There are instances when Banks turn down the request of SMEs for asset-based lending. It means obtaining a line of credit based on assets. For SMEs, assets are their existing inventory and to purchase additional inventories they require capital. That’s where they are turned down by the banks. However, big retail organizations easily get asset-based lending from big institutional banks.
SMEs use their existing inventory as collateral to obtain the revolving line of credit. But they don’t get the credit due to their previous track records with the banks. There are other ways to get inventory financing. However, it is said that borrowing and spending is not a way towards prosperity. And spending on getting additional inventory can create a severe cash strain on small businesses. So why not use technology that helps SMEs to track down the items not selling well? This will keep their inventory lean and allow frequent turnover. And why not avoid overbuying inventory and have enough in stock to schedule inventory deliveries at the right time and the right place?
But before implementing all this, SMEs have to keep a daily track of in stock, out of stock or dead stock via the help of technologies that rely on predicting the inventory levels on daily basis. The ability of predictive analytics can surely help you avoid the problems you’re going to face ahead by balancing the inventory levels. And the future belongs to those who prepare for it today. So, today is the day.
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