At some point in the growth of their businesses, many entrepreneurs consider taking out a loan to be able to further expand. Low interest loans from the U.S. Small Business Administration provide companies with working capital for a variety of purposes. Here are some of the reasons that an SBA loan might be the right move for your company.
Purchase Equipment or Inventory
If you sense that it’s the right time to grow your business but you lack the funds to buy the equipment or inventory to put you over the top, an SBA loan might be just what you need. Certain expensive pieces of equipment are integral to the running of many types of companies. Additionally, sometimes you need to have large amounts of inventory on hand in order to expand, especially if your business is seasonal.
When businesses start up, entrepreneurs themselves often perform many of the essential tasks that need to be done. However, once you reach a certain stage of growth, you may need to take on more personnel. New employees can handle the accounting, marketing, customer service, and other vital jobs so that you can focus on running the company.
If business is booming, you’re hiring new employees, and customers are eagerly purchasing your goods or seeking your services, you may find that the location you first started out in is inadequate to meet your growing needs. An SBA loan can help you expand your present location or move and set up in a new one.
Besides the advantages of assisting you in improving or shifting your location, hiring personnel, and acquiring needed equipment and inventory, taking out an SBA loan helps you build credit for future financing. To ensure this credit-building capability, before you obtain a loan, have the confidence that you can always make the payments in full and on time.
For more advice on taking out SBA loans to expand your business, contact Capital Connex.