Why Refinancing is The Key to Business Success
Have you ever felt under pressure and out of control with your business finances? Far too often small and medium business owners get wrapped up in the never ending cycle of bills and repayments, only to lose focus on the things that matter most.
If you’re struggling to cope with the day to day cash flow of your new business, you’re not alone. A staggering 80% of new businesses fail within the first 18 months of operation, with the vast majority of these businesses simply running out of cash.
While there is undoubtedly a myriad of factors that contribute to a cash shortfall, many entrepreneurs make the mistake of either launching a new business without enough capital, or underestimated the initial income their new endeavour would generate.
Naturally, once you start trying to back pay after an initial hiccup in your financing, it doesn’t take long for things to snowball. And it’s not just start up’s that suffer the cash flow trap.
Whether it’s disruptions to the supply train, interest hikes, rental increases, equipment failure or stock loss, unexpected expenses can take a massive toll on a delicately balanced budget.
Suffering from setbacks doesn’t need to mean the end, however, with a simple solution readily available to straighten things out and get you back on track and powering ahead.
Refinancing – What it Means for You
Breaking up with your current lender
For some, refinancing might simply involve breaking up with a current lender and slashing weekly loan repayments. It’s not uncommon for some lenders to charge an effective rate up to 100%, making it nearly impossible to spend your money where it’s needed – not in repayments.
Simply by doing some research and talking to reputable market leaders, you can find unsecured loans available for as little as 7% interest pa. Think about the savings from that?!
Consolidate your debt
Perhaps you have a loan that’s under control yet other bills and expenses have taken grip? Quite often it’s not just the money itself that is the problem, it’s the time and stress spent constantly dealing with different suppliers, keeping track of bills and dues dates, and losing sleep trying to prioritise payments.
Using a flexible Smartbiz loan to consolidate your debt into one easy payment will not only save you money in overdue fees, it brings a host of benefits that have a direct impact on the success of your business.
Use your time and money where it’s needed
You are the cornerstone of your business, and by creating time and financial control through refinancing you can refocus your energy into improving your operations. What could you do with the extra 10+ hours and thousands of dollars a month you’ll save to prevent future cash fallouts?
Invest in marketing
If you have issues with your initial expected income, or have had a slow season, investing your savings into marketing can help build brand awareness and generate sales or leads.
Recruit new talent
There is no denying that success is in the staff. If you’re running a one (or two or three) person show and one person is constantly chasing bills and paperwork, it won’t take long for your business to bear the brunt. Invest in extra hands, whether it’s one off contracting, casual staff or a new leader, people are power.
Upgrade your equipment
Investing in high quality equipment now can save you down the track. Not only that, having the right equipment will allow you and your employees to optimise work flow, efficiency and quality, culminating in better product and services.
Invest in new opportunities
Whether you want to diversify your offerings by investing in new stock, open a second location, or work on a new piece of technology or software, branch out to take new opportunities. Providing they align with your business goals, new opportunities give you the ability to strengthen your value proposition and help carve out a strong space in the market.
There is no underestimating the impact financial stress can have on a business owner and their staff. Trying to run a business with enthusiasm and energy when you’re battling stress and anxiety over unpaid bills or tight cash flows is not fun. Refinancing can help alleviate this pain, giving you the chance you need to breathe, take a break and reconnect with your business.
Refinancing doesn’t just mean money in your pocket when you need it, it means taking back the power and achieving success. Our team of Smartbiz experts are market leaders and can walk you through the process of refinancing, with no cost or obligation to you.
To start the refinancing process or talk to one of our team, simply fill out an application today. Your solution could be minutes away.
Disclaimer: Information is of a general nature. Please consult your Account or Financial advisor for advice.