Euro Finans AB | Jun 27, 2023 1:37:16 PM

10 occasions when a fast business loan may be a smart move

As owner of the business, it’s up to you to decide whether a business loan is the correct solution for you just now. Borrowed money may be the smartest way to make an important investment quickly or to overcome temporarily insufficient liquidity. Here we have collected a number of situations where there may be good reason to take a short-term loan to solve temporary capital requirement

Buy now in order to be able to invoice later

Some contracts require your company to pay out more money than you have in your account. At the same time, this expenditure is a prerequisite for being able to complete and invoice for the job. You may, for instance, need to buy more material than usual or to hire expensive machinery which will temporarily increase your costs. As you know that money will be paid into your account when the job has been completed, you can solve your liquidity problem by a simple short-term business loan.

Buy a lot at once

If your supplier has a good offer if you buy a lot at once, or has perhaps found a consignment of goods that fits perfectly in your web store. Sometimes such offers crop up, on those occasions which are almost too good to be true. A transaction which will increase your profitability for a long period to come. Make a quick calculation and think about whether it might be worthwhile to raise a fast and flexible business loan. If the profit from the transaction is greater than the cost of the loan, it might be a good solution which will soon pay for itself.

Accept a large order

If you are a good at running a business, sooner or later opportunities will occur which you don’t want to miss; perhaps an important dream customer whom you have wanted to work with for a long time will get in touch about a big job or an extensive procurement requires that you pay money in advance. You often need money to be able to earn money. In this situation, a business loan can be a convenient way for you to win this business.

"You often need money to be able to earn money. In this situation, a business loan can be a convenient way for you to obtain this business."

To secure a tax payment

There are some liabilities that you absolutely don’t want to miss paying, taxes, for example. Keep a check on your tax account and make a careful plan for how much you have to pay in for value-added tax and to avoid getting into arrears with employer’s social security contributions. It can be both expensive and lead to a deterioration of your future prospects if you fail to make payments on time. If your company has fundamentally sound finances, it is often better to take a fast business loan on your terms than to be in debt to the Tax Agency.

Always pay your employees’ wages

When you carry out a contract, it is often the case that you receive payment a long time after the job has been completed. At the same time, you probably have employees who want to receive their salary on the 25th each month. Sometimes this gap becomes too large. It can be very awkward to wait for money from customers and at the same time pay wages in time despite the work already having been performed. It is important not to lose the trust of your employees, that they are confident that their employer will pay what is due to them. A business loan does entail an additional cost, but it can be still more expensive if an important employee gives notice to quit or that you would be unable to accept a contract due to shortage of staff.

Make an important investment

Every business owner knows that you have to dare to win. At the same time, it is almost always the case that you incur costs before receiving income. It may be difficult to realise your ideas if you do no have money of your own to invest. You understand and know your own business best and you know what a good investment can mean for your business. This might be new machinery, expanded stocks or a smarter logistics solution which will improve profitability or offer new business prospects. A business loan may be a way of getting through the period when the costs have been incurred before you have started to receive incoming money.

Launching in a new market

Your product sells like hot cakes here in Sweden and you realise that it would be a success if you introduced it into another country as well. However, starting to work up a new market can be initially expensive. You’d need a sales organization, new contracts, marketing and perhaps premises tot work from. At the same time, you know that it would only be a matter of time before the business achieved the same fine figures as here in Sweden. A business loan could get you through the start-up phase in a new market until you start to receive earnings.

"A business loan could get you through the start-up phase in new market until you start to receive earnings."

Technology update

A revolutionary new technological solution is available or you have finally cracked the problem of how to automate part of the manufacturing process. The fast development of technology may mean that your competitors rapidly get ahead of you, or that you get head of them. Development of technology costs money and can rapidly change the rules of play in a market. Do you know of an investment in new technology that would make your business more competitive but you don’t have the money for investment just now. A business loan may be the solution here – get started quickly, earn more money and pay back the loan as soon as you can.

Employ a key person

A single person can make the difference between fiasco and success. A really smart engineer, a sharp salesperson or someone who takes over your administrative tasks is perhaps the key to accelerating your business. Employees are also an investment and sometimes it takes a while before they are up and running in their new role. A solution may be to cover the start-up costs by a business loan until the new star is able to contribute to the company’s higher costs.

Re-finance

If you are in a situation with a lot of expensive and bad loans, or perhaps a leasing agreement which has proven to be a poor decision. Then it might be the right time to review the situation and get rid of the worst creditors. Raise a fast, quick, simple and good business loan that you can keep an eye on instead.