A Comprehensive Guide to Business Debt Management


Jeffrey Bumbales


Table of Contents


Across all industries, verticals, and markets, debt is unavoidable. The secret to business success isn’t knowing how to avoid debt—it’s knowing how to manage business debt.

What Is Business Debt Management?

In our view, educating yourself on debt management is an essential skill for all business owners, whether they’re running large or small businesses. Business debt management comes down to understanding the challenges of the process and how to control those challenges, while still maintaining business growth.

Some debt will be unavoidable as you invest resources to grow your business, but this can escalate to unmanageable levels quicker than you might think. Arm yourself with knowledge and keep these issues in mind.


What’s the First Step in Managing Business Debt?

Knowing what options you have. Check out the different financing options available and find ones that fit your cash flow

Get Started


1. Establish a Debt Schedule

Your first step towards managing debt is to take stock of your existing debts with a debt schedule. This document lists out your company’s debts in a structured way, usually including the following details:

  • Open loans, leases, and contracts
  • Names of creditors
  • Current debt balance vs. original amount borrowed
  • Interest rates
  • Monthly payments

And so on. Get everything on paper before moving forward. This document can be easily created in your accounting software and offers an important reference when considering which loans to repay first and how to structure your other business debt management goals.


2. Be Mindful of Growth Opportunities

Every small business owner should be aware of opportunities that support growth—but be mindful of where you’re putting your dollars. Poorly thought-out investments can spell doom for your long-term financial situation, even more so when you aren’t prepared with a solid debt management plan.

Strike a balance between what you’re investing in day-to-day operations and your saving strategy. Don’t avoid opportunities, but be aware of how they’ll affect your liquidity. Look for ways to reduce overhead costs and keep your options open for when the right opportunity comes along.


3. Leverage Loans to Your Advantage

We’ve seen many business owners overlook a common way to reduce debt: loans.

Yes, in a move that may seem to run contrary to common logic, small business loans and establishing a strong line of credit are integral to small business debt management. Credit adds flexibility outside of typical cash flow channels and opens up opportunities for expansion, acquiring favorable interest rates, and more.

Companies can use strategic business loans to invest in opportunities or pay down existing debts, a financing strategy commonly referred to as acquiring “good debt.” (In other words, incurring debt that provides long-term value rather than “bad” debts that reduce value.)

Of course, when leveraging loans like this, make sure that you don’t dig yourself into an even deeper hole. The right financing partner can help you boost liquidity with payment terms that work for your business.


4. Consolidate Existing Loans to Manage Business Debt

Business Debt Management

You may notice a recurring theme in our advice: planning ahead and making the right choices from the outset will save you money. But what happens when you’re already in debt? If you’re already struggling to tread water, an easy step is to consider refinancing your existing loans.

Depending on your situation, you may qualify for lower rates than you initially did, or at the very least, you can consolidate your existing loan portfolio into a single payment with a more predictable interest rate.

This type of debt refinancing is a common tactic when dealing with business credit card debt, and it’s an effective way to cut costs in the long term.


Get Proactive About Your Debt Management

At Credibly, we see your business as much more than just a profit and loss sheet—we look at your potential. Don’t settle for loan terms and payment schedules that don’t fit your cash flow, contact us today.



Manage Business Debt Like a Pro

Lower monthly payments, free up assets, unlock receivables, and give your business room to grow.

Talk to a loan expert and learn about financing options that are ideally suited for your business.

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