Working capital can be a struggle. If you need to borrow, make smart choices.

1. Nothing beats solid planning
   1. Ideally, we can handle our finances organically
      1. Control growth / save where you can / plan properly
      2. Liquidate under-utilized assets
   2. Doesn’t always work out that way and we get into situations where we need some capital
   3. When this happens, sometime we need to turn to debt
2. Common solutions to working capital loans (from good to bad)
   1. Traditional bank loans and lines of credit
   2. Credit cards
   3. Invoice factoring
   4. Merchant loans
3. Use debt wisely
   1. Try to go with the best route first
   2. Create a solid plan for your debt
      1. How much / how long / how to pay / don’t get trapped
      2. Best way – figure a percentage of future income to pay the debt and take that percentage off of every payment – even if that means making payments several times a month
   3. Specific concerns based on lending type
      1. LOC / Banks
         1. Not paying the loan back within the year
      2. Factoring
         1. Making up for the lost future revenue
      3. Merchant loans
         1. Keeping cash flow going when money comes out of the account each day and giving up the % of revenues
   4. If you must, create the plan and stick to it.