According to statistics from the Federal Reserve, corporate debt is now at its highest level ever, with companies holding more than $11 trillion in debt. If your business is overwhelmed with debt, it’s time to take action and start working on reducing the debt so your company’s financial health can improve. Here are some strategies to help a business get out of debt and improve its financial practices.

Create a Strict Budget

First, work with your leadership team to create a strict budget. Have a system set up for accounting, spending, and money management so you can see exactly what you’re spending your revenue on and get greater control over your expenses. You may need to consult with a forensic accountant to audit your current budget and make some improvements.

Limit Expenses

After getting a clear overview of where your money is spent each month in the business, the next step is to start cutting back on expenses so you can tackle your debt. Look for opportunities where there may be some waste that you can eliminate from your budget. Cutting back on travel, energy usage, and employee perks may make sense.

Consolidate Debt

Another way you can save on your costs each month is to consolidate your debt. If you have multiple business loans at a high-interest rate, you could save more by getting one low-interest rate loan to pay them all off. Talk to a loan provider to get help with consolidating.

Improve Invoicing

You may also need to reorganize your invoicing process for faster payment. Change up your invoicing agreement with clearer terms and more options for payments with a free invoice template. Develop your own invoicing template to make the process more efficient. Choose a pre-made invoice template and customize it with your logo, colors, name, and product details to make things smoother.

Increase Revenue Streams

Your company can also improve its financial standing and reduce debt by bringing in more revenue. Look for ways to increase your customer base and get more sales if you have a retail business. Work with your team to convert more contacts to sales and improve your monthly revenue stream.

Consult an Accountant

Businesses struggling with debt may also want to consult a skilled accountant to save money on taxes. An accountant can look through your financials and give you advice about how to reduce your company’s tax liability or take advantage of tax credits.

Outsource Work

Another way you can reduce your monthly expenses and leave more room in your budget to pay off debt is to lower your labor costs. Instead of hiring additional full-time workers for your team and paying employment taxes and benefits, consider outsourcing some jobs. Work with offshore freelancers for some projects to save on labor expenses.

Negotiate With Vendors and Suppliers

Finally, talk to your vendors and suppliers to get some details about possible discounts or flexible payment options for materials or other necessities. If you have a good relationship with your partner vendors you may be able to negotiate a lower price and put that money into paying down your debt.

When your business is saddled with debt, it may be challenging to envision a future beyond your current struggles. Make a plan to get your company out of debt and move forward with a better financial future.