Starting up and managing a successful small business is no easy feat in these competitive business days. It is a well known fact that keeping a small business afloat without spiralling into debt is difficult. The Australian Bureau of Statistics recently reported the “business exit rate during 2006-07 was 14.6%” which suggests small business failures are significant.
The big struggle to stay afloat in the opening years has been made even more difficult in recent times with increased costs such as interest rates and petrol prices. While labouring to establish a business within your market, not falling deeply into debt is a key objective, as Debt specialist Rory Mathews warns “Bad debts can be catastrophic no matter what the size of the business”.
Small Business Debts
Mathews continues, “With the domino effect created by just one or two bad debts, the path to bankruptcy can be a swift one for a small business.” By investing so much capital into their business, business owners are often at risk when their small business fails. Indeed, in October 2006 the ATO bankrupted 3776 taxpayers who could not afford to pay their tax bills, with Fleur Anderson from the Australian Financial Review describing these were the result of “largely small businesses”.
If you are facing unmanageable business debts, the Australian Lending Centre may be able to assist you. A well structured refinancing package is a great strategy for consolidating business debts. For more information contact us now on 1300 138 188.