4 bad effects of owing others in a business

[Augusta]

In business there's always the tendency to owe whether financial institutions or suppliers but it comes with bad effect if you don't keep to the terms of pay back. This action of not paying back can ruin your business

So how can owing heavily ruin your business

1. Owing banks can hinder you for getting any future financial aid from the banks. So if that was your only option to sustain the business it will fail.

2. Owing your suppliers might hinder them from supplying you more products on credit. So if you don't have the money to buy, your business might collapse

3. Other business owners might not want to get into business with your business if they find out that you owed without remitting. So the help you would have gotten will be hindered.

4. Your business might suffer a setback if you no longer concentrate, as you would be running around to get money to make repayment.

What's your thought?

 

[Jasz]

Bad effects of owing others in a business

1. The first and foremost bad effect of owing money to others is that there is no control over your finances. You will always be dependent on the other person for any financial help. If they want you to pay back the amount they lent, they can easily take it back from you by taking your property, or by not giving you any work at all.

2. Another bad effect of owing money to others is that you will lose your freedom and independence. When you owe someone money, it means that they have rights over your life and actions. Your employer may fire you if he doesn't like the way you behave, or if he thinks that his interests are being threatened by you. In this case, there is no choice but to obey him because if he doesn't like something about you, he can easily make your life miserable!

3. The third bad effect of owing money to others is that it makes people dependent on them and forces them into a position where they need someone's help all the time just to survive in life. This makes them weak and vulnerable as well as lacking self-confidence as they feel guilty when there is not enough money available for them.

 

[Augusta]

Yeah owing in business somewhat leaves the debtor at the mercy of the creditor because it is mostly what the creditor asked to be done that you would do for your business. You are owing as such you might really have the options or doing otherwise.

Yes business comes with buying a lot of times on credit which might help you meet the demands of the customers but you need to do the needful to maintain continous supply which is to make payments when due. if you keep on playing pranks when it comes to making payment you might find it difficult in future to get goods on credit.

So doing the needful by paying up will help the business. The truth is that a business that is devoid of products that will help make the customers to keep coming back will fail sooner than you think.

So if possible it is better to stop owing In business.

 

[Sotherefore]

Most business organisation will not want to be in this situation because this is not always a funny experience. Mostly it is an indication that your business is likely not to succeed if you keep on not being able to pay for products of raw materials you are using in your business.

It doesn't really make sense for business organisation to be in this positions. The best thing such business organisation has to do is to close down because getting financial help in most cases could hinders your business and will slow down the progressed .

Whatever the case may be , if I am the one in charge of this business organisation , instead of me to continue getting loans or product on credit, I'll try as much as possible to manage the resources that is available in the
company and use it to grow the company as much as I can .

 

[Augusta]

This is the way to go because owing an individual or a business comes with it's pressure. I'm one person that can work well when pressured so I try to keep away situations or issues that will make others or people put pressure on me.

I don't know how others do it, because I see a lot of people just believe they need to be pressured before they pay money or a loan they went cap in hand to borrow. I think this is one of the things that cause frustration for a lot of people. They can't keep up with the financial pressure.

The best bet is to work with the money you have and forget borrowing. The truth is that any kind of borrowing comes with it's issues especially if you can't pay back when you had stated it will be paid. so to be in peace avoid borrowing money recklessly and work with your budget