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Taking loan to expand business - Heatman - 03-09-2018

Nothing boost one's business income like business expansion. This makes it possible for the business owner to have increased sales and turn over which generally adds to profit making. The major factor that holds back business expansion is funds, if there is enough cash at the disposal of any business business owner, definitely to expand the business would be his top priority.

Getting loans is one good way to source fund and expand one's business and with a physical business structure functioning already, there is good chance that banks would issue loan to the person involved in my own opinion. But I would like to hear other suggestions on how one can source fund apart from getting loans from banks to expand one's business.


Taking loan to expand business - Martin - 03-09-2018

Many sources of finance, depends what you are looking for and for how long.

Personal loans (borrow from a friend, your savings)
Overdraft if only needed for short term
Investors (angel/etc.)
Community funded projects such as Kickstarter
Retained profits

Loans are the best for expansion on a medium/large scale. But obviously you have to be weary of your business debt to asset ratio.


Taking loan to expand business - ghost - 03-09-2018

A loan can be quite risky and costly due to the high interest repayments. However for most people it is the only method they have to get money to expand a business. Caution is needed to make sure it is right for you.


Taking loan to expand business - Heatman - 03-10-2018

[quote quote=845]Many sources of finance, depends what you are looking for and for how long.

Personal loans (borrow from a friend, your savings)
Overdraft if only needed for short term
Investors (angel/etc.)
Community funded projects such as Kickstarter
Retained profits

Loans are the best for expansion on a medium/large scale. But obviously you have to be weary of your business debt to asset ratio.[/quote]

I don't see borrowing money from friends as a good option when you are looking for means to expand your business. Most people don't have the best intentions even when they seem to be your friends. One's savings is more favorable for me and also Kickstarter and Retained profits over a period of time. Overdrafts will kill your business instead help it.


Taking loan to expand business - fishbate - 03-12-2018

Business expansion is definitely a good step in any business. But borrowing money should be a last choice for acquiring fund for it. Borrowing money specially with high interest rates should be carefully planned. It could be a make or break, but with careful planning, you will have the right decisions on your finances.



Taking loan to expand business - KellyGeo - 03-12-2018

Over here, there are several micro finance banks that helps small scale businesses to fund their business. They give a reasonable amount of loan money with little interest, and allow for installment payments in clearing the debt. I have actually taken $500 loan from a micro finance bank to pay %15 interest on the money.


Taking loan to expand business - Heatman - 03-12-2018

[quote quote=854]A loan can be quite risky and costly due to the high interest repayments. However for most people it is the only method they have to get money to expand a business. Caution is needed to make sure it is right for you.[/quote]

There are some unrealistic loans, it's not all loans that are worth taking. If you check the interest rate, it should be first point of concern in taking the loan and also the mode of the repayment. If the interest rate is considerate, and it can be paid in installment, then I would say that the loan is worth taking. The only problem is when taking loan and not mapping out the best way to invest it, this makes misusing of the fund and finding it difficult to repay.


Taking loan to expand business - Heatman - 03-12-2018

[quote quote=1007]Business expansion is definitely a good step in any business. But borrowing money should be a last choice for acquiring fund for it. Borrowing money specially with high interest rates should be carefully planned. It could be a make or break, but with careful planning, you will have the right decisions on your finances.[/quote]

This is absolutely correct, when you fail to plan on your business programs, you have already planned to fail. No matter the amount of loan acquired to invest in the business, it's still won't be effectively used which would leave pores in the business and having it crash. This would leave the business in debt that would be difficult to repay.


Taking loan to expand business - Heatman - 03-12-2018

[quote quote=1026]Over here, there are several micro finance banks that helps small scale businesses to fund their business. They give a reasonable amount of loan money with little interest, and allow for installment payments in clearing the debt. I have actually taken $500 loan from a micro finance bank to pay %15 interest on the money.[/quote]

15% interest on a $500 loan from a micro finance bank isn't a bad one, and to also have the money paid back in installments makes it a lot easier to pay back without feeling chocked by paying the full amount at once.


Taking loan to expand business - iamjoeymercado48 - 03-15-2018

[quote quote=1007]Business expansion is definitely a good step in any business. But borrowing money should be a last choice for acquiring fund for it. Borrowing money specially with high interest rates should be carefully planned. It could be a make or break, but with careful planning, you will have the right decisions on your finances.[/quote]

I am totally agree with this one, Borrowing money should be the last option where you are in the point of expanding your business. Business expansion is good sign that you are in the right track that your business will have the possibility that it will earn or currently earning higher than you are expectation. But if the case you need to borrow I should have said that maybe it is better to wait a little more time until you have enough funds to expand your business and it is good to know that you will expand your business and the earnings will be 100% yours and not 100% payment for debt.