Are business Problems Due To Entangled Accounts Payable? This is the solution



In the business world, debt is normal. Accounts payable are sometimes needed for various things, for example as initial capital for a business, capital to develop or expand a business, or to meet the operational needs of the business.

Running a business involving debt will not be a problem if you can manage the loan money wisely, according to what was planned. However, if the loan cannot be utilized properly, it could become a business debt that results in worsening business conditions and can even lead to bankruptcy.

Starting a business and running it is not easy, and crucial financial problems often occur. If there is a very urgent condition, for example, when a business requires an injection of capital to ensure its sustainability, the business actor may go into debt without thinking. Indeed, this is not wrong, as long as a good strategy has been made to be able to pay the installments of the business debt to pay it off.

For those of you who are running a small business or MSME, you have to think seriously and be able to read the situation before deciding to go into debt or apply for a loan, be it to friends, relatives/relatives, banks, cooperatives, online loans, and so on. You must be able to plan the use of these loan funds properly so that they have a positive impact and progress for your business.

In order not to get caught up in the piling up of business debt that makes the business you run stumble or even go bankrupt, here are some tips for managing loan funds, as well as solutions if the business is experiencing accumulated debt.


1. Calculate the total accounts payable
Calculate carefully the total amount of business debt you have. If there are indeed several types of trade payables, for example, debts to banks or relatives for additional capital, debt to suppliers, and so on, you should make separate records regarding each debt, the payment scheme (how much principal and interest), and maturity. With neat records, you will see the amount and remaining obligations that you have to pay next.


If you have trade payables to more than one party, include them all in your business financial records, complete with the amount and the due date. It's even better if you use an application to help with financial bookkeeping, so that everything is more planned, including expenses for debt payments. This kind of application also usually comes with a reminder feature to ensure timely payment.

2. Make a plan regarding the settlement of trade payables
If you owe a bank or other official financial institution, of course, there is a clear installment payment agreement and scheme, so you know when you can pay it off unless your business is in a really difficult financial condition so you can't pay the installments and pay it off. on time.

If something like this happens, your debt will increase due to late payment penalties. You can try to apply to the bank to get payment relief, for example with a lower interest rate and a smaller number of installments, but with a longer repayment period. Besides, owing to the bank usually requires collateral or assets, which the bank will confiscate if you are unable to pay it off.


What if you owe a relative? Usually, there are no guarantees and formal agreements, and there is no pressure to pay off immediately. However, you should still have to make a separate debt record regarding the amount that has been paid and how much your remaining obligations are.

Ensuring that your obligations are paid the right amount and on time must be a priority. If necessary, you can postpone other expenses that are not urgent in your business operations.

Checking loan balances regularly can also motivate you because you can be more confident and motivated to be able to pay off your business debts by seeing the total debt that continues to decrease. Start applying weekly and monthly goals for how much to pay off.

3. Calculate between income and ability to pay
Having large debts does not necessarily mean that you can advance your business or improve your financial condition. If the loan funds are not used properly, it may cause the business condition to be worse than before the debt.

Business finances will be unhealthy if the amount to be paid is greater than the income. This will make it even more difficult for you to pay, and get caught in debt bondage.


So that repayment does not interfere with the running of the business, do a careful calculation regarding the ability to pay by adjusting the income and the number of installments that must be paid, as well as other expenses. Try it

By adjusting the ability to pay with income, you can find out the amount that must be set aside to pay off your obligation until it is paid off.

4. Apply payment automation
Automate payments for the bills you have every month, including loan payments, so you can get out of the ensnaring debt. This can be done by auto-debit in your account. It takes a lot of determination and willingness to always pay these bills on time.

5. Selling assets to pay off debts
Selling assets can be a quick way to pay off debts until they are paid off, so you don't have to linger in installments. If the money from the sale of these assets is still left, you can use it as capital to continue your business.

Hopefully, some of these tips can help you in managing the business debt that you have, so you don't let the debt hinder the development of your business.

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