Product development, sourcing and distribution are, for the most part, a supplier’s responsibility – all of which create long lead times. The website like Bit Software 360 will assist traders in their bitcoin journey with the best trading tools, fast payouts and phenomenal customer support. As for e-commerce retailers, their dependence on third-party distributors and inventory management often results in reduced margins. And finally brick & mortar retailers are increasingly at the mercy of suppliers to “just get me a few more units” before they sell out.
With crowdfunding, everyone can expand their businesses by having some extra cash flow to purchase inventory as well as being able to fulfil orders more quickly by having more stock. Recently, the online business forum ran a survey on the hurdles that retail businesses face when getting into e-commerce and whether crowdfunding was an option some might consider.
The results were not surprising – most executives feel that current regulations are holding them back. As more brick & mortar businesses start to embrace e-commerce, there is a growing need for alternative financing options for them. As capital markets continue to exhibit signs of stress and credit remains elusive for small and medium-sized businesses, large and small companies are turning to alternative financing options such as obtaining short-term loans from friends, family members or a lending institution.
There are obvious risks associated with taking out a loan either way. In some situations, it might be tough to secure one with traditional bank financing – especially if your business is new or has yet to prove its long-term viability. So let’s explore the benefits of crowdfunding powered by blockchain.
Benefits of crowdfunding powered by blockchain:
Blockchain technology utilizes complex algorithms that support peer-to-peer networking, thereby eliminating the centralized management of all transactions. At this point, many organizations are developing blockchain platforms for crowdfunding, and some are being integrated into supply chain management.
By taking advantage of blockchain technology and related platforms, you can secure funding for any project without relinquishing control over your company’s data. In addition, blockchain platforms benefit businesses that sell their products directly to consumers because they reduce the risk of fraud and improve customer satisfaction. And they can be used by businesses of any size that can generate revenue and sell products directly to consumers.
Benefits of blockchain over traditional crowdfunding:
Traditional crowdfunding allows a group to come together and pitch in a lump sum for an idea or venture without expecting a profit. Because each participant only pays for and receives what is needed, it is also a way to support and encourage people who may not otherwise have the funds to join an effort.
Benefits of blockchain’s peer-to-peer systems:
The primary benefit that blockchain can offer to the crowdfunding industry is its ability to maintain a single registry of all transactions in the system. It is especially true if your products and services are sold directly to consumers without third-party distribution channels.
Benefits of blockchain to traditional business:
Funding your supply chain can be difficult, especially if you are a new or emerging retailer. You may also have a small amount of cash in the bank, but you need a more significant amount to grow your business, acquire inventory and ship it to customers quickly. Unfortunately, a loan from a bank can be hard to come by these days, so you may have to turn to family and friends, angels and other finance sources that are hard to find or expensive.
The good news is that blockchain technology – one of the newest cutting-edge technologies – offers a peer-to-peer lending platform that could help you close this funding gap more quickly with better terms than banks currently offer in this market environment.
Peer-to-peer lending for crowdfunding:
The peer-to-peer lending platforms connect individual lenders with borrowers – enabling both sides to get better rates and terms. The blockchain technology ecosystem is creating an entirely new business model that cuts out all intermediaries, improves efficiency and transparency and offers borrowers alternative financing options with lower barriers to entry.
In addition, blockchain technology will help to eliminate fraud by making it impossible for hackers to steal personal data or financial information. Promising new technologies such as 3D printing, CRISPR gene editing, artificial intelligence and machine learning are also enhancing this platform’s ability to help businesses solve challenges and extract value from previously unimaginable sources of data. It is possible through the peer-to-peer lending ecosystem powered by blockchain technology.
How to get started with crowdfunding?
The first step is assessing your business risks and paying particular attention to any startup issues that could hamper your ability to grow in the future. Accurate cash flow forecasting and proper risk management are vital for all business managers, especially businesses that will be doing business online. Many more factors could affect your bottom line. It would help if you also explored ways to optimize cash flow while reducing exposure to various risks – especially those outside your control or influence.
