socialmedian: Ducking Credit Card and Line of Credit Abuse

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Ducking Credit Card and Line of Credit Abuse

Apr 17, 2009

Summary

Many businesses start out by relying on credit cards and a healthy line of credit from home equity. These businesses might use credit when it needs to purchase something for the business or to keep the business from falling apart when customers took their sweet time paying their bills or the business allows payment plans get out of control.

Comments (7)

Asearvern,

Apr 17, 2009

One of the great evils of society, both personal and business is the credit card.

Rden,

Apr 17, 2009

When you have built a successful business and you have a pretty good idea what type of income to expect, it's easy to continue the same budget, even for quite awhile after a downturn starts. Easy to keep spending, when you really need to cut back.

Asearvern,

Apr 17, 2009

@rden Yup! Been there; done that...just kept spending when I needed to stop.

Mmentors,

Apr 17, 2009

Offering credit to customers seems like a great way to 'bring them in', but you need to have a whole department ready to collect when they 'forget' or have some trouble paying. Just depends on what you want to do with your time.

Sydney43,

Apr 18, 2009

You are 100% correct that a business must stay on top of its credit in order to stay afloat! In a recent conversation with my tax accountant I discovered that even he is in a crunch due to clients not paying. They all blame it on the economy, but that's not fair to the professional who has done the work. From the business owner's perspective, it's wise to not complete large assignments without at least partial payment. Credit is truly a double-edged sword which can really hurt is we're not careful.