Before applying for a loan, be clear about the problem it solves. The answer decides the kind of loan that fits.
When you need working capital
If you are turning away orders because you cannot buy enough stock or cover costs until customers pay, you need working capital. It is usually shorter-term and repaid from sales.
When you need equipment
If a machine, vehicle or tool would let you produce more or cut costs, an equipment loan spread over a longer period may fit better.
Line repayments up with earnings
Whatever you borrow for, the repayment should come from what the money earns. That keeps the loan working for the business rather than against it.
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