Depositphotos_83112920_s-2015.jpgWith fourth quarter in full swing and the holiday season looming ahead, many companies are ready to crank up and take business to the next level. However, there is one thing needed to make that happen—money. Companies small and large need access to cash if they want to achieve more during the holiday season and into the first quarter of the upcoming year. While there are may ways to obtain needed cash flow, there is one option that stands out from the others. Learn more about what a working capital program is, why it is superior to a bank loan, how such a program can help you achieve all your business goals in the fourth quarter and what you need to do to qualify for such a program.

What is Working Capital Anyway?
A working capital loan isn’t a traditional loan like you would use for a mortgage. It has the purpose of funding everyday operations and purchases. In fact, a working capital loan provides exactly what it sounds like it would—working capital or money to get through the regular work cycles. A company that has busy times of the year and slow periods of the year may need to utilize working capital loans to help smooth out the cycles and keep money flowing. 

Why is Working Capital Superior to a Bank Loan?
When you apply for a bank loan, you will need to have a particular purpose in mind for the funds. If you want approval, you will be using the money to purchase a major asset, such as a building or a vehicle. A bank loan is perfect for long term financing. However, if you need money for a short term—such as to buy extra inventory for the holidays or spruce up your building to prepare for the fourth quarter rush, you may not need to borrow money for a long time. Instead, you need a short term loan. Also, you may not be able to account down to the dollar, where the money you borrow will go. With a working capital loan, that is not a problem at all. In most cases, you receive approval for the loan no matter what it is being used for within the business. 
Working capital loans are also often unsecured. Utilizing an unsecured loan makes it easier to take out a loan quickly when the need strikes. Many businesses like to have a line of working capital available—then, when the need strikes it can be tapped into and utilized.

How Does Working Capital Benefit a Growing Business?
While borrowing money may seem scary, especially if you are trying to grow a business. Utilizing a working capital loan is a great way to help take your firm to the next level. Consider a few of the different ways you can use working capital as you build your business:
•    Obtain stock needed for the holiday season—to reduce the risk or running out during key dates.
•    Hire additional employees or allow employees to work extra hours to serve more customers.
•    Expand your warehouse space or rent an additional facility, so you can keep additional inventory in stock.
•    Ramp up marketing efforts during the crucial fourth quarter.
•    Start planning for the year ahead by obtaining inventory off-season.
•    Taking advantage of sales from your vendors.
These are just a few of the ways you can use working capital. As mentioned, you are not obligated to use the funds in any one particular method—you have flexibility.

What are the First Steps in Getting Qualified for a Working Capital Program?
In general, qualifying for a working capital program is easier than getting qualified for other types of small business loans. You may need to provide some basic information about your business, earnings, and current obligations, but qualifying usually only takes a short time. Your program coordinator will help you with the first steps and answer any questions you may have about the process so that you are more comfortable every step of the way.



Taking out any type of loan or getting cash advance for your firm is a big decision and not one that you should enter lightly. If you would like to learn more about our working capital program or find out if it is right for you, reach out to one of our experts today. We would love to show you how working capital has helped other firms large and small grow and achieve their goals in the ever-changing economy that drives the marketplace today.


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