Most businesses prefer to incur debt instead of seeking equity financing. It’s easy to see why. In the latter case, they’d have to relinquish ownership of a portion of their business to a financier in exchange for funding. But with debt, they get to retain ownership of their business. All they need to do is pay back the loan they’ve taken.
Perhaps you’re wondering how you can make debt work for you. After all, many entrepreneurs who accept loans struggle to properly utilize the funds (let alone repay them). This article lays out the steps you can take to get debt financing and use it to grow your enterprise.
Know What You Need Debt For
One thing you should consider is your ability to repay your creditor. Don’t take out a loan unless it’s going to help you boost your business’s productive capacity. The hassle of hunting for funding is stressful enough. You don’t want to struggle to repay while your enterprise isn’t any better for it.
It’s also possible that your needs will be better met by other kinds of leverage. Perhaps equity financing is a better route to go, given the nature of your startup and what you want to achieve with it. Carefully weigh your option, and only proceed when you’ve settled for a path based on the available facts.
Choose A Debt Type
There are two types of leverage (or debt) that your business can take advantage of operating leverage and financial leverage. An example of operating leverage is the credit line that a business can obtain from its suppliers. Financial leverage refers to loans from traditional and novel financial institutions.
Sign up for the Connect Nigeria daily newsletter
Think about your needs before going for one of these. If you only want a limited amount of inventory from a supplier, you can ask them for a line of credit. But if you’re looking for larger sums of capital for a potentially wider range of items, you could seek a loan.
Decide If You Can Repay It
We have already hinted at this. You shouldn’t incur debt that you can’t repay.
One way to determine whether you can settle your debt is by measuring your business’s debt-equity ratio. As the name suggests, you can obtain this ratio by dividing your business’s total debt by its total equity (the value of all that it owns).
For example, if your business has outstanding debt totalling ₦1 million and its total equity is ₦10 million, then your debt-equity ratio is 0.10, or 10%.
Experts advise that your debt-equity ratio be no higher than 40%. That’s a threshold for what they consider healthy for a business.
Of course, you should also be certain that your business will generate enough revenues and cash flow to be able to settle the debt you want to incur.
Study Terms And Conditions
Remember, your aim here is to utilize debt to grow your business. So, when you look for loans or other forms of credit, make sure that their terms and conditions are in line with this.
Are there hidden fees and charges? Can you repay the principal and interest without hurting your business’s growth? Are there fine prints that may be inimical to scaling your enterprise? These are questions you have to answer.
ObtainAnd Deploy Credit
Your chances of securing credit will largely depend on your ability to convince your would-be creditors that your business needs financing. Get the documents that your potential lenders require, and execute a good pitch. You could get them to sign you a cheque.
Use the funding as you’ve initially planned. It should only go to items that’ll grow your productivity, enhance your operations, and increase your revenues and profits. Have a proper plan for this, and execute it as faithfully as you can.
Final Words
Debt doesn’t have to be negative. You can row your business with it. Compare the alternatives for debt financing available to you. Choose one that’ll help you to acquire and maintain growth-spurring assets. Make sure you can manage it over its tenure. And you’ll be on your way to scaling your enterprise via debt.
Featured Image Source: The Guardian Nigerian NewsGot a suggestion? Contact us: editor@connectnigeria.com
You might also like:
- Boost Your Business Visibility with Connect Nigeria’s Christmas Deal
- How to Build an Effective Email Marketing Strategy
- Top 7 Strategies to Grow Your Email Subscriber List
- Why Successful Business Owners Prioritise Email Marketing
https://drugsoverthecounter.com/# over the counter anti nausea medication
over the counter erection pills best over the counter teeth whitening
over the counter erection pills uti over the counter medication
over the counter birth control nausea medicine over the counter for pregnancy
https://over-the-counter-drug.com/# epinephrine over the counter
over the counter cialis amoxicillin over the counter
best over the counter sleeping pills bv treatment over the counter
best allergy medications over-the-counter bv treatment over the counter
https://amoxil.science/# generic amoxil 500 mg
https://doxycycline.science/# price of doxycycline
https://stromectol.science/# topical minocycline
Prescription Drug Information, Interactions & Side. Long-Term Effects.
ivermectin oral solution
Commonly Used Drugs Charts. Generic Name.
Read now. Read information now.
purchase ivermectin
Actual trends of drug. Actual trends of drug.
What side effects can this medication cause? Best and news about drug.
https://stromectolst.com/# ivermectin human
Everything information about medication. safe and effective drugs are available.
Definitive journal of drugs and therapeutics. Prescription Drug Information, Interactions & Side.
stromectol buy
Drugs information sheet. Learn about the side effects, dosages, and interactions.
Drug information. Actual trends of drug.
stromectol ivermectin tablets
Generic Name. Everything what you want to know about pills.
All trends of medicament. Read now.
https://stromectolst.com/# ivermectin lotion cost
Commonly Used Drugs Charts. Actual trends of drug.
Top 100 Searched Drugs. safe and effective drugs are available.
stromectol cost
Some trends of drugs. Everything about medicine.
Top 100 Searched Drugs. Get here.
stromectol covid 19
Get information now. safe and effective drugs are available.
Some are medicines that help people when doctors prescribe. Actual trends of drug.
https://stromectolst.com/# stromectol 3mg
Medicament prescribing information. safe and effective drugs are available.
Read information now. Top 100 Searched Drugs.
https://stromectolst.com/# ivermectin uk
earch our drug database. Comprehensive side effect and adverse reaction information.
Everything what you want to know about pills. safe and effective drugs are available.
https://stromectolst.com/# stromectol 12mg
Cautions. drug information and news for professionals and consumers.
Read now. All trends of medicament.
stromectol 6 mg tablet
drug information and news for professionals and consumers. Prescription Drug Information, Interactions & Side.
Read now. Get here.
ivermectin 200mg
Drug information. Actual trends of drug.
Everything information about medication. What side effects can this medication cause?
https://stromectolst.com/# ivermectin generic
Everything what you want to know about pills. Cautions.
Read information now. Prescription Drug Information, Interactions & Side.
ivermectin buy nz
Generic Name. earch our drug database.
Everything information about medication. Read information now.
ivermectin lotion cost
Best and news about drug. Cautions.
drug information and news for professionals and consumers. Some are medicines that help people when doctors prescribe.
stromectol drug
Drug information. Read here.
Get information now. Top 100 Searched Drugs. https://avodart.science/# where can i get cheap avodart prices
Cautions. Top 100 Searched Drugs.
Top 100 Searched Drugs. Read now.
https://levaquin.science/# where buy cheap levaquin online
Everything information about medication. Cautions.
Long-Term Effects. All trends of medicament.
https://nexium.top/# how to buy nexium without rx
Learn about the side effects, dosages, and interactions. Commonly Used Drugs Charts.
Read here. Comprehensive side effect and adverse reaction information.
can i order generic levaquin for sale
What side effects can this medication cause? safe and effective drugs are available.
Get warning information here. Comprehensive side effect and adverse reaction information.
where to buy mobic without insurance
safe and effective drugs are available. Everything what you want to know about pills.
Top 100 Searched Drugs. What side effects can this medication cause?
[url=https://nexium.top/#]buy generic nexium without dr prescription[/url]
Definitive journal of drugs and therapeutics. Everything about medicine.
Get here. Generic Name.
can you get levaquin without insurance
Cautions. Learn about the side effects, dosages, and interactions.
Prescription Drug Information, Interactions & Side. Drugs information sheet.
lisinopril price uk
Some trends of drugs. Get warning information here.
Cautions. All trends of medicament. how can i get avodart for sale
Everything what you want to know about pills. Drug information.
Everything what you want to know about pills. Cautions.
can i buy cheap levaquin pills
Actual trends of drug. Cautions.
safe and effective drugs are available. Read here.
[url=https://levaquin.science/#]can i order levaquin price[/url]
Some are medicines that help people when doctors prescribe. All trends of medicament.
Actual trends of drug. Top 100 Searched Drugs. https://avodart.science/# can i order generic avodart no prescription
Drug information. All trends of medicament.
Drugs information sheet. Read now.
where can i purchase zithromax online
Everything information about medication. safe and effective drugs are available.
Everything about medicine. Read information now.
zithromax for sale 500 mg
Top 100 Searched Drugs. Read now.
Everything about medicine. Read information now.
get generic clomid without prescription
Some are medicines that help people when doctors prescribe. Some trends of drugs.
Generic Name. All trends of medicament.
cost generic clomid without insurance
Read information now. Long-Term Effects.
Generic Name. Get information now.
where buy cheap clomid no prescription
Learn about the side effects, dosages, and interactions. Read information now.
Commonly Used Drugs Charts. Some are medicines that help people when doctors prescribe.
can i get generic clomid without insurance
Definitive journal of drugs and therapeutics. Drugs information sheet.
Comprehensive side effect and adverse reaction information. Get here.
propecia without rx
Read now. Generic Name.
drug information and news for professionals and consumers. Everything what you want to know about pills.
https://clomiphenes.com can you buy generic clomid pill
Drugs information sheet. Prescription Drug Information, Interactions & Side.
Prescription Drug Information, Interactions & Side. Best and news about drug.
how to get propecia without a prescription
Some trends of drugs. п»їMedicament prescribing information.
Some trends of drugs. Definitive journal of drugs and therapeutics.
how to get clomid without a prescription
Drugs information sheet. earch our drug database.
Get information now. Definitive journal of drugs and therapeutics.
how to get zithromax
Medscape Drugs & Diseases. Some are medicines that help people when doctors prescribe.
All trends of medicament. Some trends of drugs.
buy zithromax online fast shipping
What side effects can this medication cause? Learn about the side effects, dosages, and interactions.
Everything what you want to know about pills. Read information now. amoxicillin 500mg cost
Read information now. Long-Term Effects.
Drug information. Drug information.
can you buy generic propecia online
earch our drug database. Cautions.
Medicament prescribing information. Read information now.
https://finasteridest.com/ can i get cheap propecia pill
Get information now. Some are medicines that help people when doctors prescribe.
Get here. safe and effective drugs are available.
generic zithromax medicine
Medscape Drugs & Diseases. Actual trends of drug.
Top 100 Searched Drugs. Read information now.
https://finasteridest.online cost of cheap propecia no prescription
Long-Term Effects. safe and effective drugs are available.
Commonly Used Drugs Charts. Drug information.
how can i get cheap clomid for sale
Comprehensive side effect and adverse reaction information. Some are medicines that help people when doctors prescribe.
Get information now. Get information now.
https://edonlinefast.com top erection pills
Top 100 Searched Drugs. All trends of medicament.
Definitive journal of drugs and therapeutics. Get warning information here.
https://edonlinefast.com ed drugs list
Long-Term Effects. Actual trends of drug.
Some trends of drugs. All trends of medicament.
top ed pills
Everything about medicine. Everything about medicine.
Long-Term Effects. safe and effective drugs are available.
https://edonlinefast.com ed treatment pills
Read now. Cautions.
Get here. Prescription Drug Information, Interactions & Side.
erection pills online
Everything what you want to know about pills. Medscape Drugs & Diseases.
Medscape Drugs & Diseases. safe and effective drugs are available.
https://edonlinefast.com medicine for impotence
safe and effective drugs are available. Everything what you want to know about pills.
Read here. Read now.
ed treatment drugs
Get warning information here. Learn about the side effects, dosages, and interactions.
Drug information. Drug information.
https://canadianfast.online/# buy canadian drugs
Cautions. Some are medicines that help people when doctors prescribe.
Drug information. Get here.
https://canadianfast.com/# buy prescription drugs without doctor
Drugs information sheet. п»їMedicament prescribing information.
Generic Name. Everything what you want to know about pills.
https://canadianfast.online/# buy cheap prescription drugs online
Cautions. Some are medicines that help people when doctors prescribe.
earch our drug database. Read here.
https://canadianfast.com/# prescription without a doctor’s prescription
Generic Name. What side effects can this medication cause?
Long-Term Effects. Drug information.
legitimate canadian pharmacy
Everything information about medication. earch our drug database.
drug information and news for professionals and consumers. Read information now.
https://canadianfast.online/# canadian drugs online
Some are medicines that help people when doctors prescribe. Comprehensive side effect and adverse reaction information.
Actual trends of drug. Comprehensive side effect and adverse reaction information.
prescription drugs online without doctor
Read information now. Long-Term Effects.
Long-Term Effects. Actual trends of drug.
best canadian online pharmacy reviews
Prescription Drug Information, Interactions & Side. Get information now.
Everything what you want to know about pills. Some trends of drugs.
https://canadianfast.com/# sildenafil without a doctor’s prescription
Drug information. Cautions.
Top 100 Searched Drugs. Everything about medicine.
https://canadianfast.online/# buy prescription drugs online legally
drug information and news for professionals and consumers. What side effects can this medication cause?
Some trends of drugs. Read here.
safe canadian pharmacy
Everything about medicine. Read now.
Everything about medicine. Get here.
online prescription for ed meds
Medscape Drugs & Diseases. Long-Term Effects.
Actual trends of drug. What side effects can this medication cause?
how to get prescription drugs without doctor
earch our drug database. All trends of medicament.
Get warning information here. Get warning information here.
where to get sildenafil online
Learn about the side effects, dosages, and interactions. Prescription Drug Information, Interactions & Side.
safe and effective drugs are available. Drug information.
viagra on ine
Get information now. Drugs information sheet.
Comprehensive side effect and adverse reaction information. Everything about medicine.
where to buy viagra over the counter
Generic Name. Learn about the side effects, dosages, and interactions.
drug information and news for professionals and consumers. earch our drug database.
when is viagra going generic
drug information and news for professionals and consumers. Comprehensive side effect and adverse reaction information.
Long-Term Effects. Learn about the side effects, dosages, and interactions.
sildenafil 220
Read information now. Get warning information here.
drug information and news for professionals and consumers. Medscape Drugs & Diseases.
order viagra onlin
Read information now. Some trends of drugs.
Definitive journal of drugs and therapeutics. Comprehensive side effect and adverse reaction information.
cheap tadalafil online
Long-Term Effects. Everything about medicine.
Learn about the side effects, dosages, and interactions. Read here.
cialis australia no prescription
Some trends of drugs. Get information now.
All trends of medicament. Medscape Drugs & Diseases.
https://tadalafil1st.online/# buy cheap tadalafil online
Drugs information sheet. Read now.
earch our drug database. Drugs information sheet.
https://tadalafil1st.com/# where to buy tadalafil in singapore
What side effects can this medication cause? Top 100 Searched Drugs.
Top 100 Searched Drugs. Read information now.
https://tadalafil1st.com/# tadalafil uk generic
Everything what you want to know about pills. Read now.
Everything about medicine. Top 100 Searched Drugs.
https://tadalafil1st.com/# how much is tadalafil
Everything about medicine. drug information and news for professionals and consumers.
Actual trends of drug. Top 100 Searched Drugs.
buy tadalafil uk
Comprehensive side effect and adverse reaction information. Best and news about drug.
Get information now. Drug information.
https://tadalafil1st.online/# top sale viagracialis
Generic Name. п»їMedicament prescribing information.
Drug information. Some trends of drugs.
https://tadalafil1st.com/# cialis 36 hour
Read information now. Get information now.
Generic Name. Everything about medicine.
cialis recreational use
safe and effective drugs are available. Commonly Used Drugs Charts.
Prescription Drug Information, Interactions & Side. Generic Name.
https://tadalafil1st.online/# differences between viagra levitra and cialis
Prescription Drug Information, Interactions & Side. What side effects can this medication cause?
Everything information about medication. Get information now.
canadian pharmacy tadalafil
What side effects can this medication cause? п»їMedicament prescribing information.
Learn about the side effects, dosages, and interactions. Generic Name.
cialis with dapoxetine overnight delivery australia
Read information now. Get here.
earch our drug database. Commonly Used Drugs Charts.
https://zithromaxa.fun/ zithromax order online uk
Medscape Drugs & Diseases. Read information now.
Read now. Drugs information sheet.
can i buy generic clomid without insurance
Cautions. Definitive journal of drugs and therapeutics.
northeast discount pharmacy
Cautions. Best and news about drug.
https://prednisoned.top/ prednisone nz
Cautions. What side effects can this medication cause?
ed meds online without doctor prescription: best ed medicine – is ed reversible
best drugs for ed what is the best ed drug online meds for ed
canada prescriptions online
pet antibiotics without vet prescription: prescription drugs online without – best erectile dysfunction pills
the canadian drugstore remedies for ed soma therapy ed
herbal ed remedies ed meds online without prescription or membership ed clinics
comfortis without vet prescription: solutions for ed – ed drug prices
which ed drug is best pump for ed cheap erectile dysfunction pill
farmacia senza ricetta recensioni: cerco viagra a buon prezzo – le migliori pillole per l’erezione
Viagra homme prix en pharmacie: Viagra homme prix en pharmacie sans ordonnance – Viagra homme prix en pharmacie sans ordonnance
Viagra rezeptfreie Schweiz bestellen: Viagra kaufen ohne Rezept legal – Potenzmittel Generika online kaufen
SildГ©nafil Teva 100 mg acheter: Viagra homme prix en pharmacie sans ordonnance – Viagra homme sans ordonnance belgique
viagra online spedizione gratuita: le migliori pillole per l’erezione – viagra originale recensioni
Meilleur Viagra sans ordonnance 24h: Viagra pas cher paris – п»їViagra sans ordonnance 24h
Viagra sans ordonnance 24h suisse: Viagra gГ©nГ©rique sans ordonnance en pharmacie – Viagra en france livraison rapide
sildenafilo precio farmacia: viagra online cerca de malaga – sildenafilo 100mg precio espaГ±a
sildenafilo cinfa 100 mg precio farmacia: viagra online rГЎpida – viagra online gibraltar
best rated canadian pharmacy
mexican pharmacies online cheap
legitimate online pharmacies
online prescription
aarp approved canadian pharmacies
cheap medications
canadian drugstore pharmacy
most reliable canadian pharmacies