In times of recession, entrepreneurs have a tough time maintaining constant cash flow in their businesses. These proprietors sometimes have to curtail their operations and abandon expansion projects. This is because they don’t have the money to implement them. Many people may argue that these proprietors can easily take out loans from commercial banks. However, they fail to realize this mode of finance is often very difficult to avail. Lenders offering the funds often lay down stringent eligibility requirements. It’s not always easy for these owners to fulfill such guidelines. On top of this, it takes a long time for them to get the amount they need. This is why prominent experts suggest they should opt for asset-based lending schemes.
Arnon Dror Creo Americas – Is it worthwhile for entrepreneurs to avail asset-based lending schemes?
Arnon Dror is among very few financial executives to stand out the world of international business. The Hebrew University MBA graduate has more than 2 decades of experience under his belt. He also has the distinction of discharging the office of Vice President in many companies. Scitex, Creo Americas, Kodak, Creo Inc. and Xerox are just a few of these corporate enterprises. The officials of each of this establishment are grateful for his services. They consider him to be the architect behind their concerns’ transformation in profit-making entities. They say his track-record in the area of internal reconstruction is very impressive. Many of them even admit he specializes in many diverse fields. These include internal control, cash flow management, strategic planning, international taxation, ERP integration, and corporate merger.
The Arnon Dror Creo Americas team of specialists say entrepreneurs first need to know how asset-based lending schemes work. On the can they take a decision on whether such facilities are suitable for them. In this mode of finance, they enter into an arrangement with a reliable service provider. This financier takes steps to evaluate the market and intrinsic values of assets of these businessmen. These could be in the form of equipment, account receivables, or inventory. For this, the lenders employ an appraiser. Once this is over, they provide these businessmen with the sum of money they need. They keep the assets as collateral until the owners repay their dues.
The professionals point out the following 2 important benefits of this mode of finance for entrepreneur
1. Low-interest rate
Financier offering asset-based lending facilities charge a nominal rate of interest for the sums they lend. This is boon for entrepreneurs looking for a cost-effective mode of finance to run their businesses. It’s a far cry from traditional commercial loans. The lenders are generally confident that their clients are going to repay their dues on time. Otherwise, they simply forfeit their assets.
2. Instant source of money
Entrepreneurs understand that sanctioning traditional commercial loans is a time-consuming process. These proprietors often don’t get the funds they need on time. This can hamper its commercial operations. However, this is not the case with asset-based lending schemes.
The Arnon Dror International team of professionals clarify the asset-based lending schemes can work wonders for entrepreneurs. They just need to look at the above 2 important advantages of opting for this mode of finance. The proprietor will know it is the right decision to take to streamline their business’ cash flow.