One of the basic mantras of business success is the steady infusion of finance. For businesses, getting the timing for funding right is crucial to the success of a venture. With the recent boom in the MSME sector in India, small business loans have emerged as the financing mode of choice for many business owners. With features like quick approval, no requirement of collateral, and online account access, they are tailor-made to fulfill the requirements of small businesses.
Read on to know the best time to get a business loan.
When expansion is imminent
It is important to note that in the changing economic scenario of India, small businesses have ample opportunities to expand. For this, a business owner should have adequate financial resources. Companies like Bajaj Finserv are offering small business loans to address a wide spectrum of requirements, including expansion of business operations.
Economic opportunity
Cashing in on the right opportunity presented by economic situations reflects business prudence. For instance, demonetisation saw a surge in digital payments. As expected, several firms took the opportunity and invested in upgrading their financial transactions to digital mode, offering discounts and coupons for orders placed and paid for digitally. As this led to an increase in business for many of these firms, they required a corresponding increase in their working capital so that they could keep up with the market’s demands.
Infusion of talent
In his book, Good to Great: Why Some Companies Make the Leap... and Others Don’t, Jim Collins has said, "Great vision without great people is irrelevant."The success of a business depends on its workforce. Business owners need to infuse new talent in their existing pool of resources, time and again, to remain competitive.
Successful businesses invest consistently in acquiring talent and upskilling the existing workforce. With growing relevance of new technologies like Big Data and analytics, business owners need to recruit expert personnel in these fields to stay competitive in the market.
Buying fresh stock
Sustaining a business in the current digital ecosystem requires an optimum inventory level. While being overstocked is not recommended, business owners should have enough funds at their disposal to invest in fresh inventory when the market conditions are right.
With collateral-free small business loans, business owners can buy new inventory ahead of a busy season. This will help them adequately stock up to meet customer needs.
Additional read: Impact of GST on working capital for businesses
Technological upgrade
A modern business thrives on technology. Business owners need to be on a continuous lookout for new equipment and systems to stay technologically competitive. For example, we are witnessing a shift towards automation of business processes.
But these upgrades are costly. Often, businesses need to avail loans to fulfill their needs for upgrades. Small business loans give business owners the funds to fulfill their technological needs.
Research and development
The product and service space of the modern economy is very dynamic. New products and services are increasingly replacing old ones. So, to cater to changing customer needs and preferences, a modern business needs to invest significantly in research to develop innovative product and service offerings. A small business loan may help substantially in funding such research projects for businesses.
As a business owner, a small business loan should take care of your future financial worries. These tips will ensure that you get a loan for your business at the right time.
Additional read: What is GST?
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