People package entrepreneurship as this amazing sailboat that will give you the freedom to do what you want without having to wake up early or sleep let. But, as it turns out, this is nothing but a lie. Running your own business is the toughest thing! And, something else you won’t be told is that you can close shop after a few months because of debts choking your business.
Businesses are unpredictable, and there are many instances where you will do everything you can, but the external factors won’t let your business survive. During the survival mode, you will take on loans, and unfortunately, you may never recover. Knowing that your business can fail at any time, here are some tips that will cushion you from falling:
- Reduce your business expenses
How high are your operating expenses and, are there costs you can axe? If you pay a subscription for services you use occasionally, then you should consider suspending that expense until you have your finances in order. You may want to seek help from a finance professional to get spending projections and to determine the costs that need to be out of your expense list.
Reducing expenses means subletting the extra office space or downgrading. If you live in condo rentals Fort York, then you can work from home!
- Consolidate your debts for a lower interest rate
If you are grappling with several debts, then you may want to make your life easier by dealing with one loan. Through debt consolidation, you get to pay off all the small debts using one loan, and at the end, you only have a single loan to pay off monthly. Through debt consolidation, you can budget better. With the lower interest rate, you will have better control over your finances.
Debt consolidation also works for credit cards, and you can transfer multiple debts onto one credit card with zero interest rate. A zero percent APR will allow you better control over your finances.
- Debt collection
There is a high possibility of someone else owing you money. To get out of that sticky debt situation, you should get your money back and use it to pay off other creditors. As you wait for your debtors to pay, you should communicate with your creditors directly and ask them for a little more time. Yes, you can explain your hardships to them as you can get a hardship policy that will reduce the settlement amount.
- Seek professional help
The stress that comes with high debt is overwhelming. Without help, you won’t be able to think clearly about how to run your business in the best way. The psychotherapeutic help will also help you deal with anxiety and depression as these two conditions can easily affect your ability to perform well at work. It also helps to get solid 7-8 hours of sleep.
- Increase sales
You don’t have to offer discounts just because you are looking to sell more than your competition. In most cases, marking down your prices will boost your revenue. Loyal and your repeat customers will be happy to buy more products when you have an ongoing sale.
When your creditors are on your neck, and your debtors aren’t paying you in time, you have to consider alternatives. To get out of debt, debt restructuring will work. All you have to do is to get professionals to negotiate on your behalf. Your credit agreements may be extended or renewed. This is the ideal solution when dealing with high-interest debts.
Finally, you should avoid incurring extra debts before paying off what is owed.