business capital

capital purchases

Making Capital Purchases Like a Pro

When you’re making capital investment purchases, you’ll also use business finance to weigh the pros and cons of different repayment options. Let’s say you have a choice between a lower-interest loan with high monthly payment and a quick repayment period versus a higher-interest option with lower monthly payments over a longer period of time. Of course, a lower-interest option is the best option, provided you have the cash flow to pay for it.

Also, Read: How to Decide if How Much Business Financing Loan you Need

But if your cash flow is tight and the equipment upgrade will save you enough money to cover some added interest, you may actually decide that the option with higher interest and a lower monthly payment is better. Lower payments help cash flow, and good cash flow puts you in a position to take advantage of opportunities.

Also, Read: Why Working Capital Loan is Important for Small Business Success?

capital purchases

There is no set, reliable formula for evaluating all the costs and benefits of a long-term financing option. However, if you consider all the ways that a purchase will affect your income and expenses, you’ll probably make a better decision than if you focus on the interest rate alone.

Another variable that will affect the long-term costs and benefits of a purchase is the value of the money you spend and the way it changes due to inflation. When you make a loan payment in the future, you’ll use capital that is worth less than the capital you borrowed because inflation decreases the value of money over time.

Accountants and finance professionals use a formula called “return on investment” to calculate all of the quantifiable benefits that an investment will bring in over time and then compare these benefits with the total cost

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Related Articles:
What is Business Capital? How Does it Work?
Business 101: How does Equipment Financing Work?

inventory-loans

What is Inventory Loan and How it Works?

Inventory is required regardless of your business type or industry. Inventory rare required to run business, it could be items that you are selling or raw materials.

In order for you to provide better services or products for your customer better experience, inventory is a must. Having an inventory will allow you to expand your business operation. For you to achieve all this, you need to avail of a loan from a secured lending or financing company.

Are You Qualified?

Like any other form of financing, a credit score is necessary. You need to provide a list of what you need and how much it costs. Discuss your business plan, how it works so the lender can estimate how much you can borrow. Ensure that you are qualified. Most lenders will ask you to provide your bank statement, cash flow, personal credit score, business credit score, and any other financial details.

inventory financing

List of business Industries that can benefit from Inventory Loans

Restaurants will not be able to run daily operations without inventory such as ingredients, tables, and other food supplies.

Retail Store and Wholesale Store. You will be able to purchase a large number of stocks such as clothing, household items, and toys.

Need Inventory Financing?
We at JNA Financing, We can help you finance your business in order for you to become successful. For any questions, fill out this form.

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