Other Methods of Raising Finances

Ways of raising finances may not be limited to the ways mentioned above. There are many financial instruments (ways of raising finance), to run a business, in fact, the most important thing is your ability to negotiate for these finances. If you have a strong negotiating power, you might get cheaper funds, sometimes free of interest, but most times such loan may be converted into shares for the lenders.

Whatever form of finance is negotiated, there is always a cost and often a repayment to be made. The most profitable, cost-effective and satisfying method is the self-finance growth through performance, (try to grow along as the business progresses). In the whole, whatever form of decision you take whether for big organisation or small investment of your own, if you think that the risk is worth taken, you can go ahead. However, the end is what matter most, that is, there should be success or growth of the business.

CONCLUSION

The above discussions show that finance is the basis of any business and it needs to be sustained for one to remain in business. Therefore, it is important that businesses should ensure appropriate means of financing these businesses such that growth will be sustained. The need for virile sources of finance is that, it is the lifeline of any business and the ultimate of all business investors.

SUMMARY

This unit highlighted the concept of finance in business, the need for a continuous flow of finance to sustain business. The unit also explains the different ways of sourcing for finance -how loans can be obtained and where to obtain it. The sharing of cost of business, profits and lost were also highlighted in this unit and other methods of financing businesses whether big or small investment.

TUTOR-MARKED ASSIGNMENT

1. Explain different ways of financing a business-in both one-man and in partnership. 
2. Describe the method of sharing the cost of a business