“This debt is strangling my business.”
I hear this from clients, and I see the weight of it in their financials.
Where did this debt come from? Often from well-meaning organizations that sold them the wrong debt solution.
💡 Looking to make payroll and buy supplies? Short-term debt
💡 Looking to replace a capital asset (e.g., machinery) that has a life of 10+ years? Longer-term debt (that is paid off in less than 10 years).
🪙 The morale: avoid long-term debt (past a year) for a short-term cash flow solution.
The burden of debt slows enthusiasm and lowers productivity, from a spunk for sales to a lacklustre delivery of products or services.
You can’t outrun debt.
You can’t out-volume debt.
Whether you refinance it, cut operating costs, or build robust forecasts to address it, debt has to be recovered in the margins of your business somehow.
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