In this blog, we explore practical strategies to handle business debt responsibly.
Let's face it, debt is part of life. It can be required for being able to provide the capital for growth, but can also get out of hand if not managed correctly, leading to risk of cashflow restrictions, or worse.
Prioritize and Organize Debt
📋 Create a list of all business debts, including interest rates, payment terms, and balances. Using your Balance Sheet report can help with this.
Prioritize high-interest debt for quicker repayment and assess if refinancing options can help reduce costs.
Communicate with Creditors
📞 If you're struggling to meet repayments, contact creditors early to negotiate more manageable terms. Most lenders appreciate proactive communication and may offer temporary relief or revised payment schedules. Burying your head in the sand will get you nowhere. If you just leave it until last minute or don't contact people until they contact you, you won't be making any friends and they will be less likely to help you by offering debt relief or modified repayment plans.
Avoid Accumulating Unnecessary Debt
🚫 Evaluate new financing options carefully. Avoid taking on more debt unless it directly supports business growth or essential operations.
When taking on a new debt, develop a realistic budget to control expenses and avoid excessive borrowing.
Conclusion
Need help sorting your debt management strategy? Our team can help you sort through what you owe and offer a guided approach on what to focus your efforts on to repay.
Contact the team to talk more about how we can help.
