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Many first-time business owners think about cash flow only when their cash reserves are low. Drake, founder and CEO of a digital marketing agency, didn’t find a funding option until after he already felt the consequences of lumpy cash flow. He watched his cash spike when a client paid, and then dwindle down while he waited on the next client to pay their invoice.

“I have good clients. They all pay,” said Drake. But the lumpy cash flow issue was a problem: “I was having to tell employees, ‘I’m sorry, but I have to delay your paycheck.’ I was constantly watching my mail for the next check, which was a huge stress.” Then Drake found a way to get advances on those invoices to get cash when he needed it. “The stress was 90% cut,” he said.

Shegar, who was a regional manager for a big retailer prior to being a business owner, took a different approach for his security business. He went searching for a credit line while his business was still healthy and he still had cash in the bank. Why? “Even if I don’t need it now, I will always have a reserve. It’s worth it, even if you have to pay a little interest.”

This paid off when he found a big potential client who wanted his security services — starting the next day. Thanks to his available credit line, Shegar was able to front the $20,000 to pay the security guards before the invoices started getting paid by the client and cash started coming in.

Experienced business owners know three things:

  1. A business owner’s time is better spent growing and managing the business, not fixing cash a flow crisis. Having a credit line gives you breathing room so you can focus on your important business operations instead of watching every cash flow dip — and so you can sleep better at night.
  2. A loan or advance is almost always cheaper than delaying payroll or turning down business. A new business owner focuses on the cost of financing; an experienced owner knows that the hit to morale from delaying payroll or the lost profit from passing on a new client are both more expensive than the short-term cost of financing.
  3. Shopping during a crisis makes you easy prey for shady financiers. Many short-term financing vendors couple long-term contracts with hidden fees to lure in clients who don’t have time to do good research. Look for a credit line when thing are good and you have time to do your research.

Experienced business owners know to expect the unexpected. Having an available credit line, even if rarely used, is a key tool when that unexpected cash flow dip happens.