Monitoring and understanding the numbers is the only way to keep track of your company's health.  Your ability to interpret the numbers will enable you to recognize opportunities!  What should you know?  Understanding finances isn't just for accountants.  Every business owner should be familiar with the basic concepts of commercial finance.  Numbers are the basics of business but many companies have failed because owners/managers disregard basic business indicators.  At the very least, you should be able to read and interpret  balance sheets, profit and loss statements, sales to profit ratios, backlog, depreciation, accounts receivable, debt financing and asset-productivity ratios.  

Business owners and entrepreneurs can use financial ratios to truly understand how their business or future venture operates from a financial perspective. You'll be able to gain valuable insights and knowledge about how to improve most any business and its profitability if you develop the skill of financial statement analysis.  

Due to the nature of double-entry accrual accounting, retained earnings do not represent surplus cash available to a company.  Rather, they represent how the company has managed its profits (i.e. whether it has distributed them as dividends or reinvested them in the business).  When reinvested, those retained earnings are reflected as increases to assets (which could include cash) or reductions to liabilities on the balance sheet. - Wikipedia

"That's just the money -- the profits -- that investors have reinvested in the business." - Stephen L Nelson, MBA, CPA, MS in Taxation

A sinking fund is a fund established by an economic entity by setting aside revenue over a period of time to fund a future capital expense, or repayment of a long-term debt.  Borrowing money by issuing a bond is referred to as floating a bond.  Sinking is its opposite, repaying debt or acquiring capital assets without debt. - Wikipedia

Under the right circumstances, this option will help you to avoid the up front cost of carrying inventory.  With your good credit and a smart strategic plan, your supplier may provide you with the products you need - on consignment.  

I first came to understand the true value of 'Supplier Financing' when listening to a 'SCORE Mentor' decades ago.  He had built his chain of automotive 'tire stores' throughout Southern California by opening each store himself with a 'huge tire sale' at the grand opening of each new store.  The part of his story that I remember so clearly is that he timed and priced everthing just right so that he didn't have to pay 'up front' for the big truck load of new tires until after the sale!  He often sold the whole semi-trailer full of brand new tires in one weekend and then he'd do it again through the week.  He avoided paying tens of thousands of dollars 'up front' because he didn't have to pay for the tires when he ordered them and had nearly 30 days to pay - after they were delivered!

I could share lots of such examples - but you get the point.  Try it.  It can't hurt to ask.

Sometimes a business can scale up more quickly if it has access to a little more cash.

LoanBuilder by PayPal for example, offers business loans between $5,000 to $500,000 and terms up to 12 months. Instead of interest, your business will pay a fixed fee of 6.49% to 19.31%. This translates to an APR of 44.57% to 131.75% for a $100,000 loan with LoanBuilder's minimum term of 13 weeks. Such a loan is a debt that will like any other debt have an affect on your overall ability to personally borrow additional funds. 

Factoring provides an alternative.  Companies of any size - from small home-based and startup operations to large corporations can obtain working capital quickly and do so without incurring a penny of debt. Factoring is a means of financing which is misunderstood by some business owners, unknown to many, and yet often available to those who cannot obtain a bank loan.

"Factoring is not a loan with interest due, but the sale of an asset for which a discount is paid. By definition, factoring is the purchase of accounts receivable at a discount. That is, a factor is a person or business that pays immediate cash (somewhat less than the invoices' face value) for business receivables." - Jeff Callender, Author of 'Unlocking the Cash in Your Company - How to Get Unlimited Funds Without a Loan.' 

Most small business owners are the co-signers of their business debt which means they are personally liable for their business lease contracts, business loans and any other financial obligations of their business.  The typical 'Owner-Reliant Business' not only depends on it's owner to work in the business but it also depends on the owner's ability to pledge his or her personal assets as collateral for the business' lines of credit.  Over the long haul - this is crazy! 

A true 'Owner-Independent Business' does not need the owner to pledge personal assets as collateral any more than it needs the owner to work in the business.  Your long-term strategy in building your own 'Owner-Independent Business' should include building business credit - credit that you're not personally liable for.  To do so may require that your company adopt a structure that makes it a seperate legal and taxable entity from you but that's not enough.  You'll need to methodically build a credit track record for your business.  It'll take some time but it's easy to do if you change the way you think about credit and debt.  

This is a proven path to financial freedom.  While your business builds credit worthiness, personal debt elimination should be a top priority for controlling your financial future. That's why we recommend, promote and use the Debt Shredder® which is a cloud based debt elimination system that's integrated with over 13,000 banks, credit unions, lenders, credit card and financial service-based companies throughout the United States. 

As a general rule, rapidly paying off debt increases your net spendable income.  Using debt for leverage to purchase a large income producing asset that will appreciate in value, can be a good thing.  Wise business use of 'personal credit' is using debt (credit) only to acquire assets that immediately start producing 'positive net cashflow' (personal income) for you.  

PayPal and Intuit are among the first non-bank, fintech companies to be approved for the Small Business Administration's emergency lending program. In addition, PayPal, Intuit, and Square Capital can expedite the SBA approval process, as well as shorten the time it will take for small businesses to receive the loans.

They look at several factors to determine your eligibility for a business loan.  This includes, but is not limited to, your business history within QuickBooks, transactions within your business bank accounts, your personal and business credit history, and current liabilities.  In general, they look for a FICO of 620 or higher, and at least $50,000 in revenue in the past year. Applicants shouldn’t have any bankruptcies (personal or business) in the last two years.  Since every business is unique, they can’t guarantee that all applicants meeting their criteria will be eligible for their business loans.  Each application is considered individually and decisions are based on their own published guidelines.

The lender for LoanBuilder Loan, PayPal Business Loan and SBA Paycheck Protection Program Loan brought to you by PayPal is WebBank, Member, FDIC.  LoanBuilder, a PayPal service, is a great financing option for small businesses that need quick access to funding.  Requirements are reasonable and the business need only be in operation for at least 9 months with $42K in annual income.