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9 Ways To Juggle Small Business Finances

small business

Small businesses almost never have enough capital to expand how their owners envisioned, and often they can’t even afford basic expenses like rent. Such limited funds force entrepreneurs to make decisions each month like which bills to pay and which ones to put off until the next month. Although it can be difficult, it’s important that entrepreneurs prioritize their bills in order to keep their companies running smoothly.

Here are some typical bills you may need to pay as an entrepreneur, in order of priority:


  1. Taxes
  2. Payroll taxes, state sales taxes and income taxes should always be the first items you pay so you don’t wind up owing the government.

  3. Payroll
  4. You always want to pay the people who work for you so as to keep them working for you. Additionally, there are severe legal consequences of not meeting payroll deadlines.

  5. Overdue bills
  6. Bills that are overdue by several months can harm your company’s credit score, making it more difficult for you to obtain credit in the future. They can also rack up interest swiftly. If you can’t afford the full amount, try to work out a payment plan with your creditors.

  7. Rent and utilities
  8. A place of business, electricity and Internet are essential for running a company. Don’t risk having your utilities turned off or getting evicted from your workspace. If you can’t afford your rent, consider downsizing.

  9. Top vendors
  10. If you have suppliers you rely on, keep the relationship in good standing by making them a priority. After you establish a good payment history, you may be able to work out payment plans when you run into financial trouble.

  11. Secured debts
  12. If your business has a debt tied to collateral such as a piece of equipment, pay that debt on time to ensure you don’t lose vital gear and machinery.

  13. Insurance
  14. Liability insurance protects your company in case of an accident. If your company can’t afford the premium, try downsizing your coverage.

  15. Other bills
  16. All other bills can take the back seat if you don’t have the funds to pay them. Lapsing credit card bills, for example, won’t have major immediate effects like repossession or losing power. If you can afford to pay only some of the remaining bills, pay down the ones with the highest interest rates to save money in the long run.

  17. Secondary business expenses
  18. Costs like subscriptions, advertisements and office upgrades should be cut when you can’t afford bills, as they are not necessary for your business.

When you meet financial problems, it’s important to open your lines of communication. While expenses like taxes and payroll leave no room for compromise or lateness, other bills and their deadlines may be open for negotiation. Think ahead and contact creditors at the first sign of trouble.

Katherine Pilnick is a personal finance writer and blogger for, a financial help website.

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