In the past year or so, those numbers have only been exacerbated with several small businesses suffering thanks to the pandemic. A good method to ensuring your business will survive its tumultuous first year is to make sure you’re on top of your finances and what you can do to make sure you’re keeping the lights on.
Seek Out a Consultation
Advice can never hurt, especially if it comes from experts who know how to help keep businesses in the black. Seeking out business finance solutions can only benefit you in the long run, especially if you seek advice out early on.
Talking to a professional in business finances means they can help you develop a financial plan for your business, and hopefully keep you afloat for as long as possible.
Use Your Personal Finances
You may have been told that you should never mix your business and personal finances. While this is true, especially for tax purposes, that doesn’t mean you can’t use your personal finances to your business’s benefit. Especially if you find your business struggling, then there is nothing wrong with taking money out of your personal accounts to cover the expenses.
You just have to make sure that you put the money back into your personal accounts when your business is doing better financially, and to make sure you keep everything neatly documented to refer back to later.
Crowdfunding is a popular option among people who are looking for financial solutions, especially when it feels that things are getting tight. Indiegogo, Fundly, Fundable, and Rockethub are some of the options that you have for crowdfunding.
You can share your story on one of those platforms and then get people to donate to you. It is important for you to share your story on various social media platforms.
If your business has been around for a while, then you may be able to get help from an angel investor. Angel investors are people who pool their resources together to help others fund their business. They typically give people between $50,000 and $200,000.
There are many places that have angel investors, including AngelList, Golden Seeds LLC, FundersClub, and Angel Investment Network. You have to be able to prove that you will use the money that you get wisely.
A bank loan is funding that you get that you will eventually have to pay back. The specific requirements needed to get a bank loan can vary greatly depending on what type of loan you’re seeking, from which bank, or for how much.
However, most banks will require that you be in business for at least one year before they’d consider giving you a loan. There are also credit and income requirements that have to be met.
If you can secure a loan though, you can get it deposited directly into your bank account if you are approved. It is important for you to pay your loan as soon as the due date arrives, otherwise, you risk penalties and taking hits on your credit score.
You may even want to set up an automatic draft to make sure you don’t miss the deadline. Paying your loan on time will help you maintain a good credit score and help you build a better relationship with the bank, meaning you’ll be able to rely on them again in the future.
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There are several options to take if your business is in a financial crunch. What’s important is that you do everything you can to make sure you’re business stays open and operational.
Money-wise, that means you might have to do anything from consulting financial professionals to asking for crowdfunding or angel investors. You might even have to pour some of your own money into keeping your business up and running.
Depending on how long you’ve been open and things like your bank and credit score, you might even be able to secure a loan to keep things in the black until you’re financially secure again.
Image Credit: keeping your business funded by twenty20.com
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