Ask any small business owner if you should borrow to expand faster, and you will get a very passionate response. Some will warn you of the dangers of borrowing against your business, others will tell you it’s the only way. Ultimately, borrowing is an effective way to raise capital to expand without giving up equity, however, it can come at a steep cost, specifically to cash flow. Below are some pros and cons of borrowing money as a small business owner. Hopefully, they will help you determine what is best for you.
- Allow for Early Expansion – You can generally secure financing to allow you to expand well before you can save those funds.
- Helpful During Slow Seasons – Lines of credit and other revolving credit allow seasonal businesses to stay open during slower seasons, which can be extremely helpful, especially early on.
- Startup Funds – Some businesses require a large sum of cash to get going; lending can provide that cash if you don’t have a large savings account.
- Inventory – Lending can make it easier to buy inventory. With a greater selection often comes greater sales.
- Cash Flow Management – Many small businesses have trouble managing day-to-day and month-to-month expenses. Credit can help cover gaps in payments.
- Expensive – Loans and lines of credit accrue interest. That interest builds up quickly if not paid down. This interest can put small businesses out of business if allowed to grow unchecked.
- Over Expanding – Some businesses will over expand or expand too quickly, and the owner will not be able to manage the new responsibilities. Others will not be able to keep up with the new demand. Expanding is good, but too much growth can actually be bad.
- Kills Cash Flow – Nothing will shut a business down faster than a lack of cash flow. If you are spending the majority of your cash on paying down debts, you will have nothing left to cover other bills, advertise, or take advantage of strategic opportunities.
- Becomes a Crutch – Lending can become a crutch. It can allow you to spend money you don’t have, expecting to pay it down later. If you need loans to cover your expenses month over month, your business may not actually be successful and can lead to serious personal consequences when it crashes down.
Whatever your need, lending can be a blessing and a curse. If you decide to borrow to build your business, do so with a mindful eye toward managing cash flow and ensuring you have a strategy to eliminate the debt as quickly as possible.…
I want to thank Julie from sterlingheightsphotobooth.com for contributing this article on business travel, she has become the resident expert on travel and I recommend you visit her website for an in-depth look at what she’s doing now.
Whether you travel somewhere new every week, or only travel a few times a year, traveling for work can be a nightmare. Many people arrive tired, work long hours, then spend their nights in a hotel bar, waiting for the trip to end. But those who know how to travel right can turn business travel into a great experience. So here are 10 tips on traveling for work to help get you out of that funk.
- Use a Packing Checklist – Nothing can start a trip off on the wrong foot worse than forgetting something important. If you have a checklist which you create in advance of packing, you’ll never forget what you need.
- Do Your Research – Whether going to a major city or a small town, look into what there is to do. Is there a city square you should see? A specific restaurant you want to try? If you wait until you are there, it will likely be too late, but if you plan ahead you can squeeze in some fun things to do.
- Use Public Transportation when Available – If you are traveling to a major city, taking a bus, subway, or train can be an opportunity to experience the city in ways you never can from a boardroom or bar.
- Get Your Work Done Early – You will likely have time in the morning before you need to leave the hotel that is dead time. It may be an hour, it may be two, but it is time that could be used to get emails sorted, projects reviewed, or other tasks completed. This way, you can actually enjoy the night.
- Schedule Meetings at Mealtimes – If you have any say in when you meet with clients or coworkers, try to do it at mealtimes. This will give you the opportunity to try out restaurants, see different parts of the city, and enjoy that meeting a little more.
- Go a Day Early – Or stay a day late. Either way, this gives you a day to explore without a hectic day of meetings.
- Get Out – If you are stuck in corporate meetings all day at a corporate building, then head back to the hotel to eat dinner, find other places to eat. If you have downtime one day, walk around the city, grab a cab and go to a tourist area, do something. You don’t want to be a world traveler who’s never really been anywhere.
- Network – If possible, find out about people in the city where you are traveling who you may want to meet. Try to schedule time to grab a lunch with them to expand your network. Someone who does your job in another town may be able to give you a new perspective on your job. Similarly, a big prospect may appreciate the personal touch of an in-person meeting.
- Travel More, Less – If you need to go to LA to meet a client, but also have several in San Francisco and San Diego