What Are Asset-Based Loans?

Asset-based loans are generally offered by finance companies. They are provided on a revolving credit basis and secured against the assets of a company. Usually, accounts receivable and inventory are taken as collateral.

These types of loans are perfect for companies that are expanding rapidly or are undercapitalized. They can also be utilized for financing acquisitions. They work only in those cases where the company has a record of being able to turn over its inventory a number of times in a year and where the accounts receivable is proven.

Asset-based finance is offered by a huge number of funding companies as well as banks. However, the market is not so wide for small businesses who are looking for loans of $500,000 or lower. The majority of lenders prefer sanctioning loans of higher value as the cost of monitoring the loaned amount is the same, regardless of its value.

Asset-based funding is more expensive as compared to bank loans since asset-based lenders incur a higher expenditure than bankers. However, the pricing among lenders is fairly competitive. For a small business, asset-based borrowing may prove to be unaffordable as the rate of interest could be anything between 12 and 28 per cent.

It is simple to get an asset-based loan if your company has a good financial record, effective reporting systems, stable inventory and customers who are known to honor their commitments. Without these factors in place, it may be difficult trying to get this kind of finance.

Asset-based financing is however not restricted to just finance companies. Even suppliers can be considered a source of funds. If your sales cycle is longer than your accounts payable cycle, you may think of asking your suppliers to extend their payment terms. The other option is to simply pay your suppliers after 90 days. In many cases you will find you get three months of funding in this manner without actually paying any interest. You will be able to gauge if your strategy is effective if your suppliers do not stop shipments to you once your first invoice is older than 2 months. Another way you can make payments to your suppliers and get credit is to pay your suppliers after 35 days for a few months. If you see that your suppliers are not objecting, try stretching this to 44 days.

There is a high likelihood of this working since most accounts receivable collection systems point out those payments that have been pending for more than 45 days.… Read More

How to Make Money – Web 2.0 is the Future

Any online entrepreneur who has been having a difficult time determining how to make money should take a close look at Web 2.0. I fully understand that just seeing the term “Web 2.0” may create anxiety due to the fact that it signifies something new, something cutting edge. Without the proper understanding, article marketing, social bookmarking, video marketing, podcasting, or whatever it may be might confuse and frustrate individuals to the point that they are unwilling to recognize that these tools can do for them. As a result, I am going to attempt to explain just a few of the benefits of Web 2.0 without overwhelming you.

The following will discuss three of the most valuable aspects of Web 2.0 to those who utilize as an online marketing tool. As an online marketer, you want to get your message to a large yet targeted audience as quickly as possible. The following will provide you with that stage.

1. Providing Tags for Compositions

A “tag” is simply a keyword which is attached to a composition. Therefore, if you create a video on a particular topic, you would tag the video with keywords relevant to the topic of discussion so that others can find it by searching for those keywords. As you may have guessed, other compositions can be tagged as well, such as blog posts and articles.

2. Acting in Unison

I am sure that you have read an article before which has received a large number of “Diggs” or which has been “Buzzed Up”. A large part of the reason why you came across such an article is because others have propped it up and made it relevant. Once enough people click on the link, and recommend that others also read the article, it gains credibility with the search engines, and is often a feature story. Just imagine if this happened to one of your articles. Were this to happen, the exposure which your internet business would receive would go through the roof. The good news is that even if your article does gain such attention, you can still benefit from one which does. Simply provide a compelling comment on the article, and add your link.

3. The Syndication of Your Compositions

Perhaps you have heard of article directories. These article directories are composed of a myriad of categories, often populated by thousands of articles. Such directories enable a website owner to select articles which are relevant to their website, and publish them. This is what is known as syndication. Syndication is a great think for the online marketer. The more articles which you have on other webmaster’s websites with a link pointing back to your website, the more exposure for your online business. Conversely, if you already have a readership, and need frequently updated content on your website or blog, syndication is your answer.

Web 2.0 is gaining more popularity with more and more individuals realizing its importance to their discovering how to make money on the … Read More