When you run a business, you’re bound to have unexpected expenses come up. If you don’t have money set aside in savings, a bump in the road could turn into a major hurdle. How would you handle needing to replace equipment or covering payroll when your clients haven’t paid their invoices?
These are just a few examples of when a working capital loan comes in handy. Rather than taking out a one-time, large loan, a working capital loan provides – you guessed it – working capital to help you cover day-to-day expenses.
But is this type of financing right for you? Ask yourself these questions to find out.
Why Do I Need Money?
If your answer is “because my business isn’t making any,” a working capital loan might not be a good fit. A loan is not necessarily the best way to save your business if it’s failing.
On the other hand, if you just need to cover a temporary cash crunch, a working capital loan can be ideal. Here are some situations that are great for this type of loan:
- Covering payroll until you get paid by customers
- Buying inventory in bulk to prepare for a busy season
- Taking care of unexpected expenses
- Expanding or moving into new space
- Upgrading your equipment
Kabbage offers working capital loans available through revolving lines of credit....