As a small business owner, you know it is a good idea to hire a professional accountant and to always have a working capital fund in case of emergency. When it comes time to obtain funding, you may wonder if a family business loan is a good idea.
There are not many options for fast business funding for an entrepreneur. Consequently, you might believe that a family business loan is your only choice. Before making a decision, it is important to weigh the various pros and cons.
What Are the Advantages and Disadvantages of a Family Business Loan?
Using family members to overcome your lack of capital is not a decision to be made lightly.
On one hand, you can borrow from someone you know and trust. Also, since the agreement may be less formal, you won’t have to worry about a stellar credit history or whether you possess enough collateral to back the fast business loan.
Alternatively, the downsides of a family business loan can include feeling awkward about this new financial relationship and family discord if loan obligations are not met. Additionally, the family member may feel as if their financial generosity entitles them to make decisions about your business.
Are There Alternatives to a Family Business Loan?
Instead of risking bad blood at every future family gathering, it might be wise to find other ways to grow and rescue your business. To save your business and promote family harmony, the best idea is a cash advance company, like Financing Solutions (www.fundmypayroll.com).
They can help you with the immediate business funding you need to make payroll, purchase equipment and other daily operating expenses. Most importantly, Financing Solutions offers a fast and easy application process, a quick decision and a convenient repayment schedule.
If you have 15 minutes, you can apply for instant business financing. In most cases, you will receive an answer on your application in a few hours, with the money in your account in less than two days.
How to Avoid Conflict in a Small or Family Business
It is difficult to run a small business and oftentimes you will take all the help you can get. This may include asking friends, family member or in-laws to help out, both with labor and finances. A situation like this can get pretty messy, but there are tools and tactics to help make things easier.
One thing you can do is to hire a mediator for any family drama or conflicts. This may help to keep family issues and business matters separate.
You should also make sure everyone’s role is clearly defined. If family members are on the payroll, they must pull their own weight or be let go like any other employee. It is also a good idea for any financial arrangements to be put in writing and notarized.
Another way to avoid problems in business is to contact Financing Solutions. When seeking a good idea for quick business funding, they can provide the answers you need.