How to Reopen Your Business in the New Normal without Debts?

While the global pandemic has claimed many lives all around the world, it has also forced many businesses to shut their doors closed. If you are one of many such businesses, then surely you have been through hell and back. While you closed your business, that has surely incurred financial losses and perhaps debts too. Now, after months, when you are planning to open your business, you need to get a fresh start and without any debts.

So, at Nelson, Cooper and Ortiz LLC, the best collection agency in Houston, we are here to tell you how you can do that. Take a look at the following points to know more.

Smart Debt-Free Business Reopening Ideas

1. Take Care of Your Past Debts

Even after closing your business, are you left with some funds in hand? Maybe you have got the payment and as you are not paying any wages, you have money in hand to pay off a past debt. If yes, then do it first. If you have taken material, products and services on credit, then pay them immediately.

2. Look for Government Capping and Relaxations

Since the beginning of the pandemic situation, state and federal governments have introduced various relaxations and capping for individuals as well as for struggling businesses. If you are in a tight place and need to use all the cash in hand, then look for such relaxations. That way, you can delay the government payments and pay your debts when agents are calling you for commercial debt collection.

3. Downsizing

While reopening your business, you need to go for downsizing. Right now, owing to the pandemic, you are not in a good place. So, you cannot take the burden of paying all your employees. It might be a difficult decision to make, but a necessary tip to grow your business debt-free. Only open with the essential staff.

4. Go for Settlements

If you are paying your debts to your creditors, then you can negotiate for some discount or cashback. They also need the money. Hence, you might be in luck when you are asking for these incentives. If the debt is huge and your creditor has hired a collection agency Houston, then go for settlement. Pay the debt in installments.

5. Choose Slow Growth Over Fast

Business growth tends to be slow when a debt-free model is adopted. While borrowing capital does enable you to take actions that would expand your business, it’s not sustainable. Too many businesses have gone under due to excessive borrowing, since it ends up affecting their net profit and cash flow. So, don’t chase extreme highs immediately. Stay on track and grow steadily without incurring high risks.

6. Consider Other Financial Avenues

Relatives, close colleagues, and friends might be willing to offer you zero- or low-interest loans, but this isn’t feasible either. They might help you reduce repayment pressures, but you don’t want to take advantage of the generosity of your loved ones. If you default on their loans, it’s not a financial issue; it becomes a moral one as well. 

However, if you do go down this route, draw up a contract, specify terms, repayment schedule, and conditions. Otherwise, seek the help of credit advisory, counselling firms, or professional debt management experts.

These are the ways you can reopen your business while getting rid of debts. If you are looking for debt collection or need any advice regarding the same, come to us at Nelson, Cooper and Ortiz LLC.

We are an experienced firm and equipped with collection agency tools for efficient service. Dial (800)939-7213 now for more details.

FAQs:

1. How to make business debt-free?

To make a business debt-free:

• Create a budget and prioritize debt payments
• Negotiate with creditors
• Increase revenue
• Reduce expenses
• Consider debt consolidation
• Seek professional help

2. How to revive a collapsed business?

To revive a collapsed business, you can:

• Assess and address root causes.
• Restructure finances and debt.
• Revise business strategy and operations.
• Seek new funding or investment.
• Rebuild customer trust and relationships. 

3. Can you start a business if you have debt?

Yes, you can start a business with debt, but it’s essential to:

• Manage debt effectively
• Create a solid business plan
• Ensure sufficient cash flow

Debt can be challenging, but it’s not necessarily a barrier to entrepreneurship.