Business Cash: Leveraging Current and Future Resources to Enhance Market Position

In case you’re wondering, there is no substitute for business cash. Of the myriad of resources, cash opens the most doors for start-ups and established brands to make moves in the market. Here’s why cash is everything, how to identify sources of business cash, and a little-known financing option that you never have to pay back (in the traditional sense of repayment, that is).

Why “Cash is King”
SmartCompany.com illustrates why business cash is so vital. A good measure of the strength of your business lies in its valuation. In other words, if you were to sell your business today, just how much would it be worth? To estimate this figure, financiers use a calculation based on a multiple of the businesses earnings before interest and tax (EBIT).

The problem is that too many businesses list a negative return at the end of the calculation. Why? Because cash flow does not consider human resources, equipment, or other assets traditionally weighed when judging the strength of a business.

Find the Cash in Your Business
Believe it or not, there might be several areas in your operations that can be optimized to increase your cash flow. Small Business Trends offers several suggestions for maximizing business cash and positioning your company for mobility.
1. Send Timely Invoices and Get Paid Sooner. The lag time between project completion and payment will eventually cost much more than the balance of the invoice
2. Foster Lucrative Affiliate Relationships. Partner with other businesses that offer complimentary products and services--increase the perceived value of your venture
3. Study Sales History, Identify Patterns. The unexamined business is not worth running; know your seasonal strengths and weaknesses and reverse them

Get to Know an MCA
The merchant cash advance. Financial backing in exchange for a portion of your future invoices or receipts. Perfect for seasonal businesses and far and away better than traditional loans. Merchant cash advance lenders study your sales history (remember those patterns you were supposed to find?) and will offer you an advance as a percentage of your average sales. Vendorseek says the merchant cash advance industry becoming increasingly viable, completed with governing bodies and best practices. An MCA is certainly a financing option to consider.