When it comes to working capital finance, there are a certain point or stage in the life cycle of every business when the facility becomes an inescapable, inevitable need for them. However, a person needs a very observant mind to analyze the situation and quickly take a conducive decision in favour of their business; which is not easy at all. The need can be determined by introspecting the situation based on three important questions: (1) Is there a need for additional financial support? (2) Is the urgency/financial shortfall difficult to manage even by liquidating a portion of the company’s short-term assets without posing a threat to its long-term financial health? (3) Is the company’s income sufficient to recover rapidly and repay the loan while making decent profits eventually? If the collective answer to all the three question is YES, the last thing you would want to do is avoid applying for a capital finance. To be more specific and clear, here are some common situations wherein your business needs to apply for the loan.
Also Read: When Your Small Business Needs Working Capital Loan
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AuthorAman Khanna is an experienced financial advisor who is well known for his ability to foretell the market trends as well as for his financial astuteness. He has an MBA in finance from Toronto University as well as years of experience delivering seminars on sound financial practices and debt management. |