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Table of Contents
1. Run marketing campaigns
2. Stock up on inventory
3. Pay back your dues
4. Hire professionals for projects
5. Stay ready for sudden expenses
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In the growth phase, businesses also fund their working capital requirements
with short-term loans and advances.
Working capital has to not only be managed efficiently but used effectively
as well. More so for online businesses. Effective use of working capital can
help online businesses grow and broaden their customer base.
Here are 5 ways to use working capital loans to grow your online business.
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Run
marketing campaigns
A positive side effect of the pandemic has been the rising adoption of online
shopping. Consumers are wary of stepping out of their homes to make pur-
chases. They prefer to buy using apps and websites, which is great news for
an online business. Your customers are already where you are – on the
internet.
To begin with, you won’t require a big budget to run these ads. Hence, you
can use some part of your working capital to quickly get the ball rolling.
Stock up on inventory
A lot of brands fail because they promise but don’t deliver. Let’s say you run
an ad and bring a prospective customer to your website. The customer
spends time looking at your products and selects the one she likes. But after
adding the product to her cart, she is informed that the product is out of
stock.
This is the kind of bad customer experience that you don’t want to provide.
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products.
Make sure you have enough inventory to fulfil the orders you receive. You can
prioritise your inventory on the basis of sales trends. Working capital can be
used to stock up on products that are sold the most. This will also ensure
that the inflow of money will be in line with the outflow.
And to maintain a good credit score, a business needs to pay back its dues
on time. This is where working capital can come in more than handy.
You can use your working capital to pay any instalments or EMIs that you
might have for business purposes. Making sure that you don’t miss any due
dates for such payments will ensure that you are able to get a loan easily at
a later date as well.
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You can use your working capital to employ such professionals for specific,
time-based projects. No need to hire them as full-time employees and pay
them a monthly salary.
One way of handling such expenses is by taking Cash Advance from Razor-
pay – it is an additional source of cash that you can withdraw instantly
when you need. Of course, dipping into your working capital is also the easi-
est way to meet these expenses. You can use it for medical emergencies,
quick repairs, unplanned inventory, etc.
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These are some of the ways that a business can use working capital
to effec-
tively keep operations running. But at the same time, getting working capital
loans is not easy for MSMEs. With Razorpay, the process becomes easier and
quicker.
SU BSCRIBE
6
Saurin Parikh
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