It is not uncommon for business owners to make costly mistakes that ultimately lead to debt. However, businesses usually fail to recognize that they are making these mistakes until it is too late and they are carrying a significant debt load and potentially facing a lawsuit (or several) over their delinquent debts. The key to preventing this is knowing what decisions are beneficial or what could be a potential mistake. Here are the eleven most common mistakes businesses make that lead to commercial debt:
- Using company funds for personal use
- Taking out high interest rate loans, taking out too many loans, or becoming over-leveraged
- Not having enough cash saved to get through a down time
- Giving an employee unsupervised access to company credit cards or funds
- Relying on credit cards to cover cash-flow shortfalls
- Unnecessary luxury expenses
- Not knowing the company’s financials thoroughly or following a budget
- Opening a business before a set plan is in place
- Never reading the documents they sign
- Not being consistent (or efficient) with collecting accounts receivables
- Investing in bad advertising or the wrong marketing channel
If your business is beginning to struggle with cash-flow and debt problems, download our free guide and learn about how to fix these costly mistakes. At Fuselier, we apply our years of experience to negotiate debt solutions that work for our clients, oftentimes saving them thousands of dollars. Contact us today to see how we can help you.
