If you’re a business owner looking to expand your operations but don’t know where to start, getting eCommerce funding can provide you with the capital you need. This type of working capital is an excellent way to obtain the cash flow necessary to grow your business. Business owners can use eCommerce funding to grow their business, cover marketing costs, and boost sales. However, they must understand how this working capital works and whether they are eligible for them.
In this blog post, we provide an overview of how eCommerce funding works, as well as tips on how businesses can choose and secure one to grow their operations. We’ll examine the benefits of this type of working capital and how it can help your business achieve its objectives.
Why Do Business Owners Need eCommerce Funding?
Due to their lengthy and sometimes erratic cash flow cycles, online business owners frequently face limitations on financing from banks. Online marketplaces like Amazon typically pay their vendors every 14 days. A lot of these online retailers pay their suppliers back 30 or 60 days after buying the product. This lengthens the cash cycle and puts strain on cash flow. The majority of online stores seek eCommerce funding due to balance sheet cash flow difficulties.
With eCommerce funding, sellers can reduce the time between when revenues are earned and when the marketplace pays them by releasing working capital to meet advertising and affiliate program costs, as well as to buy more inventory and shorten their cash flow cycle.
How Does eCommerce Funding Work?
Funding for eCommerce businesses is different from taking out a loan or line of credit because the process has been simplified and shortened significantly. With standard loans, lenders typically require extensive documentation and in-depth background checks, making the process both lengthy and cumbersome. By contrast, funding solutions make it easy for eCommerce businesses to get approved quickly, often within just 24 hours. Plus, there are no restrictions on how the funds can be used; they can be used to purchase inventory, hire employees, or invest in marketing activities.
The benefits of going with a funding solution over traditional loans include more flexible terms and conditions such as fixed repayment schedules, higher approval rates and lower interest rates. Additionally, since the money is not technically a loan but rather an advance against future sales, the repayment amounts are based on your business’s performance which helps reduce your risk of defaulting on payment if sales slow down unexpectedly.
Ultimately, funding solutions offer an accessible way for eCommerce businesses to grow their operations without having to worry about traditional lending standards or high interest rates. With Viably’s digital banking platform for eCommerce sellers, you can get access to working capital quickly and easily so you can expand your business without any hassle.
Choose Viably For Your Funding Needs
If you’re looking to grow your eCommerce business with the right tools that can plan and extend your cash flow, Viably is the answer! Our all-in-one financial management solution makes it easy and quick for you to get all the information you need in one place. Viably works by connecting with the tools Amazon sellers are already using so you can see clearly how each transaction can impact your cash flow.