Web Service Provider Turns Up As An Imperative Component In The Digital World

In today’s world of massive digital transformations, it has almost become an imperative component for every user to understand and also to get adapted to the changing trends of the digital transformations.The web service provider have been on their constant threshold to understand the emerging digital trends in the market and instantly adopt to these trends and finally being able to bring about the suitable web applications which enables the user’s to have a faster transactions in the digital market scenarioAs an analogy, one needs to constantly empower himself and quickly understand the efficacies of the web services and its profound applications to become more successful in his particular endeavor. The e-commerce have always remained the masterpiece that has carved the niche in the cluttered market being innovated, designed and finally deployed in the market place to bring about its own dynamism in the market place.The product companies get their edge through e-commerce platforms

There has been a digital revolution in the market where the product companies get their own edge when displaying their product information over the e-commerce platform and are able to explore the sales funnel instantly.

The online users on the contrary have always been quite inquisitive in understanding the various product lines and are able to able completely see-through the product details at the comfort of their homes.

The e-commerce as a platform has been a benchmark which has enabled the product companies towards increased sales funnel.

The mobile revolution has had its proliferation in the market

The mobile revolution has been the most innovative component of web services and the proliferation of the mobile revolution on par with the apps has been quite captivating in the past three years.

It is needless to mention, that in the last few years there has been an upsurge in the market towards the usage of mobiles and other smart devices by the users in large.

In fact, it would be needless to mention that the mobile revolution has really changed the facets with reference to using the mobile apps in the retail market scenario. The retailers in the mobile revolutionized phase are able to directly connect to the customers with the connected apps.

As an analogy, one needs to understand that the direct interaction with the consumer often reduces the distribution chain for the products to reach the end customers. The mobile apps for eCommerce has become the modus operandi for both the consumer and the product company, as year after year and in this particular transition more and more people prefer to shop using their mobile apps.As a matter of fact, these mobile apps have been so designed to directly communicate with the end user to enable the users with finer details of the product and the subsequent discounts and special offers.The product companies do engage in the custom web services for mobile apps

In the current digital trend, umpteen product companies across the landscape have often engaged the web service providers for the range of custom web services often recurrently to stay ahead in the digital competitive world.

The web service provider often take the advantage of certain third party solutions who are pioneers in the mobile apps and integrate them onto the custom web services to completely enhance the functionalities and further enables the companies to directly connect to the user in a most dynamic way.

Following are the ways the mobile apps have impacted both the product company and user

The mobile apps constantly remains connected with the consumers

Have been able to create purchase impact

The apps have got an inherent capability to capture the consumer’s data

In the recent years, the mobile apps have been used for faster, easier ways for payment transactions.

Alternative Financing Vs. Venture Capital: Which Option Is Best for Boosting Working Capital?

There are several potential financing options available to cash-strapped businesses that need a healthy dose of working capital. A bank loan or line of credit is often the first option that owners think of – and for businesses that qualify, this may be the best option.

In today’s uncertain business, economic and regulatory environment, qualifying for a bank loan can be difficult – especially for start-up companies and those that have experienced any type of financial difficulty. Sometimes, owners of businesses that don’t qualify for a bank loan decide that seeking venture capital or bringing on equity investors are other viable options.

But are they really? While there are some potential benefits to bringing venture capital and so-called “angel” investors into your business, there are drawbacks as well. Unfortunately, owners sometimes don’t think about these drawbacks until the ink has dried on a contract with a venture capitalist or angel investor – and it’s too late to back out of the deal.

Different Types of Financing

One problem with bringing in equity investors to help provide a working capital boost is that working capital and equity are really two different types of financing.

Working capital – or the money that is used to pay business expenses incurred during the time lag until cash from sales (or accounts receivable) is collected – is short-term in nature, so it should be financed via a short-term financing tool. Equity, however, should generally be used to finance rapid growth, business expansion, acquisitions or the purchase of long-term assets, which are defined as assets that are repaid over more than one 12-month business cycle.

But the biggest drawback to bringing equity investors into your business is a potential loss of control. When you sell equity (or shares) in your business to venture capitalists or angels, you are giving up a percentage of ownership in your business, and you may be doing so at an inopportune time. With this dilution of ownership most often comes a loss of control over some or all of the most important business decisions that must be made.

Sometimes, owners are enticed to sell equity by the fact that there is little (if any) out-of-pocket expense. Unlike debt financing, you don’t usually pay interest with equity financing. The equity investor gains its return via the ownership stake gained in your business. But the long-term “cost” of selling equity is always much higher than the short-term cost of debt, in terms of both actual cash cost as well as soft costs like the loss of control and stewardship of your company and the potential future value of the ownership shares that are sold.

Alternative Financing Solutions

But what if your business needs working capital and you don’t qualify for a bank loan or line of credit? Alternative financing solutions are often appropriate for injecting working capital into businesses in this situation. Three of the most common types of alternative financing used by such businesses are:

1. Full-Service Factoring - Businesses sell outstanding accounts receivable on an ongoing basis to a commercial finance (or factoring) company at a discount. The factoring company then manages the receivable until it is paid. Factoring is a well-established and accepted method of temporary alternative finance that is especially well-suited for rapidly growing companies and those with customer concentrations.

2. Accounts Receivable (A/R) Financing - A/R financing is an ideal solution for companies that are not yet bankable but have a stable financial condition and a more diverse customer base. Here, the business provides details on all accounts receivable and pledges those assets as collateral. The proceeds of those receivables are sent to a lockbox while the finance company calculates a borrowing base to determine the amount the company can borrow. When the borrower needs money, it makes an advance request and the finance company advances money using a percentage of the accounts receivable.

3. Asset-Based Lending (ABL) - This is a credit facility secured by all of a company’s assets, which may include A/R, equipment and inventory. Unlike with factoring, the business continues to manage and collect its own receivables and submits collateral reports on an ongoing basis to the finance company, which will review and periodically audit the reports.

In addition to providing working capital and enabling owners to maintain business control, alternative financing may provide other benefits as well:

  • It’s easy to determine the exact cost of financing and obtain an increase.
  • Professional collateral management can be included depending on the facility type and the lender.
  • Real-time, online interactive reporting is often available.
  • It may provide the business with access to more capital.
  • It’s flexible – financing ebbs and flows with the business’ needs.

It’s important to note that there are some circumstances in which equity is a viable and attractive financing solution. This is especially true in cases of business expansion and acquisition and new product launches – these are capital needs that are not generally well suited to debt financing. However, equity is not usually the appropriate financing solution to solve a working capital problem or help plug a cash-flow gap.

A Precious Commodity

Remember that business equity is a precious commodity that should only be considered under the right circumstances and at the right time. When equity financing is sought, ideally this should be done at a time when the company has good growth prospects and a significant cash need for this growth. Ideally, majority ownership (and thus, absolute control) should remain with the company founder(s).

Alternative financing solutions like factoring, A/R financing and ABL can provide the working capital boost many cash-strapped businesses that don’t qualify for bank financing need – without diluting ownership and possibly giving up business control at an inopportune time for the owner. If and when these companies become bankable later, it’s often an easy transition to a traditional bank line of credit. Your banker may be able to refer you to a commercial finance company that can offer the right type of alternative financing solution for your particular situation.

Taking the time to understand all the different financing options available to your business, and the pros and cons of each, is the best way to make sure you choose the best option for your business. The use of alternative financing can help your company grow without diluting your ownership. After all, it’s your business – shouldn’t you keep as much of it as possible?