Lots of money but always broke

From Heath Nichols, Boca Raton, FL

With our current credit crunch, rising cost of goods and gas prices, companies who deliver products and services are finding it harder and harder to collect in a timely fashion from their clientele everyday. As a rule of thumb in business, you want to set yourself up ahead of time to have access to funds so that your company's productivity doesn't suffer simply because the money isn't there. Typical banking usually will lend in a good situation as opposed to lending to something that appears to be too risky. Predicting your cash flow with tools such as Quicken on a "worst case" basis, will show you what may happen, should your receivables turn from 30 days paid to 60's or 90's. So, setting yourself up with accessible credit or setting aside cash will smooth out the rough times, so that you can run your business effectively. While there are multiple ways to finance companies, your most effective would most likely be an unsecured business line of credit, which some banks offer, which is there when you need it and doesn't force you to make payments when you don't. Most competitive banks offer prime plus two to prime plus five percent, on a five to seven year term, which keeps your payments very affordable. Since most unsecured business lines come with a high personal credit score requirement, make sure your credit is in the area of a 680 or more before applying. You will want to use a reliable source to view your credit, such as TrueCredit.com so you can be sure you are not looking at a consumer banking report. Consumer reports are generally used by credit card companies and secured financing, but rarely used by large banking institutions for unsecured business credit. Doing some work before applying will greatly increase your chances of getting approved for what you need!

From Susan, Atlanta, Georgia

Even businesses who track their cash flow meticulously have to deal with cash bottlenecks. One solution is facotring, or the sale of your B-to-B invoices. Most small businesses don't need ten's of thousands of dollars. That's were micro factors, like us (Catham Holdings) come in. We provide the cash you need short term, you don't add to debt because we purchase an asset – and your employees get paid, or you can take advantage of your supplier's payment rebates, or buy a new piece of equipment. IT's a great way to grow a business.