Financing Options for Clothing Manufacturers
Clothing manufacturers frequently face challenges when trying to secure small business financing. Banks and other traditional lenders have often have prohibitively high requirements for entrepreneurs. Additionally, traditional channels can take a long time to process loan applications, which is less than ideal when businesses have time-sensitive financial needs. In order to help clothing manufacturers in need of working capital, we have compiled a short list of small business financing solutions.
SBA Loans for Clothing Manufacturers
The Small Business Administration (SBA) offers a number loan programs for new and small business operations. These small business loans offer working capital for everything from securing commercial real estate for manufacturing operations, to equipment, and even just regular funding to get the business up and running. Because the SBA is inundated with loan requests, going through traditional channels can take a long time to process applications. As an alternative, the SBA has designated select commercial lenders as “Preferred Financial Services Companies.” By using commercial lenders with this title, SBA loan requests can be fast tracked in order to get clothing manufacturers the funds they need as quickly as possible, and with competitive terms and rates.
For clothing manufacturers in business for under two years, getting unsecured lines of credit can seem like an impossibility. Fortunately, the world of commercial financing offers small business solutions in the form of unsecured credit lines for new clothing manufacturers. These lines of credit offer low rates and the ability to grow business credit ratings, without having to settle for “secured credit” through traditional lenders. Unsecured lines of credit typically start at $25,000 and can go as high as $500,000 depending on the size of the business, as well as revenue.
Factoring is a Nice Fit for Clothing Manufacturers
When clothing manufacturers send out orders to their customers, they frequently spend the following 30 days (or longer, depending on the aging window on the invoices) waiting for payments. This can place a major strain on cash flow, especially with the cost of filling new and recurring orders. Factoring allows manufacturers to exchange open invoices for cash. The turnaround time on submitted invoices is usually 24 hours, and this type of financing does no require any credit checks, and does not place any debt on the balance sheets.
If you would like further details about any of the small business financing solutions listed above, or if you would like to explore our other funding options for manufacturers, call Davis Commercial Finance at 916-412-5577 or email at your convenience firstname.lastname@example.org.