Unmanageable debt can bring a small business to its knees.   All efforts should be made to operate your business from cash flow without the need to incur any debts; however, when it is absolutely necessary to borrow money it should be done wisely.

If you dream of starting your own business, it is better to wait until you have put enough start-up money aside to open your doors without the use of borrowed money.   Once started, you should do everything you can to avoid having to borrow money for your business.   Invest your time and hard work, do not buy anything that the business cannot pay for, and do not make the classic mistake of expanding faster than the business can handle.

Borrowing money to run your business should be the exception and not the rule.   Your chances of success will increase if you do not borrow at all; however, if you must borrow, you should follow some basic guidelines.   You should confine any borrowing to short term loans that you know can be repaid from the business.   You should avoid trying to sustain your business by depleting your savings, taking cash advances on your credit cards, or encumbering your home with mortgages or home equity loans.   If your business cannot sustain itself; or, when necessary, carry needed short term debt, then you should cut back on your spending or think about getting into another line of work.

Debt spells nothing but trouble for any small business owner.   There is nothing more frustrating to the owner of a business then to find that the money being generated from all of the hard work and effort is only serving to line the pockets of the creditors of the business instead of being available to the owner of the business.   Debt reduces your options and makes operating your business much more difficult because you now have to answer to the demands of your creditors rather than being able to run your business as you see fit.

If you are fortunate enough to be able to operate your business without borrowing any money, you will have the ability to pursue your own vision and not that of your creditors.