7 Proven Hacks to Stamp Out Your Small Business Debt

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7 PROVEN HACKS TO STAMP OUT YOUR SMALL BUSINESS
DEBT
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Increasing rates of interest and corporate debts
are the major concerns for most investors and
small businesses. According to the U.S. Small
Business Administration (SBA), bad credit
management, little money and personal use of
business funds are the key reasons why small
businesses nosedive. If your small business
doesnt have the money to pay for the basic
expenses like utilities or payroll, you can
quickly get into delinquency or, something less
good, bankrupt. There are many proven hacks to
stable the overall financial health of your
business and effectively paying down your
business debt. Start with getting rid of
additional outlays, reconstruct debts via a third
party, and create a debt repayment plan to help
manage your bills before they become
uncontrollable. Predicting or foreseeing future
is impossible however, there are smart moves you
can take. If youre troubled with a debt, now is
the right time to act smart and try to pay it
down, pay it off, or restructure it. Here are
seven proven hacks you can try to stamp out your
small business debt. To start, lets learn what a
small business debt is.
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A business debt is the money owned by a business
owner to third parties and it becomes untenable
when the business owner unable to repay it back
on time and in full. Excessive debt can stifle
cash flow and put your business at risk and there
could be many reasons of it. You need funding to
leverage an opportunity but the business is not
generating enough organic revenue to cover the
expense. To manage that, you take out a loan.
Then the business opportunity winds up not
swinging your way. Now your business carry
additional debt, but your small business isnt
generating any additional revenue. Accumulating
more debt that youre unable to repay is
frightening, but there is a solution. Some debt
management tips are distinct, while some are more
intricate. Heres a summary of what you should do
in order to get your business back on track from
a load of scary debt.
What Is A Business Debt
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Revision of Budgets
Revision of Budgets A solid understanding of your
business financials is important before tackling
debt. Assess your budgets and its performance.
Track where the money is being spend and how it
is spend. A good business budget provides a clear
picture of your expenses and income that helps in
making vital business decisions. Get help from
your bookkeeper or accountant to assess and
rework your budget. There are also nonprofit
associations like the SCORE Association that
provides free counseling, advise, and online
workshops on business budgeting. You can also use
accounting software like Sage, Wave Accounting
and QuickBooks to track the money flow in your
business and to make the process even easier.
Evaluating and revising your budget should be
your first step towards eliminating your business
debt.
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Review your financial statements to identify
expenses that adds to your debt. Cutting these
little costs is a guaranteed way to reduce debt
and in turn increase cash flow.
The next step after revising budget is to review
your operating costs. Analyze what expenses you
can cut down and settle for services and
operations that are compulsory for the daily
business operation.
CUT DOWN COSTS
Start reviewing every little things like
subscriptions you rarely use, memberships you can
hold off temporarily, renegotiation of low prices
and flat rates with vendors, or stop advertising
on channels that yield little return. Every
little costs accumulate into considerable
business debt.
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PAY WITH CASH
Reorganizing how you pay for expenses can also
help you with your business debt load. If you
carry on to use a business credit card to make
the purchases or pay for expenses, youre only
increasing your debtputting you always in worry
how to pay it off. The best way to manage your
expenses is to pay them via cash or cash
equivalents such as checks temporarily, as per
your budget, can allow you to buy only what you
can afford. This not only prevents debt
accumulation but also helps to eliminate
procuring new debt. This might not be a suitable
option for manyespecially when youre planning
to restructure your debt. While restructuring
debt, you really want to have money on hand to
look favorable to lenders. Think carefully before
choosing this option as your debt elimination
goals.
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Converse with Suppliers Lenders
Having a conversation with your creditors and
lenders can also help reduce your debt load or
interest over time. Start with negotiating for
lower interest rates with them. For credit cards,
you can do this by transferring existing balances
to a 0 introductory APR credit cards that offer
lower interest rate. For loans, discuss your
options with lenders for flexibility. If youre
making regular timely payments, you can also
negotiate lower rates. Second step is to
consolidate your loans into one payment in order
to lower your monthly costs without hurting your
credit. This option will surely comfort your
repayment load and help keep you away from going
default Applying for a hardship plan is also an
option. Such plans offer lower interest rates and
payment extensions. Applying for this involve
explaining your current financial situation with
an evidence that you need support to meet your
debt obligations.
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Develop a Debt Repayment Schedule
If youre unable to consolidate your debt and
still have flabbergasted interest rates with
lenders, develop a solid repayment plan for your
debt. Creating a debt repayment can help you
envisage and repay your debt strategically.
After your first loan is paid off, made stack
payment to the debt with the next-highest
interest. Keep paying the following debts, and so
on until the last debt is paid. Certainly,
following this debt schedule strictly requires
practice and scrutiny but ultimately, youll see
your debt load disappearing soon.
Whether its 500 or 10,000 amount, the first
stack payment should be used over your minimum
payment toward the high-interest loan each pay
period till that debt is reimbursed.
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Upsurge Your Revenue
In simply terms, the more money you make the
quicker you can repay. Making more revenue will
help you to eliminate your small business debt
speedily. Here are some tips to help you increase
your business revenue

• Diversify your offerings by adding more products
  or services, reach out to potential customer base
  via targeted marketing, and tap new niche markets
  to earn more money.
• A little increase in prices can help generate
  more money, but ensure you communicate this to
  your potential customers and ask will they buy
  before the price raise. On the contrary, you can
  also offer discounts and markdowns, especially
  for your repeat customers, in order to boost
  sales. Also, ascertain you dont cut prices too
  much that you wont cover the lost cost with more
  sales.
• Follow up on your accounts receivables for
  payments and offer them discounts or rewards for
  paying fees upfront.
• Offer product/service bundle packages to entice
  your customers to buy more from you. Create a
  campaign for limited time offer, or
  subscriber-only deals can also bring in more
  monthly revenue.
• Check for suppliers to return your unsold
  inventory. This way you can have more space for
  inventory that might actually sell and increase
  your revenue.
• Examine things that you dont use and try to sell
  it to those who might buy it.
• Leverage social media platforms to increase your
  revenue. Build up your business presence, start
  brand awareness campaigns, and solicit feedback
  from customers. Things like answering to users
  comments or encouraging them to review your
  business will assist in revenue generation later.
• Think of other things you can do to earn quick
  money. Like leasing out a portion of your
  building, working remotely to save rent cost,
  become a market research participant, sell used
  tech or assets on Craigslist, or become creative
  with your assets to bring about more revenue.

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Get Help from a Debt-Restructuring Company
If the above-mentioned hacks are not working for
you, its time to ask help from a professional
debt-restructuring firm to do the job for you.
Hiring a debt-restructuring firm will help in
sniffing out inefficiencies and negotiating
better terms with creditors and business debt
collection agencies. Such debt-restructuring
firms charge little fees, but its typically an
affordable alternative to bankruptcy filing and
will help in rebuilding your credit. Have a
candid conversation with your firm on what you
can afford to pay each month so that can
formulate a debt settlement plan that works for
you as well as your creditors. While selecting a
debt-restructuring firm, look for accreditations
from the United States Organization for
Bankruptcy Alternatives or the Turnaround
Management Association in order to avoid scammers
(at additional fee and you to be in default on
several credit agreements).
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The Conclusion
If nothing works out for you, you have options.
You can sell your business, liquidate assets, or
file for bankruptcy. But with any luck, it
doesnt have to come to that. By using the
above-mentioned hacks, you should be able to
lower, and eventually, stamp out your business
debt.
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