Growth & Jobs | Strategic planning key to maximising business loans – JN Bank executive

Entrepreneurs looking to grow their businesses must have a clear financial plan to ensure their loans are utilised effectively, allowing them to maximise their investment and achieve long-term success.

That is the advice from Gillian Hyde, deputy managing director, JN Bank, who emphasised the importance of strategic planning to securing business financing.

”It’s crucial for entrepreneurs to have a strategy for how they will use the funds. By taking a proactive and well-planned approach, they can optimise the benefits of their loans,”she said.

“A well-thought-out strategy ensures that the loan is used effectively to expand operations and increase the likelihood of the business being profitable. When used well, borrowed capital can become a stepping stone to new opportunities and strengthen the business,” Mrs Hyde said.

The financial management professional noted that by carefully mapping out their business goals, entrepreneurs will be in a better position to identify areas to allocate funds that will have the greatest impact, such as purchasing equipment, increasing inventory, hiring staff, or expanding marketing efforts.

“Investing in modern technology or upgraded equipment, for example, can significantly enhance your business’ overall efficiency and the quality of your products or services. Outdated machinery can slow down operations, increase maintenance costs, and limit your ability to meet customer demands,” she explained.

She continued: “If the business faces slow seasons, a loan can keep operations running smoothly during those periods by helping to cover essential expenses like rent, salaries, and inventory while ensuring you retain valuable employees and remain prepared for peak seasons. A loan, therefore, will position the business for long-term growth and competitiveness.”

DISCIPLINED APPROACH

Breggett McCalla, operator of Steel Toe Shoes Warehouse on Barracks Road in Montego Bay, attests that strategic loan management can be a game changer for small businesses. When she started her business more than 30 years ago, she specialised in steel-toe shoes and leather goods. However, through the wise use of business loans over the years, she has successfully expanded her offerings to include construction tools and household linens which allowed her to widen her customer base.

“You have to know what you are doing with the money. You have to think before you take it. Buy the right stuff so that it can ‘turn’ (sell quickly). You cannot buy dead stocks (slow-selling goods). Know what you are doing,” she advised.

“Some people take [loans] and do foolishness and when the time comes for the money to be paid back, that’s when they will be in trouble,” she said while cautioning entrepreneurs to use business loans for only the intended business purpose.

Due to McCalla’s disciplined approach to making good use of the loans, Steel Toe Shoes Warehouse has expanded its customer base.

Hyde explained that poor management of loans can negatively impact the financial health of the business and stressed the importance of incorporating loan repayment strategies into overall financial planning.

“Missed payments and/or unstructured repayments can lead to financial challenges making it more difficult to secure future funding for other investments. By incorporating loan payments into their overall budget and cash flow projections, business owners can stay on track.”

For more than two decades, JN Bank Small Business Loans has been providing loans to entrepreneurs to grow and strengthen their small and medium-sized businesses. The company works closely with business owners to help them make informed financial decisions.

“We guide entrepreneurs through the lending process, ensuring they have the knowledge and support to use their loans wisely. Our goal is to empower businesses to grow sustainably and contribute to economic development,” Hyde maintains.