Working capital mismanagement is one of the main causes why a small and medium business fails. This is also one of the main causes of industrial sickness. Working Capital is considered lifeblood of any business. Understanding the key data affecting working capital, how impacts the business, how it can be better managed, what are the sources of working capital, cost of working capital all are very important aspects of the … Continue reading All You Need to Know About the Working Capital and Business Success
Borrowing in foreign currency from an external source is a restricted activity governed by RBI. For many years now I have met many entrepreneurs asking me to help cheaper money from a foreign source. Most of the entrepreneurs were not aware of ECB guidelines and therefore most were cheated by financial intermediaries. Huge advances were given by the entrepreneurs to these intermediaries in the hope … Continue reading What You Need to Know about ECB for NPAs and Start-Ups?
Cash is King but it also kills. One of the companies hit the market with an IPO. Their Merchant banker advised them to raise more money than required. The issue was subscribed. Excess money they invested in unrelated business. That business could not succeed. The return on share capital could not match the market expectations. The share price reached below par. Since the share price was … Continue reading How Can Excess Cash Kill Your Business?
Mr. X, who was once a very dynamic entrepreneur engaged in the pharmaceutical business, is now under depression for many years. Family expenses and cost of two daughters’ education was borne by other close family members. His wife was doing some domestic work until both daughters completed their studies. Marriage of both the daughters was solemnized with the help of close family members. This is … Continue reading Is Your Business Suffering from Financial Cancer?
“Don’t spend Capital competing with people who are spending Profits.” Moffat Machingura The source of money you invest is very important. Do you do your business with own money or borrowed money? Well, when you started the business, whatever source the money came from was welcome. But this has an impact on your business. The capital structure simply means the sources of money a company … Continue reading You Need to Know How Capital Structure Affect Your Profit
I have seen the happiness on the faces of many entrepreneurs when I placed loan sanction letter in their hand. But loan rejection is not a happy state. Availing of loan is most business’s need for growth, especially for SMEs. There is a limit up to which promoters can invest own capital in the business. Beyond a point, they need the support of external sources … Continue reading 12 Important Reasons Your Business Loan Gets Rejected
REPO rate reduction of 0.25% is making the Indian investors excited. Investors believe this will trigger higher off-take of loans, higher economic activities. In reality, cheap money only can’t trigger more demand or higher capacity built up. There are several other factors. However, in this post, we will know about the RBI’s interest rate management. RBI manages liquidity in the market and inflation with REPO … Continue reading The Impact of REPO Rate on Your Pocket and Business
Once upon a time Capital used to be the scarcest available source of the business. Now the talent has taken over the top slot and capital has become abundant. But as it comes with multiple choices, which source and which type of capital is relevant for the business is another challenge. All forms of money are not equal. “Money is always eager and ready to work for anyone … Continue reading 26 Sources of Capital – All You Need to Know
“We were not taught financial literacy in school. It takes a lot of work and time to change your thinking and to become financially literate.” Robert Kiyosaki M/S ABC Enterprise is facing a liquidity crisis. The bank has sanctioned them working capital loan. In an emergency, they used the borrowed money by way of working capital loan for buying land and machinery. Since the money required … Continue reading All Money Is Not Equal & Entrepreneurs Need to Know This
NPA figure in the banking and NBFC industry is exorbitant. Banks are suffering but what about the borrowers who have suffered business loss. They are facing recovery agents, social abstinence, legal battles, the stress of managing family expectations and responsibility of turning around the business. The situation is dire. People suffering from financial distress are all around us. Financial distress is not a new thing. … Continue reading 8 Things You Need to Know to Deal With Financial Distress
“Rather go to bed without dinner than to rise in debt.” Benjamin Franklin Are you living in debt? Here is a post which explores a possibility to live without debt. Debt has become a part of our life. For anything and everything in life, the loan is available. If not formal borrowing, your credit card will always keep you in debt. Having a loan means buying … Continue reading A Glimpse of a Debt Free Life You Want to Live
Mr. R who was a small entrepreneur lived in a posh suburb of Mumbai. He was always cash-starved like many other small entrepreneurs. He enjoyed the bank limit for his working capital needs. His appetite for growth was far more than the bank’s lending parameters. However, since the last couple of years, his cash crunch problem was eased with the accessibility of many non-banking lenders … Continue reading Easy Availability of Loans Can Ruin Your Life