A steady flow of capital to meet day-to-day expenses and make large business purchases is a necessity for manufacturing SMEs. However, tied-up capital in inventory or unsettled customer invoices puts immense pressure on your cash flow.

It becomes a struggle to establish a balance between timely production, efficient utilization of resources, and working capital management. These challenges disrupt the supply chain, lower your profitability, and reduce your competitiveness.

A business loan for manufacturer can pull you out of capital constraints. Let’s tell you about five ways this loan can turn around your manufacturing business:

1. Purchase Raw Materials and Equipment

The rising cost of raw materials, business equipment, and machinery is a major concern for SMEs. However, these inputs are necessary for manufacturing operations to run smoothly and continuously.

You can use the business loan to procure raw materials or any capital-intensive asset without disrupting the manufacturing process.

2. Hire Manpower

SMEs often face problems in increasing labor resources when manufacturing capacity goes up. If you want to hire skilled manpower to upgrade manufacturing operations, then you have to pay competitive salaries to attract and retain them.

A business loan for manufacturer can help you recruit manpower and expand your team as and when the need arises.

3. Invest in Technology

If you want to become a level field player in the domestic and international markets, you need to deploy cutting-edge technology. However, technology is expensive and it can put a strain on your balance sheet.

When you take a business loan, you can buy state-of-the-art technological equipment or software. You can boost the quality of manufacturing process and finsihed products. The superior quality products will give tough competition to other players in the market. You can increase your market share and earn more profits.

4. Get Export Credit

If you have an export business or want to sell your goods in foreign markets, you need an uninterrupted stream of manufacturing capital. Any delays in manufacturing or inability to fulfill the orders will adversely impact your reputation. As a small business owner, you can’t afford the loss of your brand image.

You can take a loan for export business to ensure timely production and delivery for your international customers. You can get pre-shipment and post-shipment credit such as packing credit, bill factoring, invoice discounting, finance against the collection of bills, line of credit, etc.

5. Generate Working Capital

SMEs require working capital to repair and replace equipment, pay staff salaries, pay creditors, maintain inventory, manage seasonal fluctuations, do marketing, and other routine business activities. Cash shortages hamper manufacturing operations and also reflect poorly on your balance sheet.

A business loan provides working capital financing for all your production activities. It improves your liquidity and gives better business agility.

Procuring Business Loan

Most SMEs approach traditional institutions such as banks to apply for a manufacturing business loan. However, banks follow a tedious application and documentation process. It can take weeks to months for approval of the loan. Some banks may also ask for collateral against loans. You have to follow up constantly with the banks and visit there multiple times.

Can your SME business afford such delays or provide collateral? Indifi, a leading online lending platform understands the importance of quick and easy financing for seamless manufacturing operations. That’s why it offers simple, timely, and unsecured loans at competitive interest rates to grow your business. The paperwork and eligibility criteria are minimal. If your application and documentation are proper, Indifi approves the loan within 24 hours and disburses it within three days.

You can apply for a term loan, export business loan, working capital loan, machinery loan, invoice discounting, bank overdraft/credit lines, merchant cash advance, retail loan, e-commerce business loan, and trading loans from Indifi.

Conclusion

Before you apply for a business loan for manufacturer, make sure to plan on the usage of the loan amount. You should also keep all documents in order for swift approval of your loan application.