Hi everyone, about a year ago I started my first business and recently went full time in March.
(I live with my parents and have no rent thankfully)
Ok so I’m 22 years old and have a service based business doing 10-15k on average per month since March and just recently hit $105,000 in revenue since then. My problem is that due to start up costs and all materials and equipment I only have about 10-15% of that in the account. I just recently started Google ads which have thankfully paid themselves off the last two months keeping it zeroed out. I just signed up for a radio ad it try for one month to see if anything happens, fingers crossed.
I may not have the best formatting or explanation of my situation but it’s vague due to trying to get straight to it. I have been contemplating taking out a small loan of 15-20k to have as a security and using the loan to make the monthly payments on itself.
I would take about 10% into the checking account for expenses, 20% for ad spend, and the rest would sit in a separate account just making the payments on itself.
I just need any helpful advice from anyone that has had experience with business loans
Should I take out a business loan?
byu/Fluffy-Train-6421 inEntrepreneur
Posted by Fluffy-Train-6421
3 Comments
If you can live without the loan then do that. Right know rates are still high and you want them to come down a bit. Plus sounds like you are doing pretty good. You want to think about how to optimize your income to speeding. I have a service based business as well. I never took any lines of credit. Look in to local advertising and facebook ads locally in your area only. They pay off better, Depend on what service you are offering. As an advice stay away from loans unless you need to expand your business. Hopefully that will help. Good luck.
Why not just do a loan for $8,000? Focus on the Google ad. Can you optimize it further? Having it break even is a significant accomplishment. I bet there’s tons of room to maximize the landing page and headlines.
Radio requires many, many follow-up runnings. You can’t just run an ad for a couple of days like you would a Google ad. It takes time for the audience to warm up to your message and remember your number/site.
The only time a loan makes sense for business is if it will help your business make more revenue/profit