You’re a business owner and cash hasn’t been a problem, but delinquent customers have put you in a bind and you don’t know if you can meet the payroll. If you find yourself in a cash crisis there are ways to generate the money you need. Whether you turn to your bank, sell off some assets, or be more creative by selling debt, you can get the cash you need to keep going.


Look for a Loan

Bank loans are the traditional route for raising quick cash, but many banks require you to put up real collateral. Plus, another long-term debt with high-interest rates is not what you want. If you have a good relationship with your bank ask for a line of credit instead. It works like a credit card, you only take what you need and the bank only charges interest on what you spend. If that doesn’t work out, don’t despair.

Search the Internet, there are many good lenders able to make short-term working capital loans. These loans cover your everyday expenses, like payroll, without the restrictions of traditional bank loans. Working capital loan considers your assets versus liabilities. It also takes into account future earnings from your clients or customers. Working capital loans are short-term loans and include account receivable credit lines, inventory loans, or bank lines of credit.

A working capital loan ties to assets that quickly convert to cash, such as selling off inventory or equipment. The working capital loan offers flexibility, varying interest rates, and easy repayment terms. Look to a company like that offers working capital loans. The entire transaction is online, plus looks at your real-time business data to make its decision.


Factoring Your Accounts Receivable

Is a large amount of money tied up in your accounts receivable? Factoring allows you to get cash now and use the receivables as collateral. In other words, you sell unpaid debts for cash. An investor or bank offers to take over your outstanding balances, minus a small discount and gives you the money you need now. Once the balances come in, the money goes to the lender and you are paid off. This type of funding works well for business dealing with a lot of credit payments.


Investing in Equity Funding

If you are a new business without an established credit history, equity funding could be a viable option. In this situation, investors offer you cash in return for a piece of the profits later. Even friends and family can be an investor. Once again, the Internet is a perfect source to find investors. You can increase your cash flow now and not worry about paying back a loan with interest.


Adjusting Your Business Practices

If you find yourself in a cash crunch often, maybe you need to renegotiate your own payment terms to ease the strain. Talk to your vendors and ask if they are willing to take a net-45 or net-60-day basis instead of a net-30. This will give you time to collect income before having to pay suppliers. You may also want to look at your spending and cut back on any unnecessary items until your cash flow is better. Offering a discount to customers who pay in cash can also help in a crunch.

When working through a cash crunch, you need to take a very close look at what you’re spending. Examine your expenses and see if there are items that you can hold off on until your cash flow increases. Maybe drop recurring subscription services or order less inventory until your financial situation improves. If your sales are down, you don’t need extra stock sitting around.


Adjust Your Pricing Structure

Raising your prices is a necessary part of a business and it is something to consider during a cash crisis. Be careful not to raise prices arbitrarily though. Take a good look at your supply and inventory cost compared to what you’re charging. If it has been a while since you raised prices or your prices, compared to the competition, are considerably lower, there is room for a little adjustment. Be careful not to raise prices so much that you drive away customers.

Look ahead to avoid any future cash flow problems. A cash flow analysis is an effective way to spot trouble before it becomes a crisis. By looking at your numbers monthly you will see the ebb and flow more readily and be able to adjust for the future.

Almost every business will hit a cash crisis now and then. Sometimes economic factors beyond your control can make it difficult to meet you daily obligations. But don’t despair, there are ways to help you steer through the tough times without having to sell valuable assets or put up large value collateral such as your home.

Laura Jane College is a copywriter, content marketer, and storyteller who specializes in business and finance. She believes that every brand has a unique story, and she strives to tell it in the most compelling way possible.