When looking at what kind of debt to use, it may be helpful to consider the timeframe of the debt within the context of your business. If your business is seasonal, you might be able to afford extra repayments at a particular time of year. If you have predictable cash flow, it may be useful to schedule repayments for when you know you will have spare cash.
Size Does Matter
In general, the more you borrow, the cheaper it gets. Make sure that you are paying the best possible interest rate on any debt that you owe. It may be worthwhile consolidating a few loans in order to find a better rate across a larger amount. Don’t be afraid to push the envelope with your lender and ask if you can get a better rate.
Accessibility of debt is an important factor. If you are looking for a small loan, a big bank might not necessarily be the best fit; they might not be set up to deal with small loans. There are a number of highly accessible options available to SMEs including invoice financing, accounts receivable financing, and trade finance. These types of loans can often be applied for completely online without the need to visit a branch.