Have you decided to start your small business and enjoy the financial independence it offers? If so, welcome to entrepreneur life!
Having a small business is definitely a great way to make your business idea viable while also generating employment opportunities for others in the community. However, one of the essential things to start or maintain your business is the continuous flow of adequate finances.
Finance will always be the critical component of any business. It is not just about funding your business operations but also promptly providing adequate monetary compensation to your team. So, you must make sure you know your financing options to find adequate finances for your business.
Here are some financing options curated by our experienced business coach Australia that you can check out right now.
Peer-to-peer lending
If you find it difficult to get traditional funding, you can choose to go for peer-to-peer landing. This involves taking funding from a group of individuals who are eager to invest in new and budding businesses. Lower interest rates and flexible repayment policies are some of the benefits of peer-to-peer landing.
To apply for peer-to-peer landing, you need to access an online portal that helps borrowers match with the right investors. While using such a portal, make sure about its authenticity. Also, you may need to provide information regarding your business and your financial history as a business.
Business Loans
If you are just starting to find business financing options, we suggest you go for business loans. This is a traditional financing option for several businesses and might be one of the safest options. You can get business loans for different types of business requirements such as hiring staff, purchasing equipment, business expansion, and more such business operations.
You can find unsecured and secured loans, with each having its terms and conditions. For example, the repayment terms and interest rates will depend on the lender and the type of business loan you take. Despite this, business loans are safest, especially if taken from banks, as they are registered financial entities with responsibility towards their customers.
Tax incentives and government grants
In Australia, small businesses can also choose to go for tax incentives and government grants. With this financing option, you can get funding for research and development, innovation, business expansion, and more.
You can look up existing grants and tax incentive programs on the Australian government website or click here https://business.gov.au/grants-and-programs?resultsNum=10.
However, you must know that government grants and tax incentive programs have an intensive application process. And you must check the eligibility criteria for each grant thoroughly before applying. Our business consultant has previously outlined certain guidelines to follow when applying for government grants in our former blog. Make sure to click here to find the blog.
Crowdfunding
One of the financing options to check out is crowdfunding, and it has gained rapid popularity in the past few years.
Crowdfunding essentially includes raising funds for your business from a large number of people online who might be interested in your product or services. Some of the benefits of crowdfunding include:
- Quick fundraising
- Gauging the market for interest in products or services
- Increase the engagement of potential customers
- Increase brand awareness
Although it offers several benefits, you must understand that crowdfunding is not a sure-shot way to raise business funds. You need to create a crowdfunding campaign which can be challenging.
Equity-based and reward-based crowdfunding are two of the common ways to use this financing option. In equity-based, you give a portion of your business to the investors who provide financing. In reward-based crowdfunding, you offer some rewards to the customers, such as offers or discounts on the product.
Pozible and Kickstarter are some of the crowdfunding platforms you can check out.
Business Credit Cards
Just like you have credit cards for personal expenses, you also have business credit cards for business expenses. Having a business credit card can help you manage nifty expenses such as making essential business purchases. Using a business credit card can provide you with benefits and rewards such as cashback, offers, and discounts.
However, you need to know a few things.
- Make sure to repay the credit card balance at the end of everything to avoid credit card debt.
- American Express offers one of the most beneficial business credit cards. However, you must ensure your current vendors and contractors accept payment through Amex. If not, you can use other payment options such as RewardPay, B2B Pay, and more.
- You must also be aware of the eligibility of business credit cards. If you haven’t traded in the market for long, it might be difficult for you to get business credit cards. Make sure to check the eligibility.
Wrapping It Up
Having adequate finances is essential to starting and running your small business. While several financing options are available, make sure you choose one that suits your current business needs.
At Keystone Executive Coaching, we discuss all these financing options with our clients to ensure they know their options and the best one for their requirements. Moreover, we also provide them with guidance on managing their finances in the long term to maintain their small business. Our business coaching Australia also focuses on other business functions such as marketing, human resources, sales, employee and customer engagement, and more.
Contact our team now to find out more about our services.
