BusinessCash is adding a new type of financing service into its suite of tools to help companies access working capital. In a press release on Thursday (Dec. 3), BusinessCash announced the creation of an inventory financing program, which will use an array of credit assessment procedures.
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The company said that it will either purchase the inventory a business needs or will assess the creditworthiness of a business’ relationship with its supplier to predict the release of inventory in the future. The latter, BusinessCash said, will involve analyzing purchase order history.
In its announcement, the funding firm said inventory financing may offer entrepreneurs and startups a source of working capital they would otherwise not know was available to them. This kind of financing is especially useful to growing businesses that are suddenly met with an influx of orders but without the resources needed to carry them out.
BusinessCash added that inventory financing can provide a more cost-effective way for SMEs to gain capital, as opposed to selling equity.
Inventory was pinpointed as SMEs’ highest concern for the 2016 year, as well as for the holiday season, that can lead to overwhelming purchase order volume. A recent study by CAN Capital, released last month, found that inventory management is the top worry for more than half of SMEs surveyed.
The new product comes just weeks after BusinessCash introduced a separate service to its corporate customers. The firm now allows businesses to consolidate their stacked, short-term loans, a tool the company’s national sales manager, Chris Curtin, said could help SMEs exit a dangerous repayment cycle.
“Providing a vehicle to allow our clients to combine cash advances into one AR facility allows them to free up cash flow and get out of a difficult cycle of debt payments,” he said in a statement last month.