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Published On: Fri, May 25th, 2018

5 Easy Ways to Get Your Small Business Out of Debt

It’s a known fact that small businesses do not have as much capital as larger companies. A few sudden bills, an internal disaster like a data leak or a loss in revenue can cause debt to pile up, amounting to the closure of your business. However, there are many ways for employers to help get their business out of trouble. Here are five ways to reduce debt.

photo/ public domain photos via pixabay

 

  • Quickly Raise Revenue to Boost Your Bank Balance

 

If your business is faced with debt, strive to find ways to quickly raise your business revenue so you can recover your finances. For example, you could host a limited sale offering many discounts or coupon codes. A flash sale can also create a sense of urgency in customers, so they will buy a product or service from your company immediately to avoid disappointment. You could also sell off excess inventory to another company to increase your cash flow and pay off a debt.

 

  • Start Cutting Costs to Increase Your Finances

 

Cutting costs can also be an effective tactic for freeing up cash and resolving bills. For example, while you might not want to say goodbye to a member of the team, if their role is redundant or if they are not pulling their weight, then you need to trim the fat. You could also look for other ways to reduce your overheads, such as relocating to a more affordable business premises, canceling subscriptions, and changing suppliers.

 

  • Apply for a Logbook Loan

 

Don’t allow your business finances to spiral out of control. Take control of your company by applying for a logbook loan UK with Car Cash Point. You can secure a loan against your vehicle, providing you with the opportunity to get out of a financial jam quickly. You can also choose to make repayments between one to five years via weekly or monthly installments.

 

  • Chase Late-Paying Customers

 

It can be easy to face financial difficulty if your customers do not pay their bills on time. If this is a problem for your company, you shouldn’t be afraid to chase them to make the necessary repayments. Write a list of outstanding invoices and start contacting every client. All it might take is a polite nudge for a business to realize they haven’t paid an invoice. As a result, you will have more money in the bank to eradicate debt and potentially top up your rainy day fund.

 

  • Confront the Debt with Your Creditors

 

There is often a stigma when it comes to debt, as many people can feel ashamed for experiencing financial difficulty. As a result, they are often tempted to ignore the problem, rather than face up to it. Don’t allow the debt to come at the cost of your business and speak to your creditors immediately. Be honest with them that you are struggling to make the repayments, and they might be happy to negotiate better repayment terms as a result.

Author: Carol Trehearn

About the Author

- Outside contributors to the Dispatch are always welcome to offer their unique voices, contradictory opinions or presentation of information not included on the site.

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