You can run a multi-million dollar business without EVER going into debt.
Most business owners that I know have an incredibly hard time getting past the myth that small businesses must have debt whether it be constantly or at the startup. This is flat out wrong. It IS possible to cover large purchases without going into debt.
Borrowing money makes you a slave to the bank! The debt that you have increases your risk. Look at the 2008 recession. How many businesses filed for bankruptcy? You can't have these issues if you're not in debt! The businesses without debt prospered exponentially when the economy took a downturn. They purchased their competitors for pennies on the dollar. They used their money to expand because they didn't have to make payments to the bank.
If you're business if spawned from a "great idea" that you had but weren't passionate about and went out and got a loan to start up, if your business collapses, you're going to have years of payments or bankruptcy after your business failed reminding you of your once "great idea" for years to come.
Truth About Small Business Debt
You might think that you need to get a loan to start your business or to cover expenses when cash flow lacks. You don't need to! Most businesses start up with $5,000 or less. If you have a plan, you can plan for the cash flow discrepancies.
Credit cards? Do you think you need a credit card to make purchases online, travel expenses, or anything where cash is hard to use in the transaction? You don't! Use a debit card. It allows you the freedom of a credit card with using your cold hard cash without the 16% interest for not paying the bill at the end of the month.
Three Things to Avoid Debt for Large Purchases
Pay Cash - Save using a systematic approach until you can pay cash for your purchases.
Outsource - Need to print marking material? Don't buy thousands of dollars of printing equipment. Use a printing company and spend only a few hundred dollars and get the same result.
Rent Until You Can Pay For It - Renting an office space? Continue to rent it until you can purchase a building...with cash. Use the reasons you hate renting as motivation to save your hard earned cash!
Didn't Start Debt Free?
You can be! Develop a 2-5 year plan to rid your business from all debt by allocating a percentage of your business' profits to debt payoff. While you're doing that, go ahead and make a plan to pay for upcoming purchases with cash.
Once you start operating debt free, you'll never want to go back. Even when times are tough, you'll have cash to cushion the blows and open the doors to whatever opportunity comes your way.