How do profit increases your ability of borrowing money?

[Muhammadawais]

You can increase the profit per sale by constantly looking for ways to increase the price or reduce the cost of the product or service without lowering the standard. ... Every dollar you spend reduces, if your sales and revenue remain constant, also goes straight down as a net profit.

 

[Kennysplash]

I am not a fan of borrowing money, it is the last option that I never resort too. There is a saying that the borrower is a slave to the lender. If you are addicted to borrowing money you lose your self respect to a considerable degree.

 

[Ibrahim1]

As for me you are right and moreover Banks don't just give money out anyhow but ask for financial records before le ding big money to the company and also ask for collateral because some company's might run down and never used the money wisely but lavish the money anyhow or spend it for there own personal self using the name of the company to stand

 

[Kehinde]

Increased tax revenues. Higher company profit will lead to a rise in corporation tax revenues. ...
Research and development Higher company profit enables firms to invest more in research and development. ...
Higher dividends for shareholders. ...
Incentive effects. ...
Signal effect. ...
Savings.

 

[Kelly5]

If increase in my businesses profit increases my chance of borrowing money from any banking institution, then I not going to be interested in getting any loan from them. After all I don't like to hear the word borrowing or lending in the first place

 

[Diamond07]

Have you ever crossed this thing into your mind? Seems very ironic to hear right, but it is possible. Yes having the profit increases your ability to borrow money from possible investors. Debt lending allows a corporation to repay the money loaned with interest to the borrower. Debt funding for a small corporation usually involves a bank's borrowing of capital. Profitability of a business plays a major role in lending a bank money to the company.

Besides interest, the loan value and collateral of a business owner are deciding factors in the decisions on the loan. A business which cannot make profit is generally regarded as a risk of a lender's default.

What are your thoughts about this, is it still profitable ? Please share your thoughts.

You're right, if you are the lender, you have to ensure that the person borrowing will be able to pay back. The organization borrowing must be making large profits as return so as to be able to pay back the loan

 

[Emma Aneni]

Skills and educational qualifications are very imperative in business environment they help one another before educational qualification can do anything skills need to be acquired he is just like the bedrock laid as a foundation and educational qualification is a structure built on the foundation.

 

[Ralphjoe]

You are quite right that the the profitability of a business increases the ability of business to borrow money or capital for any funds that it want to get for any project that it want to execute. This is so true because it's among the documents that banks request for before they grants loans to companies.

 

[Ridorz]

Yes, the amount of profits can make a person capable of borrow money. Most of the bank are usually seeking a daily profits of a business to evaluate the business in which to know the amount of the business owner can borrow from thm before they can release a loan for the person.

 

[Ebuka Stephen]

Well I think this is good , the business is booming and wants more loan to be able to expand the business,but for him to get it he must shoe records of the profits and losses of the business to show her is capable of paying the money with interest on it.

 

[Atiqurrehman]

Profit equals a company's revenue minus expenses. Making a profit is important for a small business because profit has an effect on whether a company can get financial support from a bank, attract investors with its funds and grow their business. Companies can't stay in business without turning a profit.

 

[Adesuwa]

I think is a good way to go . The business make profit as it is, now want to borrow more to expand and grow even more, which would mean or profit. Any bank will think twice to borrow such business.

 

[Asma]

yes profit is major factor for borrowing money because its define your business and income progress to the person or bank from.which your borrow money, Banks also consider this factor before approval of loans.

 

[Waseem74]

When looking for money, you must consider your company's debt-to-equity ratio. ... should increase your ownership capital (equity investment) for additional funds. ... The ability (or capacity) to repay the funds you receive from a lender must be ... that profit can cover the payment of additional debt, it is likely that the loan will

 

[Patrik]

Because in the bank, you have a proof that there is no reason for you to steal their money, not a poor guy that will take loan and has a very small chance to give back the money that he took in that loan

 

[Ayoknl]

You can increase the ability of borrowing money either from financial institution or individuals by first of all being a trustworthy person. Always have a history of repaying your loan or borrowed money on the stipulated time and date. No financial institution/individual would loan money to an unworthy person

 

[MarieArie]

You ought to grasp the principles of profit margins and profit generators in order to be more efficient. In order to maximize your revenues, you will then build strategies, including ways to increase your sales income, your earnings on individual goods and services, and lower costs.
To help measure your benefit target and minimum revenue criteria, you can use the instruments, diagrams and tables in this guide.

 

[Neeta313]

It is possible, profit can increase your ability to borrow money because, if you started small and you start making reasonable profit, obviously the profit may not be enough to expand on your business, so you may need to take a loan from the bank or even borrow from someone else and the fact that you are confident that your business is making profit, you can take a loan and be sure of paying back.

 

[Eodine]

The more profit you make, the more money you make, the more money money lenders can borrow you. Credit facilities run a background check on many things before approving a loan, finance been important, so if you have money in your account, you have a chance to get a loan.

 

[eenya001]

Making more profit from a business venture actually increase your confidence in wanting to borrow money, because you would have the capacity and capabilities to take a higher loan amount for the sole purpose of trying to expand your business.