Contributed article in our anti-viral cleanliness series. Enjoy! – Kimberly
Financing a business can be costly and challenging, particularly as you have many ongoing costs throughout the life of your organization.
From growth through to diversification, there’s a range of reasons why your company will need to explore financing options throughout its lifecycle.
When seeking business finance, there’s a range of techniques you should use, and many that you definitely shouldn’t. It can be tough for new business owners to navigate the competitive world of business finance, so to help, we’ve put together a list of the dos and don’ts of business finance.
Don’t: Choose The First Provider You See
Do: Review All The Options Before You Choose A Provider
Choosing a financing option can be challenging, with so many companies out there offering financial products and trying to entice you with fancy advertising campaigns.
As well as beautifully curated adverts, financing providers will often try to lure you in by offering discounts and deals, but they’re usually not worth as much as you think. As such, you need to review all the options on the market before you make your decision so that you get the best deal possible.
Don’t: Focus On Interest Rates
Do: Explore The Terms Of Every Option
Interest rates are important when you’re borrowing money, as you need to understand how much your borrowing is going to cost.
However, there are other considerations to take into account, such as the length of time you have to repay your loan or business finance. One of the key advantages of getting a loan to finance your business endeavors is that you have long and short-term options to choose from, meaning that you can find a solution that will meet your business’s requirements.
Don’t: Overlook Customer Service
Do: Find A Financing Provider That Offers Great Customer Support
With so many factors to consider when choosing business finance, it’s easy to forget about customer service and simply explore the terms of the financing packages each provider offers. However, customer service is vitally important when choosing any product or service, particularly one as crucial as business financing.
If your provider doesn’t offer you a responsive, supportive service, then if something goes wrong or your require assistance, you could find yourself becoming stressed and wasting a lot of time trying to communicate with your provider. Review the customer service provided by every financing supplier before you commit to working with them.
Don’t: Only Look At Paid Finance Options
Do: Check Out The Business Grants Available
Business loans, asset financing and lines of credit are great ways to finance your business, but there are also grants available that could help your company.
The UK corporate market has a wide range of business grants that firms may be eligible for depending on their size, location, service offering and sector. Check out the range of grants on offer and review whether your company is eligible, so that you can reduce the cost of your business financing and avail yourself of all the grants you’re able to receive.
Don’t: Exclusively Explore Financing Options From Banks
Do: Check Out The Alternative Lenders Available
When you think of business finance, the first option you consider is probably banks and large financial institutions. While these organisations do offer a wide range of business financing solutions, they are not the only lenders on the market.
There is also an extensive selection of alternative lenders operating on the market currently, including Angel Investors, peer-to-peer lending providers, crowdfunding platforms and many others. Some of the options may be more cost-effective and flexible, so you should explore all of the choices on offer before you make your decision.
Don’t: Think You Have To Choose Alone
Do: Ask For Advice From Experts
Finding the perfect business finance product for your company can be a daunting task, but just because you’re the business leader and responsible for this momentous decision, doesn’t mean that you have to undertake it completely alone.
Never be afraid to ask for support and advice. If you have a team of fellow investors and business owners helping you to manage your company, then you’re in a perfect position to get the help and advice you need. If you’re running your business alone, then you can still find help when you need it. You can find a mentor, or enlist the services of a business finance advisor so that you can make an informed decision with impartial help.
Selecting the business finance options that are right for your business depends on a variety of factors, so it takes a lot of research and consideration to pick the perfect opportunity for your organization. This list of the dos and don’ts of business finance should help you to make the choice that’s best for your company and help it to accomplish the success you’ve always dreamed of achieving.
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