Does your business rely on credit, working capital? A recent study by the Ewing Marion Kauffman Foundation shows that nearly 60% of small businesses rely on credit cards, which provide funding for the operation during the early years. The study found that using credit cards to finance the early years of the likelihood of a company in the top 50% of starters who have failed within 4 years.
The survival of the debt Amazing as low as $ 1000 a significant difference in the ability of a company in the past, the 5 years. The model of the card to an increase in debt during the first 5 years of operation. These companies have begun to pay its debts at the end of the 4th year or two, that those who want to succeed. The additional burden of debt repayment of credit is often too important to some young companies that have succeeded elsewhere.
The growing use of credit cards to small businesses is the result of the ease with which the cards are not received, there is at most 2 years. They are easier to use than commercial loans or lines of credit for … Of course there are many other factors that impact the ability of a company to bring in these difficult economic times, but the use of credit, even in small quantities in the morning seem to be victims.
Unfortunately, new laws came into effect programs for personal credit cards have no effect on the credit industry companies. This report emphasizes the need to reform the same type of users of the credit industry as it is for personal loans. As I mentioned in a previous article by e-zine in June, when your personal card for business use and have more than $ 25,000 to reduce a high fee, your card as a calling card and is exempt Personal Credit legislation are considered.
Are you still withering personal credit card or for your business? Are you able to repay if you work with a balance of more and more each month? Apart from the 50% of the material by a conscious effort to reduce dependence on credit for things that money will reduce. Efforts to reduce these funds and ensure that you do not lose your shirt!
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