1 / 8

What Are the Pros and Cons of Debt-Free Companies

There are businesses the world over who aspire to be debt-free. Itu2019s that ideal, that dream of no money worries, which drives many business owners. But is being debt-free really all itu2019s cracked up to be? Whilst it may be the position so many strive for, in reality itu2019s not always the best option.

Leading1
Download Presentation

What Are the Pros and Cons of Debt-Free Companies

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. LEADING CORPORATE RECOVERY WHAT ARE THE PROS AND CONS OF DEBT-FREE COMPANIES?

  2. CORPORATE WHAT DOES BEING DEBT-FREE MEAN? RECOVERY LEADING There are few businesses that are truly debt-free. But what does debt-free actually mean? Basically, the company does not owe money to any supplier, stakeholder or HMRC. So, the company doesn’t have any loans, any hire purchase or contract agreements, does not owe any money to HMRC in terms of VAT or corporation tax; it has no debts at all.

  3. CORPORATE RECOVERY LEADING IS IT GOOD TO BE DEBT-FREE? Whilst the ideal of being debt-free is tempting, it’s not always the best option for companies. Indeed, carrying a small amount of debt can actually work in the company’s favour. However, it’s important to note that having a low level of debt is different to cash flow problems.

  4. CORPORATE RECOVERY LEADING WHEN IS DEBT A GOOD IDEA? Presentations are communication tools that can be used as demonstrations, lectures, speeches, reports, and more. Most of the time, they’re presented before an audience. It serves a variety of purposes, making them powerful tools for convincing and teaching.

  5. CORPORATE DEBT IS CHEAPER THAN EQUITY RECOVERY LEADING Using a company’s equity for growth comes with its own inherent risks. For example, if you’ve used equity to purchase new equipment, should an unexpected bill need to be paid, i.e. for a repair; it can leave you unable to pay the debt. Sometimes borrowing from a bank or investors can be a less risky option and ensure that sufficient equity still remains in the company should the unexpected occur.

  6. A FASTER RATE OF GROWTH CORPORATE RECOVERY Any business owner wants to see their company grow, but to do that, funds are required for a number of activities, such as investing in new equipment, hiring new employees and promoting the company. Using the company’s equity, or cash flow, to invest in growth will be a slow process. Sourcing funds from a lender, such as a bank, ensures there is an injection of cash into the company. It can also boost cash flow, increase profitability and grow the company at a faster rate. LEADING

  7. CORPORATE RECOVERY LEADING REDUCES CASH FLOW PROBLEMS Every company at some point will experience cash flow problems, be it through late payments, unexpected payments or investing in equipment. It can be hard to put aside funds to invest in growth when the money coming in is either the same or even slightly less than the money going out.

  8. MAILING ADDRESS Norwich NR2 1SN, United Kingdom REACH OUT PHONE NUMBER +44 800 246 1845 WEBSITE www.leading.uk.com

More Related