You’ve probably fantasized about how you would spend a million dollars if you won the lottery, but have you ever considered what you’d do with a little extra cash in your business? Your first instinct might be to throw a great office party or splurge on that fancy office chair you’ve got pinned on Pinterest, but there are better ways to spend money so that your business can make more of it.
If you’ve ever considered taking out a business loan, but weren’t sure what you’d do with the money, let these five ideas guide you.
1. Invest in Marketing
There are probably marketing tactics you’d like to try but haven’t, due to your small marketing budget. A business loan could give you the funds to try out online advertising, hire a content marketer to write your blog articles or beef up the custom graphics on your website.
Why it’s a good investment: the more money and effort you spend on marketing, the more it can help you attract more customers. You’ll quickly recuperate your expense if your marketing is successful!
2. Get Over a Dry Spell
Whether business has been slow or you’re biting your nails waiting for clients to pay their late invoices, having working capital can ensure that you can pay your staff and your vendors when cash isn’t flowing so freely. That’s where online alternative lenders come in handy: rather than taking out a large loan for $10,000 or more, you can borrow a modest amount to cover immediate costs, and pay that loan back quickly.
Why it’s a good investment: While you might assume that alternate lenders charge more for short-term loans, the fact that you’re paying them back in weeks, not years, may mean that you actually pay less in interest.
3. Hire Help
What would you do with an extra set of hands? You could get so much more done if you had even part-time help, and a business loan can make that a reality. If you hire someone, say, to take over your accounting, you then free yourself up to work on other aspects of your business, like strategy and sales.
Why it’s a good investment: You can’t do it all. And if you take out a loan to hire an employee or two, you will increase your capacity to earn more money.
4. Be More Productive
Is your technology out of date? Do you turn your computer on, go make a latte, check your voicemail and still it hasn’t loaded? This is actually costing you and your business money in lost productivity. If you had a business loan, that money could be put toward newer technology that allows you to do your work faster.
Why it’s a good investment: Staying up with the latest technology is a losing game, but so is trying to save money by not buying new hardware. Your team will be happier and more productive with newer computers, and tablets may serve interesting functions that make you more competitive.
5. Grow Your Business
Whether growth means expanding your office space, your staff or your product line, it’s going to cost money. Even if you have money in the bank, you don’t necessarily want to tie it all up in costs that won’t quickly net an ROI. Taking out a loan, on the other hand, gives you the cash to work on your growth strategy, while the money in your account is reserved for your usual expenses.
Why it’s a good investment: Taking a risk financially can give great rewards, but you have to be willing to invest in it. If you’ve done your research, and it shows that this investment will indeed help your business thrive, it’s worth the risk.
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