % in retail sales, which is really applying cash flow pressure to local businesses. These kinds of fluctuating revenue streams often leave business owners in urgent need of fast financing options. Traditional loans and lenders often take several weeks for approval and loan payment, by which time it may be too late for some local businesses.
Another major complication is late payments. The Federation of Small Business estimates small businesses are owed around £23 billion in unpaid invoices. With this amount of money currently not available, it’s little wonder business loans are a pivotal tool used to keep businesses running.
The Benefits Of Same Day Funding
The main advantage is obviously the speed of funding. If you have urgent expenses to cover, such as seasonal inventory, rent and bills, staff wages or more, then you need access to quick capital in order to meet them. Having loans applied for and funds available within 24 hours gives businesses the flexibility and agility to keep things moving.
The more open eligibility criteria is another major benefit. Local businesses don't always have the credit history or collateral to secure funding from traditional lenders. A same day business loan is therefore a great choice for businesses that have a limited credit history or prior financial difficulties. With around half of all small businesses in the UK struggling to obtain finance in more strict lending conditions, this kind of eligibility is crucial.
Around one in five small businesses in the UK closes within the first year due to cash flow issues according to the Office for National Statistics. Securing a bank loan for business retailers ensures they have enough working capital to keep going, even during slow sales periods or when unexpected costs arise.
The lack of a long term debt commitment is also a major advantage, with same day loan repayment periods generally being much shorter and more flexible. This allows local businesses to structure repayments in more favourable ways.
Find out more about the benefits of same day business loans by talking to the team at Century Business Finance today!
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