How To Finance Business Growth

]For business owners, there are many types of finance options available to grow your business. We understand at White Oak the importance of providing capital to help small businesses and mid-corporates grow through the business finance products that we offer.

Business growth finance can be used in various ways, whether that’s to expand your workforce, increase turnover or purchase new equipment. It’s crucial that you have a long-term business plan, which will increase the likelihood of getting investment for your business.

We have put together a guide that will take you through the options, as well as their pros and cons, which will help you make an informed decision on financing your business’ growth.

How do you finance business growth?

When it comes to the question of how you finance business growth, there are many ways of doing this. Whether you decide to go down the investor route through angel investors or venture capital or the borrowing option with bank loans and small business loans, it’s dependent on how well your business is doing.

Having that business plan is crucial to ensuring that the growth plans you have lined up for your business are achievable in the long run. It’ll ensure that you can access the funding that can supercharge your business to the next level, while also finding the funding option that’s right for you.

Options for financing business growth

There are plenty of options available as a business owner for financing the growth of your enterprise. Whatever option you choose, it’ll ensure that you can fund your business while not having to go through the painful process of filling out a business bank loan application from one of the high street banks.

It can be hard to pick the right funding option to finance your business. We have chosen a few financing options that will help grow your business, as well as highlighting the pros and cons of using that finance option as a business owner.

Asset Finance

If you are a business that lacks the cash needed to grow your business, asset finance can be useful in accessing important business assets without buying them upfront. There are three different types of asset finance, which includes finance lease, hire purchase and sale and leaseback.

Asset finance can be used in many ways, whether that’s financing a fleet of vehicles or getting access to the latest equipment. The pros of using asset finance to grow your business is that it can unlock capital that can be used in other areas of your business, as well as being able to spread the cost of the asset overtime.

The cons of using asset finance for business growth is that your provider can repossess the asset if you fail to keep up-to-date with your payments. Also, there are limits on how you use your equipment, as if you go beyond the contracted limit you could end up with a big bill to pay at the end of the contract.

Invoice Finance

Invoice finance is a great option for financing business growth as it allows businesses to improve their cash flow by releasing funds tied up in invoices. The two most common types of invoice finance used for financing business growth are invoice factoring and invoice discounting.

The pros of using invoice finance is it can provide your business with a steady cash flow, which is great for seasonal businesses. This means that you are able to access the funds raised through invoice financing quickly, which can be used to upgrade equipment and machinery for your business.

When it comes to the cons of invoice finance, it’s primarily due to the fact that it solves the issue of having a poor cash flow. It’s also not the cheapest type of finance available to grow your business, which means that when raising capital for your business, it must come specifically from business customers you have worked with.

Conclusion

There’s no shortage of options available for business owners to finance the growth of their business. It all comes down to choosing the right type of business finance that’ll help grow your enterprise in the industry that it is operating in.

White Oak has business development loans that can help finance your business’ growth. Whether you decide to borrow £25,000 or £2m, we have flexible repayment options that are tailored to your needs.

If you want to learn more about how we can help finance your business’ growth, speak to our business finance expert who can help you find the funding that’s right for your business.

Talk to us

If you are looking to find the right finance for your business, contact us today.

Get in touch

Enjoying these articles?

Subscribe to our insights newsletter.