Running a business would be much easier if life were just a little bit more predictable. Imagine the rock-solid decisions you could make if you had a guarantee that the 10 percent growth in revenue that you experienced this month could continue every month! And what if you knew that each one of your subscribers would continue their service for at least 18 months? That would be financial data you could depend on and use to make wise choices about how quickly to grow your business.
Unfortunately, the economy doesn’t work this way. Depending on the type of industry in which you operate, there are any number of financial fluctuations you’ll have to deal with. Keep reading to learn more about the types of economic fluctuations faced by today’s small to medium-sized businesses as well as the ways that our small business lending solutions can provide a path toward stability.
Types Of Economic Fluctuations
1. Seasonal – When financial industry experts refer to ‘seasonal economic fluctuations’ they’re describing short-term changes in income that occur in a generally consistent pattern. A good example of this is landscaping professionals who may see an uptick in snow removal or tree trimming business during the winter months. The home building and real estate industries generally 
experience an increase in business during the summer, while the first quarter of the year is generally harder for restaurants as people atone for their holiday spending by eating at home more often. And it’s not only these industries that have to worry about mitigating seasonal fluctuations.
“Businesses that supply to these industries have to plan for these seasonal fluctuations and build up enough cash reserves to get them through the slow seasonal periods,” explains Chirantan Basu, writing for the Houston Chronicle.
2. Cyclical – Unlike seasonal economic fluctuations, cyclical fluctuations aren’t as dependable. Instead of waxing and waning with the seasons, these fluctuations are periods of expansion and contraction driven by intangible economic forces. These cycles typically move in swings of 18 months or longer, and can often force businesses to make very difficult decisions as they wait for the tide to turn. To survive cyclical fluctuations, companies may cut back on staff, look for ways to reduce operating expenses, and delay capital investment decisions.
3. Irregular – Finally we’ve arrived at the least predictable type of economic fluctuation. Irregular fluctuations occur as the direct result of a completely unexpected event, such as a natural disaster, union strike, civil unrest, bankruptcy, or even terrorist incidents. These events can have an impact even when they don’t occur in the immediate vicinity of the business itself, but impact supply chains. However, these events can also be a boon for companies in the right industry (i.e. flood insurance or law enforcement supply).
Asset-Based Lending Can Insulate Your Business From Fluctuations
If your business experiences any one of these economic fluctuations in a given year, it could drastically affect your plans for growth, both in the short and long term. The asset-based lending solutions offered by The Commercial Finance Group can be a solution to these problems, providing funding for companies that experience cyclical or seasonal fluctuation in their business cycle.
Want to know more? Contact The Commercial Finance Group in Atlanta today.
