Setting up a business can involve significant expenses, for start-up costs, equipment and work space. And sometimes, these are necessary debts, taken on in the hope that revenue will soon become enough to cover the debt early on. Unfortunately, sometimes it isn’t always just that easy.
It can take time for businesses to grow, develop, and make profit, which can often leaves people with no choice but to turn to other forms of debt to help them get by.
However, if you do end up struggling to manage your business debt and become insolvent, it is then illegal for you to continue trading and your business may result in bankruptcy.
How to manage business debts
▪️ Speak to your creditors
Ask any creditors about spreading out your repayments or ways to work around your cash flow issues in order to help you until you can get back on your feet. If you keep them up to date with your situation, they’ll be more willing to work with you.
Oftentimes, creditors can be understanding about your situation and they may allow you to spread out your repayments until you can get back on your feet. If you are open and honest with them about your situation, they will then be more willing to work along with you and give you some leeway.
▪️ Reduce your overheads
Just small and simple changes to your overheads can make a big impact on helping you manage your finances.
▪️ Sell non-essential company assets
If something isn’t essential to your business but it still costing you money to own and operate, it might be worth selling. This can help you free up some extra cash which can then help go towards your repayments.
▪️ Book a free debt consultation
You are entitled to free money advice. By using our services, we can help you see all of the debt solution options that are available to you. Our services are completely free, impartial and confidential.