Funding For Start-Ups and Small Businesses

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Funding For Start-Ups and Small Businesses

Funding For Start-Ups and Small Businesses

In this article, we will discuss regarding Start-Ups and Small Businesses In India. This is a world of competition where everybody tries their best to prove themselves. Setting up a business in the 21 st century is not that easy, unless and until you have a big sum of money to invest. If you have inherited a property or won a cash price then you can easily set up a business. But in the real world, it is very difficult. In the beginning, you will have nothing. You need customers so you need to go out and sell your products or services. Then you have few customers whom you have to provide with your products or services very sincerely. You might need raw materials and machinery to manufacture your products. When you have manufactured the product or started the work then you can send an invoice. Many businesses send the invoice during the month, and the statement at the end of the month then allows 30days from the statement day for the payment. So the due date for payment could easily be six or seven weeks after you sent the invoice. Only then you can see some actual money coming from your business when customers pay on time.
How To Get Funding For Start-Ups

Further borrowing from the bank is very difficult. Banks hesitate to give money to the start-ups or businesses that are not there for a long time. They lend money if they will get security and most cases security means your homes. If your business fails you will also lose your home at the end of the day. This is why it is so hard to start a business and settling it completely and running successfully. However, there are a couple of sources of money which many people do not opt for because they are not really aware that they are available.
How To Start Small Businesses

The purchase order is one of the methods. Many companies like to bid with government contracts because at the end of the day you are ensured of getting paid. If you deal with some other company it might break up someday and you will be in bad condition. The government is not very likely to go broke – or if it runs short it just raises taxes.
However, your money is secured but government agencies are known for not paying at the right time. This is the reason small business does not take government contract as they are afraid they cannot fund the job till the payday arrives. Purchase order financing makes this possible. Purchase order financing uses the factoring company in a way which enables a small business with the big companies for the government contracts.

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