Is it ever smart to take a loan or use a credit card to fund inventory or fees?
Borrow only if the payoff beats the interest—start with low-rate loans and treat cards as short-term floats you can clear fast.
Managing cash flow gaps often involves evaluating different financing options, such as business loans or credit lines. While debt can provide capital for inventory growth, it also carries financial risk. Business owners may want to carefully consider their projected ROI and repayment capacity. Consulting a financial advisor can help determine if a specific credit product is appropriate for your business's risk profile.
Safer options first
SBA-backed microloans (often 8–13%) are designed for inventory and fees and usually beat high-interest cards. Calculate total cost (principal + interest) and confirm the event or order profit covers it.
Cards as a short-term float
Use business credit cards only when you can pay the balance immediately—intro 0% offers or low rates help, but only if you clear the debt before interest hits. If the numbers don’t work on paper, skip the debt and look for preorders or savings instead.
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