When you talk to business colleagues about applying for a business loan, you are generally met with different opinions on the subject. Some will warn you about the pitfalls of doing such a thing, and others may have a positive story about when they applied for a loan. For the negative opinions, you will find that they will tell you of the dangers of doing such a thing, and when you apply for your first business loan, then, you are on the slippery slope to going out of business. Nothing could be further from the truth, and deciding to apply for additional finance when your business is in a stage of growth, may be the smartest thing you have ever done.
While there are some dangers about getting into debt so early in the life of a new venture, applying for business finance in Surrey, doesn’t have to mean that it will be the onset of bad news, and there are many positive stories out there, from young businesses who applied for business loans to expand, and are now major successful businesses in the high street. In order for your business to grow, you need to apply for a loan, if you currently are not able to come up with the capital. Standing still and not moving forward because of the fear of taking out a loan, is not a wise decision. Let’s look at some other good reasons for applying for business finance.
- Expansion – You have started a new business and things are going well. Orders are coming in quicker than you can get them out, you are running out of space to put your stock, and your small number of staff have no space to work. This is a great start to any business venture, but if you continue on like this, you are going to run into trouble. This is the perfect time to think about expanding, but all your money is tied up in stock and so looking for a business loan is the next logical choice. It is important, however, to make sure that your payments can be covered by the profits in this increased expansion and that it is not affecting the bottom line.
- Creating Credit History – As most people have realised, you need to build up a credit history for yourself to ensure that when you apply for subsequent loans in the future, that the figures will back you up as being a borrower who can be trusted to pay back their loan. Taking out small business loans at the beginning of the growth phase of your business is a great idea, because it will set the foundations for more substantial loans in the future. Showing that you can pay on time, every time, builds up a strong business credit history for you and it allows you to create a beneficial relationship with the lender.
Getting business finance is a normal part of doing business in the modern world and you shouldn’t be afraid to expand and increase your profits. All business decisions are about taking risks and this is one risk you can’t afford not to take.