The most obvious choice of funding and usually the cheapest is bank finance.  However, you will need to have your business case prepared in advance.  This should be undertaken by your accountant to show your projected profit and loss statement for the next financial year, together with some valid assumptions about the likely conditions that your business will face over that period.  You should undertake a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats), of your business to present to your banker.  This will demonstrate to your banker that you have turned your mind to business risks.

After reviewing your likely projections; you will want to discuss with your banker, term loans to restructure any fixed assets and ‘structural’ assets, that may remain static over a longer time period.  Sometimes these assets may be better parked off the balance sheet as operating or finance leases.

Any peak cash requirements over the projected period should then be rolled into an overdraft facility.  This usually recognises that during certain periods your cash requirements may be greater in some months than in other months when cash flow is higher.  One item, which chews into your cash flow, includes funding sales expansion - more sales correspond to more debtors, unless you maintain a strict credit policy.  You may need to review your terms of trade and credit policy, and ensure that you have registered any security interests under the Personal Property Securities Register (PPSR).