Academy
July 8, 2022
9
min read

The Top 3 Benefits of Business Capital

These three picks will scale your business quickly when done right.
The Top 3 Benefits of Business CapitalThe Top 3 Benefits of Business Capital

Did you know that business capital includes several more than business loans?

If not, that’s perfectly understandable, especially if you have a new business. 

However, now you may be looking to secure business capital in order to increase cash flow to better manage and grow your business long-term. 

But before you can begin exploring how to secure business capital, it’s important that you are aware of the various types of business capital that you can gain access to. 

Quite simply, business capital is the money a business has on hand to pay for operating expenses. 

Examples include; lines of credit, vendor credit, business credit cards, and loans. 

Now that you’re in the loop about the types of business capital that may be available to you, we have identified the top three benefits of using business capital.  

While we are sure that you are familiar with the most popular benefits of getting loans such as; being able to buy inventory, equipment, or supplies. We want you to be informed about three benefits that are often overlooked.

We also stand behind our belief that these three benefits are the ones you need to be in the know about the most in order to have a successful business in the present and the future. 

Let’s dive into the top three benefits of business loans for entrepreneurs:

One: You can quickly gain vendor credit 

One of the easiest types of capital that entrepreneurs can get is vendor credit. Even new business owners can receive vendor credit if they meet a baseline of qualifications such as having a registered business and a business bank account. 

Vendor credit accounts allow you to get items that you need to run your business with retail vendors. Small business owners commonly use vendor credit to purchase office supplies. Most vendor credit terms require you to pay your balance every 30 days, which is often referred to as Net-30. 

Using vendor credit is also another way that you can build your business credit as an entrepreneur. Timely payments on your vendor account are also reported to business credit agencies. 

Two: You can obtain a secured business credit card to build business credit 

Secured business credit cards are not discussed nearly as much as they should be among small business owners. That is more likely a result of far too many entrepreneurs not even being aware that secured business credit cards exist. 

However, this is a top benefit of business capital that you can take advantage of as an entrepreneur. A secured credit card poses very little risk to you and credit card companies because it requires you to pay a deposit to secure a card. That deposit serves as a credit card company's insurance if you are not able to pay off your balance. 

A secured credit card will help to build your business credit as well. Making every payment on time and never maxing out your limit will keep your credit in good standing and it will also prepare you to receive an unsecured credit card as your credit score improves. 

Our business credit monitoring service is a savvy resource that you can use to help ensure that your credit stays in good standing. We report our members' business credit reports to Equifax and CreditSafe every month. 

CLICK HERE to learn more about our business credit monitoring service. 

Three: You can develop a strong relationship with lenders

Building trust should be a building block for your business, not just with your customers or clients, and vendors, but also with your lenders.

The more you demonstrate your ability to pay your debts on time, the easier it will be for you to return to lenders time and time again when you need a business loan as an entrepreneur. 

This strategy alone could prove to be your most valuable asset when it comes to scaling up your business. Businesses are built on relationships, and entrepreneurs must take heed to that from day one. Strong relationships will lead you to the people that can expose you to additional resources such as loans, capital, and even knowledge. Solid business relationships can be priceless in the long run. 

Are you taking advantage of relationship building in your business right now?

A quick note about the disadvantages of securing business capital:

One of the biggest ways that entrepreneurs often get into trouble is by securing more capital than they actually need or can comfortably afford to repay. Doing so is a quick route to insurmountable business debt that may be difficult to resolve in a timely manner.

A few key questions to ask yourself  when seeking business capital include: 

Does my business have steady revenue, month after month? 

Does my business have the potential for long-term growth (it is in a growth market or stagnant market)? 

Do I have access to alternative funding sources before seeking capital for my business? 

If you can confidently answer yes to the questions above then you are more likely a solid candidate for seeking business capital. 

To sum these ideas up, the top three benefits of securing business capital are; gaining vendor credit, using a secured business credit card, and building a relationship with a lender. 

When you break down all three it is easy to see just how much you can use business capital to scale up your business in more ways than you may have initially imagined. A successful entrepreneur thrives when they have a solid knowledge base of how to manage their business effectively and when they have access to key resources such as capital and credit monitoring. 

About Synture

At Synture, we have found that entrepreneurs struggle with confidence, fully understanding business management and fears around cash flow and credit. That’s why we have our signature online Synture Business Academy, which works with small business owners, just like you, that need guidance and resources to get past their roadblocks. 

We have an affordable monthly membership model, where entrepreneurs can select a tier that best meets their business needs. Each tier includes access to our business academy where you learn about the pillars of business success, with modules on business credit as well. 

Now is the perfect time to take the leap, invest in your business (and yourself), and discover how Synture can serve as the business partner that you need in order to accelerate your business growth. 

Join our free webinar to learn the ins and outs of our membership program! 

We can’t wait to be a partner in your success! 

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