Getting your business up and running is an incredible achievement and you’ve probably spent years working on it. As an entrepreneur, this part of the process may have come naturally to you. Many startup owners struggle to take the next step: promotion. Unless you’ve studied marketing, you don’t know where to start.
The good news is that in 2022, marketing is easier than ever. Social media marketing makes it possible to reach millions of potential customers around the world with just a few clicks. You create a post with an image and write copy, then choose your audience and set a budget. It’s that simple.
Although social media marketing is effective and inexpensive, the costs will still add up. Plus, it won’t be the only type of marketing you engage in. You may also need to research other means of promotion and could benefit from hiring a person or company to market for you.
But what happens if you have no more capital to work with? You may consider taking out a business loan for marketing purposes. There are different types of business loans available. Here are the loans you can use to promote your business.
The most traditional type of loan you could take out to promote your small business is a term loan. It is a fixed amount of money loaned at a fixed interest rate. You select a period or duration over which you will repay it.
If you took out a loan to start your business, this is probably the type of loan you chose. It’s perfect when you know how much capital you need. You can get this type of loan from banks or private lenders. As with any other business loan, you will pay high interest rates if you don’t have an asset to use as collateral. Nevertheless, they remain cheaper than other forms of financing.
Business line of credit
A business line of credit is a type of loan that basically works like a credit card. Instead of taking a lump sum of money which you then start paying back, the money is simply made available to you. You can choose to use some or all of the funds available, but only pay for what you have used.
This is perfect for businesses that aren’t yet sure how much they will need to spend on marketing and promotion. You can start small with social media ads and scale up as needed.
Interest rates on business lines of credit tend to be high, but you only pay interest on the amount you’ve used.
Working capital loan
A working capital loan is similar to a term loan, except the term is usually much shorter. These loans are taken out by companies to cover the funds they need to operate on a daily basis. Since promotion is one of the most important parts of running a business, a working capital loan can be used to pay for all the marketing approaches you use.
Taking out a business loan to promote your business can be a great investment. You will have to repay the amount used, with interest, but a good promotion will eventually pay for itself (and much more).