Your business is going along great. Sure funds are a little tight, but you know it is just because you are in a growth phase and you’re willing to ride that out because you’re gaining new customers every day. You have a full coffer of orders. What could go wrong? Suddenly, your equipment fails and you don’t know how you’ll fulfill those orders, get paid, and keep going. Fortunately, an MCA can help with emergency equipment replacement when you need it most.
Why an MCA Over a Loan?
More than likely, you either already took out a small business loan to start your business or your business isn’t yet viable enough on paper to qualify you for a loan from a traditional lending institution.
That’s where a merchant cash advance can fill the gap. The MCA is based on future debit and credit card sales. If you already have those orders and they simply need to be filled, then you are the perfect candidate for an MCA.
An MCA can also be obtained with far less paperwork and in a shorter period of time than a loan. Instead of waiting weeks for an answer that may be no, you’ll have your MCA funds in as little as 10 days.
Others Ways an MCA Helps
There are many other ways an MCA can help your business when you have to replace equipment without any advance notice. Perhaps you planned ahead and had enough funds to keep your business running smoothly for the next six months, but you simply didn’t plan for the equipment to fail so quickly.
While you may have had the funds to cover the replacement, you may quickly find yourself with a cash flow issue without that buffer in your account to cover costs. An MCA is one solution to this problem until you’re able to replace the funds you had to use to buy new equipment.
There are also times when your business grows so fast that you don’t necessarily need to replace equipment so much as duplicate it. For example, if you’re making a gadget and you suddenly get a large order from a national chain department store, you’ll need to double or even triple your production to meet that order.
However, the merchant won’t pay you until 30 days after delivery. A merchant cash advance can help get you past that hump and let you deliver on time and in a professional manner without losing that big box client.
The next time your equipment fails or you have an emergency, don’t panic. Know that there are options to get you through these hurdles and keep your business going.
Disclaimer: A merchant cash advance is the purchase of future credit card or debit card sales and is not a loan product.