Money matters

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     to help you better manage your small business.

     There is never enough money to do all the things you want to do in small business. Money--and cash flow--is always a problem.

     When income is greater than expenses, you can point to a healthy bottom line. There's some money left over to grow, expand, buy a new piece of equipment, hire another employee--or take on repayments on a loan. 

     Sometimes, there is money to do all the things you want to do. But that is rare. Your dreams are bigger than your pocketbook allows. Or you want to grow faster than your bottom line supports--an infusion of additional cash can put you on the road to faster growth. 

     This is when you look to borrow the money you need. Sources like banks don't loan to small businesses like they once did. Credit cards are very expensive alternatives--be very careful using them. Borrowing from friends and relatives is not a good idea--unless you draw up an agreement with specific terms.

     Enter the net. In recent years, several firms have popped up offering to do business loans. They make it easy and quick. But you pay for that in interest. Do a Google search for "Business loans" and check carefully the listings. You might find one that suits you--some specialize in loans only to small business, say $2,000 to $20,000. Others are looking to make larger loans. 

     Another Internet source is "Crowd funding" and it means just what it says. If you have a great idea or an appealing business model, you might attract a large crowd of people who are willing to invest in you and your business. Some of these are structured as loans; others involve equity, or part ownership, in your business. To check it out, Google "Crowd funding" and read through the sites you find.

     Small, local businesses can also look for private investors locally. Say you run a landscaping business, a beauty salon, a health food store, an auto repair shop, a veterinary practice, or whatever. Among your customers and clients you might find one who is willing to invest in a local business rather than continue playing the stock market. You'll probably need an attorney to draw up an agreement, but this is very real possibility--one I have used myself. 

     The key here in any of this is your cash flow. If your bottom line shows that your business can support a monthly loan repayment, then a loan is possible. And if your business is healthy and growing, then it might attract a private investor. 

     Managing money in small business takes ingenuity, creativity, and a willingness to take risk. Taking a risk is not like rolling the dice. Taking a risk is seeing a path forward--with some degree of certainty.