Keep It Goin'

Don't let high interest rates squelch your growth plans.
This story appears in the December 2000 issue of Entrepreneur. Subscribe »
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Are rising interest rates causing you to rethink growth? That could be a mistake. If profits are healthy and financing rates are good, then borrowing for expansion is probably worth it, say experts.

"A thin-margin business may have to be conservative, but one with fat margins should keep moving forward," says Marc Kramer, author of Small Business Turnaround: Revitalize Your Struggling or Stagnant Enterprise (Adams Media Corp.).

George A. Cloutier, chair and CEO of American Management Services Inc. of Waltham, Massachusetts, agrees, though he offers a caveat: "With rising interest rates, you need to make sure this money will make good money for you," says Cloutier, who helps small and midsized companies improve profitability.

How much return in profit will you receive on each borrowed dollar? Will you make money with the borrowed money, or just pay bills? Answer those two questions, and your path should be clear.

Ellen Paris is a Washington, DC, writer and former Forbes magazine staff writer.

Edition: October 2016

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