Working Capital Management

by Stephen Bush

Business Financing Executive Summary

The following business cash advance guidelines are provided in this Working Capital Management Executive Summary:

• 5 reasons to consider a business cash advance based on credit card receivables factoring.
• 10 problems to avoid with business cash advances.
• 6 criteria for securing a business cash advance and working capital financing up to $300,000.

A Special Comment:

Banking Changes Which Have Impacted Short-Term Working Capital Financing

The recent chaos in business lending has changed how merchant cash advances and other short-term working capital financing options should be evaluated by business owners. There are several significant changes that make alternative working capital funding options essential for most businesses.

Here are three of the changes impacting the business financing climate for most business owners:

First, unsecured lines of credit are no longer readily available from most banks.

Second, most banks now require more collateral for commercial loans.

Third, many banks have discontinued most or all business finance programs.

Please note: AEX now offers new short-term commercial loan options (in addition to a business cash advance based on credit card processing) that can also effectively address the three key commercial finance change issues noted above — AEX has a short-term business funding program (typically up to one year) which should help business owners needing short-term working capital. Amounts funded through these short-term business loans are usually limited to a maximum of $100,000 (and not all businesses will qualify).

• Business cash advances are available to most businesses that accept credit cards in their business
  
• For most business owners, a business cash advance based on credit card processing and factoring is one of the few viable working capital management options for reliably obtaining short-term business financing
• Funds can be obtained quickly
• There is no need for collateral
• There should not be any up-front fees or closing costs

There are several key problems to be avoided with business cash advance programs.

• Up-front fees
• Collateral required
• Financial Statements required regardless of business cash advance amount, although larger merchant cash advances can involve additional information such as financials
• Fixed term to pay off the commercial financing
• Fixed payments to pay off the business cash advance
• High credit scores (frequently 680 to 700) required to qualify
• 12 to 24 months of $10,000 to $25,000 (or more) in credit card sales required
• Maximum business cash advance of $10,000 to $50,000
• 2-3 years or more in business required to qualify
• Closing costs

• Business accepts credit cards as a form of payment
• Ability to document credit card sales of $5000 or more per month for the last six months
• One year operating history as service or retail business
• No open tax liens, judgments or bankruptcies
• Acceptable personal and business credit (minimum personal credit scores of 500)
• If leasing: at least one year remaining on lease and in good standing with landlord

It is not necessary to accept ANY of the 10 problems listed above in order to obtain a business cash advance based on future credit card processing. AEX Commercial Financing Group has eliminated ALL of these potential problems from the Working Capital Financing Program for their clients. Here is an overview of our commercial finance program:

• No up-front fees or closing costs
• Business cash advances from $5000 to $300,000 (higher amounts also possible on a case-by-case basis)
  
• No collateral required
• No financials required for most situations (larger business cash advances will sometimes require additional information such as financials)
• No fixed payments - as goods and services are purchased, a small percentage of each credit card sale is collected from one of the processing banks
• No set term to pay off the business cash advance although there is a minimum of 90 days
• Easy 2-page application: AEX Commercial Financing Group can fax or email the application for its Working Capital Financing Program to you. This application will be requested only AFTER a discussion with AEX. Please note our policy provided below about avoiding the use of online business finance applications.

A borrower working with AEX Commercial Financing Group will not be asked to submit an application until they have completed a detailed discussion with AEX confirming that working capital financing is feasible for their particular business situation.

AEX Commercial Financing Group advises business owners NOT to complete an online commercial funding application.