According to the U.S Small Business Administration there are a number of reasons that small businesses are unsuccessful. The most common of these are lack of funding, poor credit management, and falling into a pattern of using business funds to make personal purchases. Unfortunately, when business owners lack the funds to pay for even the most basic of these expenses, for example rent, payroll, and utilities they can quickly find themselves in a position of falling so far behind they have no other choice but to file for bankruptcy. The good news is there are viable options available to you to help you build a financially stable and healthy business while paying off business debt, including removing excess expenses, and using a third party vendor to consolidate your debts, and restricting your financials to include a proactive payment plan that will enable you to effectively manage your bills before they become an issue. Mecham Dicus & Company offer helpful tips to help reduce business debt.
Create a New Financial Business Budget
Having a full understanding of your current financials is paramount to keeping your business in good standing. If you are falling behind on your monthly payments you can rework your financials to include for unexpected changes. A well formulated business budget will give you the ability to identify sources of income, and correctly calculate the costs and expenses associated with your business. Reworking your budget will also give you the ability to plan ahead to pay your creditors on time along with giving you the necessary tools to effectively manage your costs and reach your goal of reducing your overall debt.
Reduce Operating Expenses in Business
Take a long hard look at your operating costs and eliminate any services that are not crucial to the day to day operations of your business. Some great examples include temporarily suspending memberships, and cancelling unused or little used subscriptions. If you are leasing office space, you may want to consider downsizing to a smaller space, or subletting any space you are not using to reduce your rent. Contact your vendors to negotiation reducing prices, some companies provide discounts for services paid on an annual basis. Your financial statements are a valuable source of information that if utilized correctly can help you increase your cash flow and reduce your debt.
Find New Customers & Increase Customer Sales
The key to a successful business is reducing costs while increasing sales. Consider ramping up your sales by offering discounts to repeat customers. Keep a close check on your accounts receivables by collecting outstanding payments from your clients, for example offer a discount for outstanding fees paid in full up front.
Communicate with Creditors
If you are falling behind on your payments, keep a close check on what you owe by prioritizing your payments. Your cash flow statement can be particularly helpful in identifying missed payments and accounts in poor standing. Once you have determined how much money you can pay down, contact your creditors to arrange payment. Ask about available loan consolidation programs which can combine loans into a single monthly payment. Ask about plans that can lower your current interest rate.
Tax Preparation, Filing & More in Summerlin, North LV, Henderson, Lone Mountain Village & Greater Las Vegas, Nevada
To learn more about restructuring and reducing your business debt, for your Las Vegas business, contact the knowledgeable experts at Mecham Dicus & Company today, for all of your accounting needs including, business consulting, and tax services.