Small businesses are the lifeblood of the British high street, but many are under significant financial pressure. Figures released by the government outline the situation – over 500,000 businesses will see increased business rates which are set to come into force in April. With the pressure on in terms of taxes, rates and the rising cost of goods, small businesses are looking for new ways to raise capital and keep the business booming.
There is plenty that can be done on the operational side of the business. Keeping your sales high through making your business digitally savvy is one way, and cutting overheads is another. However, sometimes you need a pure intake of capital – and there are modern, business-positive ways to achieve that.
Old rules, new implementation
Most businesses will rely on a business loan to get started, and further supplementary loans for ongoing support. The aftermath of the financial crisis saw banks reluctant to provide loans. However, statistics compiled by the British Bankers Association found that 8/10 SME loan applications were granted by banks. The liberalisation in lending habits has many sources, but with the government pressing growth, it’s likely banks are being encouraged to help out entrepreneurs.
What do you need to consider? As outlined by Crediful (https://www.crediful.com), credit checks are as important as ever – ensure yours is up to date and correct. Aside from that, technology helps your creditor to see your vision more clearly. Use your social media reach and develop SEO for your product – it’s easier than ever to exemplify a professional and hardworking business, away from brick and mortar.
Alternative sources of funding
The modern age has been marked by small business looking for alternative sources of funding. Without time-consuming and costly public campaigns, it was previously hard to raise funds from community or investment action. Now, with a surfeit of options available on the high street and the net, you can look elsewhere. You wouldn’t be alone – a February 2018 study by the British Business Bank found 70% of small business eschew banks in favour of alternative lending.
What constitutes alternative finance? One great example is peer-to-peer lending, which can be more ethical than bank loans. The same BBB report found a 51% increase in P2P lending over 2017. Another form is through patronage-style giving; this operates on a donation basis, with preferential products offered to those who pledge cash.
Liberalised lending has taken a very modern edge as businesses balance fiscal responsibility with the need for growth. Staying on top of your credit profile and maintaining a visible business plan is the ticket to obtaining finance. That aside, the web is making it possible for lenders of all shapes and sizes to help your business. Enjoy your options, and choose wisely.
