Your aggressive growth strategy may be what is keeping lenders at bay.
If you're struggling to borrow money, it might be a sign that you're growing too fast.
Sure, there are a handful of reasons why you get turned down for a business loan--no business credit and poor personal credit, heightened lending standards post-recession, low collateral values, and weak financials, just to name a few. But, for entrepreneurs that have strong credit files, worthy collateral and a profitable business, you may be shocked to find that it's your speedy growth that leads to rejection.Slow Down, Grow Smart
In order to grow and expand, many small businesses take on increasing amounts of debt in order to finance the next stages of their business. But if you are building up debt year after year, there is a good chance that you are growing too quickly and putting unnecessary strains on your business (and yourself) by sprinting to the finish line.
It's important for entrepreneurs to hit the pause button every once in a while and do a little introspective analysis of their growth plan. Operating without one is dangerous. Letting yourself swerve off course is just as bad.
We see this situation happen in our office when a business owner wants to branch out and continue to expand before even letting the paint dry on a new location or getting an order for one new product. We hear the exasperation and anger in their voices when they tell us banks won't give them more money to grow. Our advice? Consolidate existing debt, revisit your growth plan and hit the pause button for a moment.
Borrowing too much at the onset of your business, or continuing to borrow often in order to catapult a business into the next phase again and again can only last for so long. Eventually, it becomes impossible to get an affordable loan with good terms because banks will be wary of your growth strategy and your ability to pay back the loan. Despite your growth, lenders won't see opportunity--only risk.Go to Source