Question

You have recently been appointed the Chief Financial Officer of Big Dreams Limited, a company in the fast moving consumer goods industry. The shareholders of the company at their Annual General Meeting approved an ambitious major expansion project that will enable the company to gain market share. You as the CFO has been tasked with preparing a report for the company’s board of directors clearly evaluating the available financing options.

Answer 1

This report is to discuss regarding the fianncing options in the coming project taking on our consumer goods.

BENEFITS OF HAVING FINANCE ON CONSUMER GOODS

1. The biggest advantage of having our consumer goods financing service backing your business is its flexibility.
2. You can get easy access to credit whenever you need it, especially if you have immediate or emergent expenses.
3. There are rewards and perks if you can manage to pay in time.
4. You can get a convenient interest rate with zero collateral.
5. Installment options are healthy for businesses that are looking for long term collaboration and regular payment, which also establishes their credit history for future loans.

WAYS TO DO THE FINANCING

Business financing especially when it comes to consumer goods financing can be a difficult task given the current economic upheaval that is happening. But securing funds is entirely up to you since there is a varied range of options which can help you fund your business with convenient loan options. To help you secure a fund more easily than ever, here are 5 ways that you can use to pursue your business financing.

1. Lending standards are more convenient than ever once you opt for Zip Loan. Unless of course, you are going for conventional banks that are stricter and even a slight delay mars your overall credit score. With us, you can expect easy payouts and installments with zero collateral.
2. You can try crowdfunding which now is a credible way to finance your own business. If your business is ready to change the world, it is time for you to show the potential that your business holds to the rest of the world. But it can be a bit hard to setup goals which can be met thoroughly.
3. You can pledge some of your earnings or saving. Or take a personal loan for instance.
4. If you lack a credit history, then a microloan can be viable option.
5. If you can use your credit card, then you can pay regularly or as per the norms.

these are various options in front of us we can choose the most convenient and better one by taking various other factors too into consideration like

Consider the Repayment Terms

Consider how long the financing arrangement is structured to last. Longer loans can build up a significant amount of interest over time, but loans with shorter terms can require larger periodic payments. Consider the amount of the periodic payment and how often you are required to pay. Also take into account the allocation of each payment to principal and interest; look for loans with a higher allocation to principal to minimize the total long-term cost.

Interest and Fee Structures

Add up all of the costs associated with each financing method before making a decision. Common costs for loans include interest rates, origination fees and brokers' fees. Financing through investment can carry much different costs.

Lender Financing Requirements

Consider the personal requirements each lender and investor places on applicants. Pursue financing from sources whose requirements you meet in full. Common financing requirements include credit score requirements and specific financial ratio tests, such as the debt-to-equity or interest coverage ratios. Discuss the requirements placed on applicants with each lender before preparing a loan application package.

Additional Financing Requirements

If you are thinking about financing your business through investment, look into all the ramifications of your decision before moving ahead. Venture capitalists often require an ownership stake in the company, which they expect you to buy back at a premium after a period of rapid growth. Before you buy the ownership stake back, however, the investor may assert a great deal of influence on managerial and strategic decisions.

So by looking to all these factors we can take a good choice and decision regarding the best and most beneficial method financing when comparing each other.