As the saying goes, money makes the world go round, and that couldn’t be truer for a small business. Your capital makes the difference between taking home a profit and having to skimp on groceries or falling behind on bills. Even long-established operations can find themselves experiencing a downturn of clients and dwindling cashflow. When this happens, you have to think fast and find a quick solution to protect your small business and your employees. When the cash register isn’t ringing enough in your business, here are a few options you may use to get that much-needed financial boost.
Bootstrap Your Business
Business bootstrapping is the process of fueling a company’s profit and growth with your personal finances. As an entrepreneur, you already know how much it costs out of your own pocket to get a startup off the ground. It’s not always ideal, but sometimes, dipping into your savings to replenish your company’s account is worth the temporary hit. There are other ways to bootstrap that aren’t money-related, though. They can instead help you preserve what precious funds you have left. Think about doing your own cleaning, reducing the consumption of office supplies and delaying purchases until you have more capital to spare.
Sell Your Life Insurance Policy
You may be able to sell your life insurance for a cash payout. This guide will walk you through the process, including how to find out the true value of your policy before settling on a buyer. Life insurance can be a valuable financial planning tool for entrepreneurs, especially when you’re able to settle easily for a lump sum of money. Make sure that you also consider the implications this could have on your family. Ideally, you shouldn’t sell a policy and then go perpetually without coverage. You can sell your life insurance and then buy a more affordable policy to keep your loved ones protected.
Run A Limited-Time Offer
People love sales. FOMO makes consumers hit buy on things they may have contemplated for months otherwise, and you can potentially increase sales by making things exclusive. A limited-time offer can even be made even more exclusive by creating packages and then offering 20 to 30 percent off for customers who buy within the next 48 hours. While this may sound like a lot, you actually wind up coming out with more money because you are able to price bundles higher than individual goods or services.
Ask Friends and Family for Temporary Assistance
No one really wants to reach out to their parents or friends when they’re short on money. No matter how close you are, it’s an awkward subject to broach, and you may feel guilty or even embarrassed to ask. But you can address the situation from a professional standpoint. You aren’t asking for a handout. Come prepared with a written agreement, including a standard repayment plan and even potential interest. Make sure you also have an explanation of the entrepreneurial tactics to expand your business that you plan to use their money towards. Instead of simply saying you need their cash to keep your business running, fill them in on where their donation will go and what it will help you do.
Only ask loved ones you genuinely trust; taking any money from someone you aren’t close to could lead to conflict down the line. And no matter what, make sure you both sign an agreement. Keep receipts of any transactions between you to protect yourself in the future. It may be someone you trust, but your business is at stake, so you have to play it safe.