Finance
A business needs adequate funds in place in order for it to survive and grow successfully.
Customers’ needs and expectations are always changing so a business has to be ready to meet these new challenges.
This is why businesses introduce new versions of a successful product, and why restaurants change their décor or shops change their layout. All of these changes need investment.
To increase their market share and increase sales, businesses need to grow. Finance is needed to help meet the needs of the business as it grows.
Without the proper finance, a business will be held back and will eventually struggle to survive.
Finance may be needed for several different reasons:
- developing new products
- upgrading new software
- a wage rise for existing employees
- hiring new staff
- an advertising campaign for a product
- extending existing premises
- buying a new fleet of vehicles
- opening a new branch
- buying new machinery and equipment
In some of these situations, finance will be required from the bank via:
- a Money borrowed from a bank that is paid back with interest. or a A loan on property., which must be paid back with interest
- a A sum of money given to a business by a government body which is not paid back. from the government
A business is directly affected by the amount of finance it has available. A business will be unable to hire new staff or buy new equipment if they are working within budget constraints. This could adversely affect their growth and success.
