As a business owner you are often facing a number of risks, opportunities and challenges. One way to improve business growth may be through the use of a business credit card. While much can be said about the merits and disadvantages of using a credit card, the reality is that by managing it well and making sure that you repay it on time, your business can gain quite a lot.
How to make the most of your business credit card:
Business credit cards allow you to manage your business’ cash flow simply.
Business credit cards affect business credit (and sometimes personal credit too).
Business credit card limits tend to be higher than personal credit. As a business owner, you need to be disciplined and only use what you can afford to repay. Avoid exceeding your credit limit.
It may be ideal for entrepreneurs who want to establish business credit for the business. The key is to make sure that you manage payments well and maintain a good credit rating for the business. It’s important to manage your business credit cards carefully by paying on time and not using it for cash advances.
Inc.com advises:
“To succeed as a company, it is imperative to make sure your business is as reputable to creditors as it is to customers and vendors.”
Define how much credit you actually need by analysing your business plan and projecting your monthly cash flow. Only take on debt if it increases revenue.
Make sure that you avoid co-mingling. Don’t mix personal and business expenses.
Using a business credit card can make it easier to track your business expenditure and to afford to pay for large equipment payments.
Read your business credit card terms and conditions thoroughly and make sure you read the fine print.