The idea of having more loans than your revenue sounds scary, and there is no doubt that it can be an overwhelming place to be. But what do we mean by saying ‘loans exceed revenue’? That means the monthly repayment of loans is more than the monthly income your business makes.

When you find yourself in such a situation, the best thing you want is get out of it as soon as possible. One of the ways you can achieve that is by contacting an accountant. He or she will come up with strategies that will help get out of that situation.

Some of the strategies include:

(1) A strategy to reduce costs

An accountant can analyze all your operating expenses and figure out which ones are high. Saving some dollars by evaluating your operating costs will directly translate to adding the amount to your monthly repayment loans.

Your accountant will implement an effective cost reduction strategy based on benchmarking intelligence. The accountant should also be able to reduce overheads and wastes, and improve productivity in your organization. If you can save on labor costs and wages, you will increase your revenue, hence repay loan efficiently.

(2) Cash flow management

Many businesses fail because of debts because they can’t pay suppliers or staff. Only certified accountants know that revenue and costs tend to fluctuate. They will forecast your cash flow and come up with ways to organize a spending plan and cash reserves to ensure that there is always some funds available in the bank, that you can use to repay your loans on time. That will also help you to develop a good relationship with your staff and suppliers.

(3) An accountant will help you negotiate better terms

An accountant can help you negotiate better terms. He or she will on your behalf, ask for lower interest rates and smaller minimum payments. The accountant can also negotiate for an extended payment plan. Creditors don’t want your business to fail, that’s why they will accept these terms. After all, receiving money is always better than no money at all.

(4) Consolidate your debt

Debt consolidation is one of the options you can choose to get rid of your business loans. What happens, you take out one big loan to pay off all your loans. Then you will only have one loan to repay. The main goal of debt consolidation is to get a loan that has better terms than all your other loans. An accountant will help you to consolidate your debt because he or she has in-depth knowledge about debt consolidation.

Author Bio:

Hi, I am Nikesh Mehta owner and writer of this site.

I’m an analytics professional and also love writing on finance and related industry. I’ve done online course in Financial Markets and Investment Strategy from Indian School of Business.

I can be reached at nikeshmehta@allonmoney.com. You may also visit my LinkedIn profile.