What Can Debt Do For Your Small Business

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All too often the small business person thinks that debt is a universally bad thing.  The truth is there are a lot of ways you can use debt to work for you and your business.  Consider some of the following ways debt can be good for you and your business.  

Building Credit

There are just a few ways to build your credit and one of the most critical is accruing manageable debts.  When you have a small business it is likely there will come a time when you will need a loan and if you have no credit you will find it exceedingly difficult.  When working to build this credit you should start with small debts that are manageable.  You’ll want to get a debt that you can pay off within a few months and make several payments to make it work best for your credit.  

Making Large Purchases

Most businesses will run up against a time when they will need a large purchase; new equipment, a move or a promotion.  This means you’ll likely have to go into debt to cover the expense.  This is the perfect opportunity to also build your credit by creating a small, manageable debt.  

Supplementing Cash Flow

Some businesses are seasonal; in fact most businesses have busy seasons and slow seasons.  If you haven’t learned the trick of budgeting through the slow seasons it may be the right time to go into manageable debt.  The most important thing to do is carefully consider what you spend and how much you go into debt.  

Making Repairs

It always seems that something breaks down when you have no extra money.  In this case, having the opportunity to extend a little by way of going into debt can help your business through a rough patch.