Debt and equity financing are two main sources of business. Briefly state and explain other sources of business finance.
a)Trade Credit: A source of financing in which inventory is obtained
by the buyer on credit. It is unsecured loan which is interest free.
b) Customer Credit: A source of business capital provided by
customers who pay a certain percentage of the total cost of an item to
the seller as a down payment at the time the order is made.
c) Networking with other Entrepreneurs: A source of business
financing in which entrepreneurs cooperate with other and enter into
agreement to share certain costs through part production.
d) Internal Cash Management: A source of obtaining business
financing by entrepreneurs practizing sound internal business
management decision to conserve cash.
c) Venture Capital: This is a valuable source of financing in which
professional people with capital provide a full range of financial services for new or growing venture.
Trade Credit, Customer Credit,Networking with other Entrepreneurs, Internal Cash Management and venture capital.