If you’re a small business owner, you know how challenging it can be to get the funds you need to push your business off the ground. To do this, many business owners feel the need to take out lines of credit or use business credit cards as a way to gain access to the money necessary to get their business going. However, this can start you down a dark path that could lead your business into a long history of being in debt. So to help ensure your business isn’t in the red for years to come, here are three tips for getting your small business out of debt.
Get A Handle On What Debt You Have
Before you can start addressing the amounts of debt you have accumulated, you first need to
have a complete view on what debts you have and the details surrounding them. In your excitement to get your business started, you may have quickly taken on debt that you didn’t
necessarily understand at the time. This could result in you actually having a lot more debt than you imagined. For this reason, Steve Nicastro, a contributor to Nerd Wallet, advises that you take an inventory of all your debts and begin to sort them by how extensive they are and when
you need to be paying on them. With this knowledge, you can start to develop a plan of attack.
Find Where You Can Start Cutting Costs
One of the biggest challenges when trying to get out of debt is finding ways to pay more money toward those debts and less money toward all other areas. However, accomplishing this can be the difference between getting out from under crushing debt and remaining trapped for years to
come. To help with this, Diana Ransom, a contributor to Entrepreneur.com, advises that you
start cutting costs as substantially as you can without sacrificing the quality of your business. Once you’ve found areas where you can begin saving, apply all that money toward your pieces of debt.
Make Plans To Boost Sales
In addition to cutting costs, you should also try to take out all the stops that are keeping you from having higher sales. With more sales coming in, you’ll also have more cash coming in, which you can put directly toward paying off your debts and saving the future of your business. According to Bridgette Austin, a contributor to Intuit Quickbooks, taking steps like marking down your products or services for a short time could be the boost to sales that you need to start
bringing in more money to assist with debt payoff.
If your small business is in debt, consider using the tips mentioned above to help you get out from under this burden.