5 Reasons Small Businesses Should Think ‘Outside-the-Box’ When it Comes to Their Financing Options
*This post is from CMB partner Essex Lease. Visit them for flexible lending solutions.
At Essex Lease Financial, we hear time and time again from business owners who are frustrated with their bank.
Whether experiencing a lack of trust, navigating endless bureaucracy, or dealing with inflexible lending terms, many business owners feel that working with a bank often comes at the cost of their autonomy and control. Sometimes even from bankers who know nothing about their industry or business model.
The truth is traditional banks have never really been designed to serve the needs of small business owners. But banks aren’t the only option your business has.
Let’s look at how a more flexible, creative approach to lending and financing can help your business achieve its goals.
1. A Lending Partner That Works With You (Not Against You)
The unfortunate reality is that for many businesses encountering financial difficulties, a bank will automatically go into defensive mode. Their priority is protecting their assets – not working with you to overcome challenges. Working with a lending partner that takes the time to understand your business and prioritizes flexible solutions is essential to weathering the inevitable difficult times. Trust is vital in any lending relationship. If a business owner can’t trust a bank to be on their side through the good times and bad, it may be time to look elsewhere for your financing needs.
2. Business Cycles Aren’t Always Consistent-and Your Financing Needs to Respond Accordingly
If COVID-19 has taught us anything, it’s that business owners need to be prepared to expect the unexpected. A flexible financing partner can help you respond to fluctuations in your industry that allow you to navigate even the most unexpected challenges.
3. Flexibility to Put Your Assets to Work For You
A flexible financing partner who thinks outside the box can help your business find ways to unlock working capital through your existing assets. Tools like asset-based lending can be essential for businesses to help manage cash flow challenges, but it requires a personalized, custom approach from your lending partner.
4. A Holistic View of Your Business
Banks tend to be rigid when it comes to making lending decisions. They are typically ‘lending by looking backwards,’ only considering a narrow range of information like past financial statements or financial covenants. But such a limited approach rarely tells the full story. A flexible financial partner will look beyond the numbers to understand the potential behind your business.
5. The Agility to Respond to Opportunities Quickly
In business, time is money, but banks are often too slow to help a business respond to opportunities in a timely way. With a flexible lending partner, there is less ‘red-tape’ to deal with, which means a business can get financing decisions quickly, allowing you to seize on an opportunity before it’s too late. Banks also tend to be extremely risk-averse when it comes to providing financing for new assets, especially if the asset is something they aren’t familiar with. Even if your business is poised for growth, getting the financing you need to take advantage of an opportunity can be difficult. A flexible lending partner will instead look at your business as a whole and think outside the box about the potential the asset could unlock.
At Essex Lease Financial, we pride ourselves on thinking ‘outside-the-box’ for our customers by creating custom solutions that reflect their needs. We help businesses navigate challenges and respond to opportunities with creative, experienced advice tailored to their business cycles.
If you’re ready to work with the financing experts that offer exceptional services, and a dedicated, personal touch, contact Essex today to get started!