7 Reasons Why Debt is Good for Your Business

Debt is often perceived negatively. Debt can be “evil”, “crippling” and an “unforgiving master”( the last one from the Google query “Debt is…”;).   It suggests a lack of sufficient cash flow and an inability to fulfil your funding requirements.  It also an indication of increased risk, as if you are unable to service your debt repayments, it could have dire consequences for your business (see American Apparel).  There is however another side to debt.  The majority of large corporations have some level of debt.  It can be a great way for individuals to earn a return on their investment.  And of course it is an integral part of the engine that drives the world economy.  For small business owners, debt can actually provide some great benefits as long as it is managed responsibly.  Some of these are discussed below:

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