Private Lending: An Effective Solution for Dealing With Supply Chain Jams
The repercussions of Covid-19 have had a huge impact on the availability of materials, transportation, and labor spanning across virtually every industry. According to a survey by Ernst & Young LLP (EY US), 97% of participants who included industrial products companies and automotive industries admitted that the pandemic brought negative impacts with 47% of all firms having their labor force disrupted.
This has also had a profound slowdown in business opportunities and receivables for many different types of businesses. It is no secret that the pandemic has had a sweeping effect across all industries and countries with closed borders and airspace and national lockdowns.
In 2020, the world experienced one of the largest declines in global trade by 8.9% since the global financial crisis. This means countries could also not access essential goods such as pharmaceuticals from China, which is the major global source of pharmaceutical ingredients, which in turn limited India’s access to raw materials for generic drugs.
The majority of companies, including small and medium-sized companies, have had to face the negative effects of supply and demand. Construction companies can’t complete work due to lack of materials, logistics companies have slowed down until materials become available, and staffing companies are dealing with a slow return of workers to jobs. As a whole, the pandemic placed major constraints on regional and international supply chain businesses.
As a result, these companies are struggling and often need a financial bridge to keep up with payroll, inventory, bills, and production, to name but a few. Admittedly, small and medium-sized businesses are much more likely to be impacted by the negative effects of the pandemic than larger companies.
As companies are working to get back to the norm, they are facing a challenge in accessing funds to restock their materials, rehire and retrain their staff, and revamp their business strategies. However, this gives space for private lending, which offers a great opportunity and hope for businesses that can’t access bank loans. This has led to an influx of private lenders which allows business owners access to multiple funding options depending on their needs.
This would be an opportune time to work with MobyCap as we have assisted many businesses in different industries to access much-needed capital to smoothly run their supply chain operations.
Why Seek Private Lending With MobyCap
1. We Give Priority to Our Customers’ Needs and Goals
Private lenders like MobyCap look at the historical performance of the business and understand short-term slowdowns related to these types of issues. This acts as a guide to identifying the right type of funding with favorable rates and terms. We understand any downturn in business can seriously affect credit scores. Our business funding options are popular among customers because they can still have access even with bad credit. In addition, consistent payments will help rebuild a bad credit score.
If a merchant needs to raise funds within a couple of days to scale up production or add to their staff, we make it a priority to secure the funds they need on their timeline. This would be an impossibility for a bank as it would demand security. We aim to ensure there is no shortfall in capital as our customers carry out day-to-day business operations.
2. We Care About Building a Relationship With Our Customers
We also work closely with each of our customers to gain a deep understanding of their businesses and aspirations for the future as well as how they are coping with current challenges, rather than simply plugging numbers into an algorithm and spitting out an offer or a decline.
It is important to have a relationship with a lender from the get-go, which is what we aim for. Qualities such as transparency, flexibility, competitive rates, and a good reputation are what to look for in a good private lender.
We will not just offer to fund the business, but we will examine any gap in our client’s supply chain operations. If, for instance, they are facing a production shortage, we will help them devise a plan on how to improve, such as purchasing equipment, so they can ultimately meet customer demands. We value keeping trust given the unpredictability of the current economy.
3. We Provide Quick and Easy Access to Funding
We require minimal documents and can have tangible offers for our customers within a couple of hours of receiving the necessary paperwork. We understand that time is of the essence. That is why we have an easy application process so that more businesses can access loans. This is unlike traditional bank loans, which tend to have a complicated application and approval process which easily locks out small businesses.
With our funding options, such as merchant cash advance and invoice factoring, clients do not need to submit collateral. We also offer a business line of credit where once the customer is qualified they can apply in the future without going through another approval process. This can be useful in case an unexpected business emergency arises.
4. We Provide an Adequate Lending Limit
We can also fund same-day loans up to $250k and amounts up to $5 million within 72 hours because we know our customers need to focus on navigating through these supply chain challenges. We want our customers to keep working on their short-term and long-term recovery plans. The current pandemic caused significant supply and demand shocks, leading to many businesses closing shop.
With our generous same-day funding offer, our clients can access a sufficient amount to cover needs such as logistics, cash flow, hire of extra labor, and inventory. Even better, it does not give too much priority to credit scores and does not place limiting restrictions. Our customers also do not have to worry about unexpected fees and hidden charges, allowing them to focus on building their businesses.
5. We Offer Tailor-Made Business Funding
We customize solutions to our customers’ unique needs and can even modify their payments until business ramps up, which most of our competitors cannot do. Customized business funding offers great benefits for any business seeking funding. This is especially valuable to small and medium-sized companies as they operate on a different blueprint from larger organizations. In addition, many of these businesses might overlook the risks of some business funding further adding to their operational risks.
Our funding experts are qualified and experienced to sit down and help customers figure out which specific funding will solve their problems. In case a customer settles on merchant cash advance, they will benefit from the flexible repayment schedule, which is especially beneficial for seasonal businesses. In addition, our customers will not be tied down to fixed high interest rates which could affect their cash flow.
6. We Reward Our Customers With Attractive Offers
We can also offer aggressive early payoff incentives that reward our customers for paying off their balances early, rather than penalizing them as some traditional lenders would do. This can be a great boost to any business working on recovering or improving its supply chain operations. It eliminates worrying about any default in payments that could put great risk on the assets and interrupt the cash flow.
It may take some time before companies and industries all over the world overcome the disruptions in the supply chain. While some companies will likely recover quickly, not all businesses are equal. It would pay for governments and industries to always prepare by coming up with a solid recovery plan as the economy can be uncertain.
However, this is expected to be capital intensive in terms of strengthening the production and distribution channels, investing in technology, and better logistics. One of the recommendations is that governments need to perform stress testing supply chains to help easily rise from any unexpected changes.
Even as the global supply chain continues to find its way back, funding is also a critical concern. With funding, businesses can rebuild their operations to their original or improved capacity. Private lending offers a beneficial alternative, especially for small and medium-sized businesses.
With the current economy, all kinds of lenders are clamoring for the attention of businesses, more so small and medium-sized entities. Banks are no longer the next stop as they tend to shy away from small businesses. It is best to conduct due diligence to ensure the business chooses the right lender. At the end of the day, every business wants to be able to refinance their loans and protect their autonomy.
MobyCap has a proven track record of success as revealed by our satisfied customers. We have worked with many businesses operating in different industries, each one with unique challenges and needs. We want our customers to always view us as a reliable and trustworthy partner when they face any challenges in their businesses. We offer straightforward terms and rates with our varied funding options. Please feel free to contact us today to get started.