Debt Equity Ratio for Small Businesses

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Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.
What Is a Debt-Equity Ratio?
How to Calculate Debt Equity Ratio
Debt-Equity Ratio Calculation Example
Why Debt Equity Ratio Matters
6 Ways to Help Lower Your Debt Equity Ratio
1. Prioritize Paying Down Debt
2. Consider Consolidating Debt
3. Have a Plan for Your Debt
Hiring employees who can help you serve more customers Expanding office space to accommodate growth Purchasing larger orders of inventory to save per unit
4. Work on Revenue-Building Activities
5. Lower Cost of Goods Sold
6. Have Efficient Systems in Place
The Takeaway
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About the Author
Su Guillory is a freelance business writer and expat coach. She’s written several business books and has been published on sites including Forbes, AllBusiness, and SoFi. She writes about business and personal credit, financial strategies, loans, and credit cards.
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