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7 Tips to Dig Your Business Out of Debt

A lot of businesses have struggled to say in the black since last march when the Covid-19 pandemic started. Both established businesses and startups took a hit. Many had to reduce their operating hours, admit fewer customers to brick and mortar stores, or even shut down temporarily. Without a consistent source of income, many business owners found themselves in debt. Now, everything is starting to reopen and it’s time to get your financial health back in order. Below are some tips to get you out of debt, and back to making a profit.

Collect Unpaid Invoices

Insufficient cash flow is the most obvious reason for mounting financial concerns. This element is critical to the financial health of your business. The collection agents at SWR can help you remedy this problem. It’s understandable that many people are struggling to pay their bills amid mass layoffs and furloughs. However, when they don’t pay up that puts you in a position of financial insecurity. It’s smart to remain flexible but hold people with past due invoices accountable. Our collection agents are compassionate and understanding of your customers situations. For this reason, we customers who owe you money to recover the full amount in a timely manner by offering payment plans and educating them about debt repayment.

Payment Plans

Most people genuinely want to make good on their debts. The recovery agents at SWR can help put together a repayment plan that will make it easier for customers to pay. This will also provide you with a more consistent flow of cash so you can start paying off the debts you may have accrued when your customers weren’t able to make payments. 

Budget

While you’re waiting for SWR collection agents to collect past due invoices there are some other steps you can take to mitigate your expenses. You should start by prioritizing your bills. Taxes, payroll, and high-interest debts should be non-negotiable. You should pay these in full each month. You should also prioritize debts that has your personal property listed as collateral. If you default, you stand to lose expensive and valuable property like your home or car. Then, do your best pay the minimum amount of the rest of your debts or cancel accounts that aren’t completely necessary. 

Consolidate Your Loans

Times are tough. A lot of lenders are willing to refinance your loan or defer payments if you just ask. Submit a financial hardship letter to your lender, and try to renegotiate and restructure your loans. This can be a significant financial break until you can get back on your feet. 

Negotiate With Vendors

A lot of vendors and suppliers struggled with their bottom line during the pandemic. Now is a good time to negotiate discounts or request to use extra stock for sales. This will help them get rid of close-dated product and pad both of your profit margins. Just be careful about how you ask so they don’t lose faith in your ability to pay. 

Apply for Aid

If you’re falling behind on your bills because of the pandemic and customers who are dodging payment you can apply for grants. This is essentially free money that you can use for business expenses. This is an excellent option for business owners to alleviate some of the financial burnden on their shoulders. There are a surprising amount of grants out there that were specifically created to help keep businesses afloat during the pandemic. Do some research and see if your company meets the qualifications to be awarded free money.  

Crowdsourcing

Typically, when you operate a business you’ll develop a loyal customer base. In times of hardship, you may consider accepting donations. Crowdfunding platforms like Go Fund Me can be a great way to secure funds quickly. This is particularly effective for businesses that have a strong mission or have a history of giving back to the community. 

Southwest Recovery Debt Collection Services

It can be frustrating when you start to fall behind on your bills through no fault of your own. When you provide a service you expect to be paid for it. When customers don’t pay up then you can’t pay for your own expenses. We know you need to collect on outstanding debts to stay in the black. However, we also recognize that running a business takes a lot of time and effort. Contact the collection agents at SWR and we can handle collection efforts for you. This will free up your time to focus on your work, and with our efforts you’ll soon be paid for it as well.

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