A business loan does not only help new entrepreneur build-up funds to start a business, it also helps existing businesses for their needs. Here are some of the reasons why existing businesses would apply for a business loan:
1. Business Expansion - This applies to either physical location expansion or products or services expansion. If you feel your workforce can no longer fit your current office, then get a bigger one. And if your current business is booming and you think you can create new products or extend your services, then you can get a business loan to fund them.
2. Building Business Credit - Business credit allows your business to borrow much larger amount of loans, just like a personal credit. If you want to build up your business credit, you can get short-term small business loans to help you do so.
3. Equipment Procurement - Purchasing new equipment also qualifies for a business loan. Other lenders have a specific loan product for this, called Equipment loan.
4. Purchasing Inventory - Your business inventory is one of the most important things that you need to spend money for. Its where your supplies for your products will come from. Getting a business loan will help finance the purchase of more inventory.
5. Salary Expense - The business' workforce is very important because it runs the whole operation. Sometimes, your cash at hand is not enough to pay for the existing employees or hire new ones. In this case, getting financing help will reduce your worries.
6. New Business Opportunities - If you are an entrepreneur, its best to have multiple stream of income so you have back-up in case the others don't do well. If there is a new venture that seem very promising, then grab it right away.
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