Debt can be a drain on a business, especially if you are hoping to end the year in green, we will discuss some strategies to help you get closer to that goal.
Considering a renegotiation of loans whilst also pursuing other opportunities such as grants can be a great way to reduce or eliminate this debt.
Keep reading for three other life-saving methods to consider as well.
Renegotiating the Terms of your Current Loans
If you currently have loans that are proving difficult to pay back due to existing debt, it might be worth considering with your lender if you are able to renegotiate the terms of these loans and sort out a mutually beneficial agreement.
By expressing the hardship of the current loan on your finances, you may be able to secure an agreement to change the terms of the loan. This could be a reduction in interest rates for example, or simply changing how frequently the loans are paid, allowing you that extra time for other beneficial financial decisions to help keep your business up and running, allowing you to build towards the reduction of your debt.
Using Grant Opportunities
It is extremely likely that your business may be eligible for grants from entities such as the government or other entities with a goal in mind that you help to pursue. For example, your firm may specialise in an area that supports a key government objective, and if you believe this may be the case, it is worth getting in contact with them to explore any options available.
Further to this, in the current pandemic, you are likely to be able to access some potential grants to support you at this difficult time, and these are great at reducing your current debt.
Focusing on Eliminating the Debt as Opposed to Other Objectives
If you are in a stable position in regard to your company, and your finances appear to be the only difficulty, it might be worth diverting your attention away from other opportunities for growth to focus on eliminating your debt.
It may be worth making conservative decisions at this time, such as not hiring new employees such as marketing directors to promote your social media presence if it is relatively stable at this point in time. This allows you to focus on the task at hand, reducing extra unnecessary costs in the short term.
Focus on Increasing your Sales
However, as a business, you must run an analysis to see if the previous point is the best option, as it may be worth incurring that short term cost if it is likely to return positive results, such as increased sales, money from which can be used to pay off such debts. In which case, alternate strategies may be necessary to pursue.
Tapping into Your Networks
Finally, if you have crippling debt, consider using your network to help you. You may have family and friends who can help you pay off existing loans if they believe in the long-term success of your business.