Growing faster than cash: a line of credit in McKinney, TX

The growth problem is a timing problem

McKinney is the county seat of Collin County, about 32 miles north of Dallas, and the third-largest city in the county. The Census Bureau ranked it the nation's fourth fastest-growing large city from 2010 to 2019, and the city counted 195,308 residents in 2020. For a business, a growing market means more customers, but also more to spend before those customers pay: another hire, a larger inventory order, a second van.

Five places growth eats cash first

1. Hiring ahead of demand. A new employee costs wages from week one and produces revenue later.
2. Bigger orders. Suppliers may offer better prices on volume, but the cash leaves the same week.
3. New space. Deposits, fit-out and rent often start before opening day.
4. Slower customers. Larger commercial accounts can pay later than small ones.
5. Taxes and filings. The franchise tax report is due May 15, and wage reports and taxes are due the last day of the month after each quarter.

What a line adds

A line of credit lets a business draw as needed instead of taking one lump sum. During growth, that flexibility can mean paying for the hire or the order when it is needed and avoiding more borrowed money than the moment requires. Offer terms are set out in the offer, not here. We consider funding from $25,000 to $5,000,000. Funding can arrive in as little as 24 hours, the application takes about five minutes with a soft credit pull, and sole proprietors can apply.

Do not use a line for everything

If the growth is a defined project, such as a buildout with a known price, a term loan may match better. If it is a vehicle or machine, read about equipment financing. A general cushion is covered under working capital, and speed questions under same-day funding and merchant cash advance.

A growth plan that pairs with the money

Growth looks different from one McKinney business to the next, but the discipline is the same. Before drawing on a line to fund growth, write down what each new cost should produce and when. A hire who takes three months to become productive needs three months of cash. A larger inventory order that sells in six weeks needs six weeks of cover. Owners who connect each draw to a dated expectation tend to repay more smoothly, and they spot early when the plan is slipping. If the numbers show growth that costs more than it earns for a long stretch, slow the spending instead of increasing the draw.

Nearby

Customers and suppliers often span Plano, Frisco, Allen, Wylie, Prosper, Murphy, Princeton and Anna. See Collin County and the Dallas-Fort Worth Metroplex, or apply.