Articles

TL;DR

• Reduce company costs and strengthen profitability
• Budget and follow up:
  Keep track of all costs and revenues, analyze regularly, and involve employees in the process.
• Negotiate with suppliers:
  Seek discounts, better terms, and compare alternatives.
• Use technology:
  Automate and streamline processes to save time and reduce errors.
• Review premises and energy costs:
  Negotiate rent, move to cheaper premises, and invest in energy-smart solutions.
• Optimize operations:
  Focus on the most profitable products/services and avoid wasting resources.
• Review insurance and subscriptions:
  Compare prices, consolidate insurance policies, and cancel unused services.

As an entrepreneur, it is a continuous effort to find ways to increase the company's margins and profits. Often the focus is on increasing revenue, but sometimes costs hold the company back. Lowering costs is usually easier than increasing revenue, and it has the same effect on profitability. Here are some practical tips for lowering costs and improving your company's profitability.

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Create a budget and follow up

‍All companies, regardless of size, should prepare a budget for revenues and expenses. By regularly following up and analyzing the budget, you can also identify areas where costs can be reduced and optimize them. Remember to budget for both fixed and variable costs and to make realistic forecasts for the future. Use budgeting tools or software to facilitate the process and stay organized. If you have employees, it is a good idea to involve them in the budgeting process to get their insights and ideas on possible savings.

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Negotiate with suppliers

Suppliers are often willing to negotiate prices, especially if you are a long-term customer or buying in bulk. Contact your suppliers and explore the possibility of discounts or better payment terms. Also, compare prices from different suppliers to ensure you get the best possible price, and be prepared to switch suppliers if you find a better deal. Building good relationships with your suppliers can lead to better service and better opportunities for cost savings in the future.

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Leverage technology

Today, there are many technological tools available to automate time-consuming tasks and streamline processes. For example, by choosing an accounting program that automatically records your transactions, instead of one that requires manual entry, you reduce the risk of human error and save time. Therefore, investigate what technological solutions could streamline the work in your company or replace one of your suppliers.  

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Review premises and energy costs

Premises and energy costs often constitute a large part of a company's fixed expenses, and reviewing these can therefore save a lot of money each month. You can do this by trying to renegotiate lease agreements or moving to cheaper premises. Costs can also be reduced if you switch to more energy-smart solutions, consider alternative energy sources, and implement energy-saving measures. If you review your energy costs regularly, you can often find additional savings opportunities.

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Optimize operations

There is much to gain by optimizing operations, regardless of whether your company sells products or services. Analyze your sales data to better understand which products or services sell the most or have the highest profitability, and focus on these. By focusing on what the company does best, you will be able to increase your volumes and avoid investing resources in something that does not generate a return. 

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Review insurances and subscriptions

Insurances are another fixed expense that can be reviewed if you want to lower costs. Compare different insurance companies and plans to ensure you get the best possible price and coverage. If you gather several insurances with one provider, you can usually also get discounted prices on the premiums. Another area where there is often money to save is subscriptions and membership fees. By reviewing these, you can see if they are services you use or not. If you do not, you can save money by terminating them. ‍

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Reducing costs can be just as crucial to a company's success as increasing revenue. By continuously reviewing and optimising expenses, you can free up time and money that can be reinvested in the company's growth and development.

As a small business owner, there is much more to keep track of than just the work itself, and for many, finance, bookkeeping and accounting can be areas associated with a certain amount of anxiety. Very few become entrepreneurs because they are passionate about financial administration, but the fact is that stable bookkeeping and accounting are crucial to giving the company a stable financial foundation to stand on. To help you keep track of your company's finances and avoid potential problems, we share five accounting tips that you as a small business owner can benefit from.

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What is the difference between accounting and bookkeeping?
Accounting and bookkeeping are often used as synonyms, but even though both relate to business finances, they differ. Bookkeeping is about systematically recording all business transactions. Accounting is a broader concept that includes bookkeeping, but also financial statements, tax returns and reporting. Depending on your type of company, there are different rules for bookkeeping and accounting that you need to adhere to. However, our tips are applicable regardless of how you run your business.
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Keep your finances separate
A first step is to separate your personal finances from the company's finances, which is especially important if you run your business as a sole proprietorship. By keeping your personal and business expenses separate, it becomes much easier to keep track of your finances and avoid confusion when bookkeeping. Therefore, open separate bank accounts for your business and use them for all your business transactions.
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Use a smart bookkeeping program
Today, there are a number of smart bookkeeping programs on the market that make life easier for entrepreneurs, and that don't cost a fortune. Many programs are also fully automated, where the program manages the ongoing bookkeeping automatically if you connect the company's bank account. Investing in a reliable bookkeeping program that can automate much of the daily administrative work is a smart move for all small business owners. It also makes it easier to track invoices, receipts and other important documents. In addition, it reduces the risk of human error, makes it easier to get an overview of the company's financial situation and facilitates when the annual accounts are to be prepared.
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Hire an accountant or bookkeeping consultant
For some companies, it simply doesn't work to do the bookkeeping themselves, but it is more profitable to hire an expert for it. So even if it means an extra cost, it may be worth hiring an accountant or bookkeeping consultant. They are experts in their fields and can help you ensure that your bookkeeping complies with applicable laws and regulations and provide valuable advice on how to best manage the company's finances. In the long run, it can therefore save you both time and money.
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Develop a budget and follow up
Preparing a budget is one of the easiest tools for planning and taking control of the company's finances. Estimate the company's expenses and income and continuously follow up on your budget. In this way, you can get a clearer overview of the finances, plan for investments and ensure that the business is going as you intended. A clear budget that is followed up on continuously also makes it easier if you need to make adjustments or suffer unexpected expenses, especially if you have budgeted to be able to handle these.
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Keep track of taxes
Being aware of which taxes and fees apply to your company is an easy way to turn a potential problem into a non-problem and make it easier for yourself before the tax return. Make sure to pay your taxes and fees on time and use calendar reminders for important dates. It may also be wise to set aside extra money each month to avoid liquidity problems if the tax becomes higher than you planned for.


By following these accounting tips, you can build a stable foundation for your company's finances and reduce the stress surrounding bookkeeping and accounting. A well-managed economy also gives you better conditions to be able to focus on developing and growing your business instead of focusing on administration.

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Artificial intelligence has been a hot topic in recent years and has quickly become an important technology for companies of all sizes. Developments in generative AI, as well as the increased accessibility of AI models via APIs, have led to new types of services with new applications. This has meant that artificial intelligence has gone from being reserved for large technology companies to being accessible to the general public. But what impact can this development have on small business owners, and what are the areas of application? Here are some areas where AI can have a major impact and help small business owners improve efficiency, customer experience, and growth.

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Administration

As is well known, entrepreneurship often involves a good deal of administration. One of the most obvious ways AI can help small businesses is by automating administrative tasks. AI tools can take over monotonous tasks, which saves time and reduces the risk of human error. In accounting and finance, AI can also be a great help in automating bookkeeping, invoicing, and tax preparation. This reduces the workload and frees up more time for other things in the company.

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Marketing 

Marketing can be done in many different ways, both large and small. All entrepreneurs are, to some extent, dependent on marketing to reach out with their offering and attract customers. But even simple productions of text or visual material can be either time-consuming, expensive, or both for a small business owner who does not have it as their primary competence. Generative AI tools, with Chat-GPT and Midjourney at the forefront, have been the big talk when it comes to AI and the possibilities that now exist to quickly generate texts and visual material. Here, AI has the opportunity to revolutionize the work with marketing for small business owners when it comes to producing blog posts, social media posts, email campaigns and other marketing material with minimal manual effort.

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Customer service

A significant advantage of AI is its ability to quickly perform time-consuming tasks. This can be very useful in your customer service efforts. By using an AI chatbot, you can provide instant answers to customer inquiries around the clock and filter out a large number of questions that would otherwise need to be handled via email or phone. This frees up your time while providing customers with faster answers to their questions.

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Skills development

AI can be of great importance for education and skills development, both for you as a business owner and for your employees. You can now access customized training solutions where AI is used to analyze and create personalized training programs. With the help of AI-powered training platforms, where virtual assistants and chatbots provide instant feedback and answer questions, small businesses can achieve continuous skills development. AI can also be used to identify skills gaps and suggest areas for development.

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Forecasting and analysis

Smaller companies rarely have the resources to process complex data for forecasting and analysis. However, AI opens up this possibility. AI can be used to analyze data to identify trends and patterns that can help you make more informed decisions. It can also be used to predict future trends, customer behavior, and market changes, which facilitates strategic planning. In addition, AI can be used to analyze business data in real-time, thereby identifying both areas that are performing well and those that need improvement.

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AI has the potential to open up several doors for small business owners that were previously only available to large companies with large budgets. By using AI to automate time-consuming administration and perform advanced tasks, you as a small business owner can save time and improve your business. However, the specific applications of AI that are suitable for different companies are individual, so start by identifying the needs of your company before choosing which tools are relevant to you. 

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With embedded finance, non-financial companies, such as platforms, marketplaces, SaaS providers or other B2B services can easily integrate financing and offer it directly to customers, a strategy with several business benefits. Here are five reasons to include it in your service portfolio.

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Starting a financing business for small businesses is not something you do overnight. It requires infrastructure, licenses and capital, among many other things. But thanks to embedded finance, non-financial companies, such as platforms, marketplaces, SaaS providers or other B2B services can integrate financing solutions and offer them directly to their customers. Offering financing to your customers means a number of benefits for your company – here are five reasons why you should include it in your service portfolio.

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Your customers need it

It's no secret that access to financing is a major challenge for most small businesses – and has been for a long time. In Europe alone, the financing gap amounts to 400 billion euros, and globally it is in the trillions. This means your small business customers likely have difficulty accessing financing when they need it – something you can help them with. But it's not just about offering a solution to those actively seeking financing. You also open up opportunities for customers who may not be looking for capital right now but may feel more secure knowing they have access to financing if needed. This can give them the opportunity to make investments and ventures they previously refrained from because they didn't think they could finance them. Additionally, it makes it easier for them to manage their cash flow in a flexible way.

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An extra source of income

The most obvious reason to integrate financing is that it gives you an extra source of income – without requiring any major effort or investment on your part. With Embedded, you can integrate our white-label solutions for SME lending into your existing platform in just a few hours of development time. Once it's implemented, you only need to guide your customers to use the service to start generating revenue. You don't need to handle operational aspects, financing, or credit risk – the platform handles everything. In practice, embedded SME financing means you can add a service that manages itself and generates revenue without any risk to your company.

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It increases customer loyalty

Financing isn't just about revenue. Another reason to include it in your offering is that your customers will see you as an enabler of their success because you're helping them solve one of their biggest problems. This, in turn, can lead to even greater profits than the revenue from lending itself. When your customers become more satisfied, they also become more loyal – which improves your NPS score. It creates a positive growth spiral where your customers do more business with you while becoming ambassadors for your brand.

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Customers stay longer

It's not just the customers who become brand ambassadors who stay longer – the average customer does too. Firstly, you get a "lock-in effect" on customers with active loans, as it becomes more difficult for them to switch suppliers during the repayment period. But above all, financing makes your overall offering more attractive. You gain a competitive advantage by offering a service that creates concrete value for your customers. Since access to financing is limited for small businesses, many customers will hesitate to stop using your service – as it would also mean they lose the opportunity to get financing if needed. This helps to lower your churn rate.

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Potential to grow your core business

Interest income, increased loyalty, and reduced customer turnover are direct effects of lending – but in the long term, there are even greater gains. Financing makes it possible for your customers to invest and grow their businesses, which means they will also increase their business with you. In addition to the short-term effects of embedded lending, you can also look forward to long-term growth in your core business by giving your customers the tools they need to succeed.

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Small businesses need financing – and by integrating lending into your offering, you can help them gain access to it while strengthening your own business. With Embedded, you can easily add a lending solution that is specifically developed for the SME segment and seamlessly integrate it into your existing platform, under your own brand. With an application process that takes just a few minutes, automatic data collection, credit assessment, and direct loan disbursement, you can offer your customers an unparalleled financing experience – while creating added value for both you and them.

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Book a demo today to see how embedded lending can help you grow your business.

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Hiring your first employee is an exciting milestone for small business owners, but it also presents challenges. Whether you've hired before or are doing it for the first time, it can feel like a big step that needs to be done right. Hiring is an investment, and finding the right skills and employee isn't always easy. The hiring process can also be costly if it drags on or if the fit isn't right and the process needs to be repeated. Here are some tips and advice to make the process as smooth and successful as possible for you when you're hiring.

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Before you start
To be able to hire, your company needs to be registered as an employer with the Swedish Tax Agency (Skatteverket). If it isn't already, you can register as an employer at verksamt.se. You'll also find practical information about being an employer on verksamt.se.

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Define the need
Before starting the recruitment process, it's important to carefully consider the specific needs of your company. Write down a detailed job description that clarifies the tasks, responsibilities, and goals for the new role. Also, consider the skills, experience, and qualifications required. If you already have employees, it's a good idea to talk to them about the needs and areas they think should be strengthened. Then, formulate a job description, define tasks, and the requirements for the person to be hired.  

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Budget for costs
Hiring involves more costs than just the salary. You need to consider employer contributions, insurance, and work equipment. It's also important to think about potential benefits that can make your offer more attractive, such as wellness allowance and pension. Not all hires provide a return directly from day one. But by making a concrete budget, you can ensure that your company can actually afford to hire and that you can bear the cost until the investment starts to pay off.

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Start searching
Once you've made your preparations, it's time to start looking for the right candidate. Put together a job ad that's relevant to the profile and qualifications you're looking for and publish it in relevant channels. It's important that the description in the ad actually matches the intended role. It's rarely good if the person you hire doesn't feel that the role matched their expectations, and then there's a risk that you won't get maximum return and may have to redo the process. Be open to hiring someone with potential and a willingness to learn instead of focusing solely on having the exact right experience. Sometimes attitude, personal chemistry, and cultural fit can be a better choice than the right experience on paper.

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Conduct interviews & check references
Schedule interviews and prepare questions that can help you gain a deeper understanding of the candidate's skills and personality. Structure the interview so that you cover important areas such as work experience, skills, and problem-solving ability. Also, be sure to assess how well the candidate fits into your company culture. Let the interview be a two-way communication where the candidate also has the opportunity to ask questions and get a feel for the company. Before you decide to hire, it's a good idea to check the candidate's references. This can reveal both positive and negative aspects that don't come out in the interview but can help you make a more informed choice.

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Offer competitive terms
Finding good employees can be difficult, keeping them satisfied doesn't have to be. It can be easy to try to get away as cheaply as possible when you hire, but retaining labor is usually cheaper than finding new. And if your employee doesn't feel appreciated enough or that they're not getting compensation in line with what they contribute, it easily leads to reduced motivation and they start looking for other jobs. Therefore, start by offering terms that are as competitive as possible based on your conditions and the employee's profile so that they're satisfied. Keep in mind that it's not just the salary that matters, but other benefits such as flexibility, development, and a stimulating work environment are just as important.

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Create a good introduction
A well-thought-out introduction is crucial for the new employee to feel welcome and quickly get into their tasks. Prepare an introduction and have a plan for what the employee will work with and how they will be phased into their areas. Be prepared that you may need to support for a while until the person has grasped the work. Also, make sure they get all the necessary information and tools to be able to perform their job effectively. Also, schedule regular check-ins during the first few months to ensure they feel safe and have everything they need.

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Follow up regularly
Schedule regular follow-up conversations with your new employee to discuss how it's going and to provide feedback. It provides an opportunity to catch any problems early and ensure they get the help and support they need to succeed. Follow-up conversations can also be a good opportunity to discuss their development and future goals, which can increase their engagement and motivation. It's also important from your side to be flexible and prepared to make adjustments if needed.

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Hiring is a big step for many small business owners and something that can be crucial to the company's success. By carefully planning and implementing the recruitment process, you can make it easier to find the right employee to contribute to the company's growth and development.

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The Swedish Tax Agency will soon start sending out income tax returns. As a business owner, you need to file both your personal tax return and your business's tax return, which means you have more dates to keep track of. To help you not miss anything, we have gathered the most important dates and things to consider before you submit. 

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Important tax return dates for 2025
Depending on your company's legal structure, there are slightly different dates to keep in mind. You can read about what applies to your specific company on the Swedish Tax Agency's website, but here are the most important dates for 2025:

• February 3, 2025: Income tax returns are sent out to limited companies, trading partnerships, and limited partnerships whose financial year ends between September and December.
• February 12, 2025: Last day to make an extra payment if you think you will have more than SEK 30,000 in residual tax.
• March 2, 2025: Last day to get a digital mailbox to receive the private income tax return digitally.
• March 3-7, 2025: Income tax returns are sent out digitally.
• March 18, 2025: The tax return opens.
• May 2, 2025: Last day to submit the tax return for sole proprietorships, which includes INK1 and the NE appendix.
• May 12, 2025: Last day to submit the VAT return as a sole proprietorship if you declare VAT once per year.
• August 1, 2025: Last day for submitting the tax return for limited companies, trading partnerships, and limited partnerships with financial years ending between September and December and submitting Income Tax Return 2-4 (INK2-4). For limited companies, a K10 form is also required if dividends have been distributed.‍
• November 12, 2025: Last day to pay preliminary tax for sole proprietorships.‍
• December 8-12, 2025: The Swedish Tax Agency issues final tax statements.

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Important preparations before filing your tax return
To ensure that the tax return process goes as smoothly as possible, it is important to keep your accounting in order. Here are some important tips:

• Make sure your accounting is up to date: By continuously updating your accounting, you avoid the stress of collecting information when the tax return deadline is near.
• ‍Prepare the appendices: Check if you need appendices such as NE, K10, N3A, or others depending on your company type.‍
• Update company information: If your company has changes that may affect the tax return, make sure these are correctly reported before submitting.

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Company form and tax return
The type of tax return you need to submit depends on the company's form. Here is a brief overview:
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• Sole proprietorship: You submit the Income Tax Return 1 (INK1) and the NE appendix‍
• Limited liability companies, partnerships and limited partnerships: You submit Income Declaration 2-4 (INK2-4). For limited companies, a K10 appendix is also required if dividends have been paid.

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‍Things tokeep in mind to avoid common mistakes
To make the declaration easier and ensure that no mistakes are made, consider the following:
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• Check all deductions: Make sure you include all possible deductions, e.g. for entertainment or work space at home. If you run a sole proprietorship, you can use the Swedish Tax Agency's Deduction Dictionary to see what deductions you can, and cannot, make.‍
• Use digital tools: By using accounting software and the Swedish Tax Agency's e-services, you can minimize the risk of errors and ensure that you comply with all regulations.

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A few final words
Filing taxes can be overwhelming, but with good preparation and careful planning, it becomes easier. Keep track of all important dates and use digital tools to simplify the process. Visit Skatteverket for details on each declaration and attachment.

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As 2024 comes to a close, we can conclude that it has been a challenging but also instructive year for Sweden's small businesses. With high interest rates, rising costs and changing customer behavior, it has been necessary to adapt to keep up with developments. At the same time, there have been glimmers of light in the form of new opportunities thanks to digitalization and an increased awareness of the importance of local presence. Here is a look back at the most significant trends in 2024 and some thoughts on what might be useful to take into 2025.

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Trends that shaped 2024

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Continued economic challenges
High interest rates and the general economic situation put pressure on entrepreneurs from several quarters and made 2024 a tough year for many. Particularly in sectors such as construction and trade, many entrepreneurs struggled with reduced demand. At the same time, we can look ahead with more optimism than in years. Inflation has stabilized and interest rates have started to fall. This will benefit businesses both in terms of reduced financing costs, but also increased demand as the economy starts to recover.

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New technology brings new opportunities
AI went from being a trend to actually becoming a tool that helps entrepreneurs. Today, there are a range of AI tools that can help business owners automate tasks, streamline processes and even create materials. For business owners, this not only means new opportunities, but AI can help free up both time and energy in a busy day.

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Sustainability continues to matter
In 2024, customers continued to prioritize businesses that take responsibility for sustainability - both socially and environmentally. For small businesses, this meant that a clear sustainability strategy was not only a way to do good, but also a business necessity. Working with sustainability is also a way to secure the company for the future, as it is likely that there will be higher demands on smaller companies in the future linked to sustainability work.

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External events favored local
A world of trade threats, unrest and increased customer awareness led to the return of local becoming a trend in the past year. Customers came to value face-to-face meetings and businesses with local roots. This made social media, storytelling and community presence important tools for building trust and loyalty.

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Things to consider for 2025
Although 2025 looks set to be a better year for Sweden's entrepreneurs, lessons can be learned from the past year to build for the future.

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Build buffers and be flexible: Now that times are hopefully getting better, it's a good idea to start building up your company's buffer. This way, you can be better prepared if times get tougher again.

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Make use of new technologies if you don't already: AI and other digital solutions can help you streamline your business, and if you haven't tried the tools that are now available, now is a good time to do so. It can open up new opportunities for your business and free up your time to focus on developing your business.

Be proactive: Nowthat customers are starting to return, it's a good idea to start planning well in advance so you can gain market share during the year. So do your research
and start working on your customers instead of waiting and hoping they will come to you.

Think about IT security: The threat of hacker attacks and fraud is growing, and both businesses and individuals are increasingly affected. Is your company's IT security not quite up to scratch? Then 2025 is the year to take action! Take control and read more at sakerhetskollen.se/foretag

2024 has shown that small businesses are resourceful and resilient when times get tough. By staying close to customers, taking advantage of technological opportunities and investing in sustainability, you can set yourself up for success in 2025.

Most entrepreneurs want to grow their businesses, and while it can be challenging, it is also very rewarding. Growing your business can be done in a number of ways but always requires strategic planning, careful execution and a willingness to adapt to changing market conditions. Here are some tips that can help you on how to proceed and where to start if you want to grow your business.

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Set vision and goals
A clear vision and concrete goals are the foundation of any successful business. The vision tells you what your long-term goal is and acts as a compass that you can use in your decisions and actions to ensure they align with where you want to go. Once you have a clear vision, the next step is to break it down into concrete and measurable goals. Objectives act as milestones and give you clarity on how to achieve the vision. One tip is to do this by using the SMART (Specific, Measurable, Achievable, Realistic, Timed) method to set realistic and motivating goals that give you clear direction and motivation.

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Develop a strategy
A strategy is your plan to reach the goals you have set. Start by conducting a market analysis to understand market conditions, competitors and recent trends. Identify the resources you need in terms of staff, capital and technology. Then create an action plan with timelines and responsibilities for each goal. Keep in mind that the strategy must be flexible to adapt to changing conditions. By having a clear and structured strategy, you can ensure that your company is working towards its goals.

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Understanding your target audience
Understanding your target audience is one of the most important aspects of running a successful business. By knowing who your customers are and what they need, you can create products and services that truly meet their needs. Use market research, focus groups and data analysis to gain insights about your customers. Divide your target audience into segments based on demographics, behavior and preferences. This allows you to tailor your offer and marketing to better appeal to each segment.

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Improve the customer experience
A positive customer experience leads to loyalty and increases the likelihood that your customers will recommend your business. Improving the customer experience can be done in many ways, you can invest in training your team in customer service and making sure they have the tools and resources they need. You can also invest in new systems that make the shopping experience smoother or increase personalization. You can also collect feedback from your customers, both to find out how they think and feel and to show that you value their opinions.

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Expanding your business reach
To grow, you need to reach out to more potential customers and one way to do that is to expand your business. Depending on what your business does and how dependent it is on physical meetings or locations, expansion can vary in complexity. However, expansion usually requires some kind of major investment, especially if you are setting up in a new location or market. You can also expand by partnering with other businesses to tap into their customer base and resources. Partnerships can open doors to new markets and opportunities, and can be an effective way to quickly increase your reach.

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Invest in marketing
One of the most effective and proven ways you can reach out to new customers is through marketing. Effective marketing creates awareness, drives sales and increases customer preference. Different types of marketing serve different purposes, but the basic rule is to have a balance between activities that are meant to strengthen your brand in the long term and those that drive conversion in the here and now. Start by looking at what you are doing today and what you could do to reach out better. You can enlist the help of a brand consultant or marketing agency to help you review your needs and requirements.

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Developing new products or services
Innovation is often the key to differentiating yourself in a market. By analyzing market needs and developing new products or services that address those needs, your business can stand out from the crowd. If you also constantly improve your existing products or services based on customer feedback and technological advances.

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There are many ways to grow your business and there is no right or wrong way. What works for your circumstances is what is right for your business. By focusing on these areas, you can create a solid foundation for growth and success. Remember to continuously evaluate and adjust your strategies to meet changing market conditions and customer needs. With the right vision, strategy and tools, your small business can reach new heights.

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All businesses rely on capital, whether to grow or just to keep the business alive. For many businesses, external capital in the form of a business loan can be something that keeps the company not just alive, but growing and developing. However, despite the fact that virtually all large companies use external finance, many small business owners are reluctant to borrow money.
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Apart from mortgages, personal loans have become largely synonymous with various types of consumer loans. These types of loans are used to pay for property that the person cannot really afford and that has a diminishing value. However, borrowing as a business is different. When you take out a business loan, it is used to strengthen liquidity or to make investments in the company. These will lead to a likely increase in the return of the company, so it should be seen as an investment.
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In fact, not using external financing in your business can cost you money. If an investment is held back for a while because you choose to save for it instead of financing it with external funds, not only do you risk the investment becoming obsolete by the time you can afford it, but you also miss out on the returns it would have generated while you were saving for it. By financing purchases, you can also put your business in a position where you have already sold the asset you financed by the time you have to pay for it, allowing you to use the money in the meantime.

To make it easier to know when a business loan might be right for your company, here are some concrete tips on when and why companies take out loans.
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Expansion and growth
The most obvious time when companies need business loans is during expansion and growth. Expansion usually requires major investments to be made. This may involve hiring staff, developing a new product or moving to new premises. Expansion usually also requires resources to invest in, for example, marketing and creating an infrastructure that can support the expanded business. The majority of businesses rarely have the cash to do this without external capital. However, by financing it with business loans, it becomes possible for companies to make the investments they need to make to develop and grow the business without having to compromise on day-to-day operations.

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Cash flow management
Most businesses encounter cash flow problems at some point, especially smaller businesses where the flow of incoming and outgoing payments is not as constant as for larger companies. Customers may pay late, and at the same time salaries and bills need to be paid on time. Many small businesses also have distinct seasons in their operations, with revenues differing markedly between high and low seasons. Business loans can help balance out these fluctuations and smooth the flow of finances.

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Investment in equipment and technology
Technology is constantly evolving and sometimes businesses need to invest in new equipment or software to stay competitive. Whether it's a new machine for the factory or updated software, these investments can be expensive. Business loans enable companies to make these necessary investments, which in turn lead to improved productivity, efficiency and profitability.

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Stock purchases
For businesses selling physical products, it is important to have a well-stocked warehouse. Sometimes it can be profitable to purchase large quantities of goods to get a discount or to prepare for a peak season. A loan can allow you to make these strategic purchases without emptying your coffers. It also allows the costs of stock purchases to be spread over a longer period and the goods to be sold before the company has to pay for them.

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Managing unexpected expenses
Life as a business owner is full of surprises and sometimes this means that you may incur unexpected expenses that are beyond your control. Equipment can break down, a customer can go bankrupt and orders can be delayed. In such situations, a business loan can provide flexibility and peace of mind and help you cope with these events without affecting your day-to-day operations.

Business loans serve several purposes for companies and can be used in a variety of ways. It is more than just a tool to address immediate financial needs. It is a strategic investment in your company's future and a resource to drive growth, manage cash flows and ensure long-term stability. Whatever your industry or the size of your business, you can create a competitive advantage by understanding and taking advantage of business loans.

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When you start a business, one of the first choices you'll face is what form of business to run. There is really no right or wrong when it comes to choosing a business form, but the form you choose will affect things like start-up capital, taxes and legal liability. To make it easier for you to know which legal form would suit your business, we've put together information on each legal form, what makes them different and which one is suitable in which situations.

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Sole proprietorship
A sole proprietorship is a form of business where one person owns and runs the business in their own name. It is easy to set up and requires no initial capital to get started. One of the main advantages of a sole proprietorship is that it is simple and has less administrative requirements. As it does not require you as the owner to put in any capital, a sole proprietorship also has minimal start-up costs. As the owner of a sole proprietorship, you have full control over the business and all decisions, but you are also personally liable for all debts and contracts. A sole proprietorship also makes no distinction between the business and the owner's finances. A sole proprietorship can have only one owner. It is basically a form of business where you, as the owner, are authorized to carry out business activities in your name and is suitable for sole traders, consultants and small-scale businesses that do not require large investments or employees. If you want to test a business idea without making large financial commitments from the start, a sole proprietorship can also be an easy way to get started, and then convert it into a limited company at a later stage.

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Aktiebolag
A limited company is the most common form of business in Sweden and requires a minimum start-up capital of SEK 25 000. Unlike a sole proprietorship, a limited company is a separate legal entity, which is one of the main advantages of a limited company. The fact that a limited liability company has its own legal personality means that the company is liable for contracts and debts entered into. Instead, the owners have limited liability. Their personal finances are protected from the debts and obligations of the company and they only risk the capital they have invested in the company. A limited liability company can also have several owners, which allows risks to be spread and responsibilities to be shared, and it can be transferred or sold. However, as a limited company has more extensive requirements in terms of administration and accounting, for example, it may be better suited to businesses that require greater investment, have multiple owners or employees.

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Partnership
A partnership is a form of business where two or more people run the business together. A partnership is a separate legal entity, but the partners are personally and jointly and severally liable for the company's debts and contracts. This means that each partner can be held responsible for the entire debt. One advantage of a partnership is that no initial capital is required to get started, making it easy to start. In addition, partners can spread the responsibility and benefit from each other's skills and limited companies can be partners in a partnership. The disadvantage is the personal liability, which may involve a financial risk for the partners. Partnerships are therefore best suited to smaller businesses where the partners know each other well and are willing to share both responsibilities and profits.

Limited partnership
Limited partnerships are similar to partnerships but have one important difference. There are two types of partners: general partners and limited partners. General partners have unlimited liability for the company's debts and contracts, while limited partners only risk their paid-up capital. This allows limited partnerships to attract investors who do not want to risk more than their invested capital. Like partnerships, limited partnerships do not require an initial capital investment and can be set up quickly. The disadvantage is that the general partner has unlimited liability, which always involves some risk. Limited partnerships are therefore suited to businesses that want to benefit from both active co-ownership and passive investors.

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Cooperative society
A cooperative society is a form of enterprise in which members cooperate and carry out activities to promote their economic interests. It has its own legal personality and its members have limited liability, but it takes three or more legal persons to form an economic association. One of the advantages of an economic association is that it can have an unlimited number of members and is democratic, with one vote per member. However, it requires more extensive administration and accounting. An economic association is suitable for activities where members want to work together towards common economic goals, such as housing associations, cooperatives or member-owned businesses.

Non-profit organization
A non-profit organization is an association that is run on a non-profit basis and instead promotes the non-profit interests of its members. For example, culture, sport or social work. The association is a separate legal entity and its members have no personal liability for its debts or contracts. One of the main advantages of a non-profit organization is that it can operate without paying taxes on its income, as long as it is used to further its purpose. The disadvantage is that a non-profit association cannot operate for profit in the same way as other forms of business. A non-profit association is suitable for groups of people who want to work together to promote common interests without the aim of making a financial profit.

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Choosing the right business form
The right business form for you depends on several factors and is influenced by the size of the business, the number of owners, capital requirements and risk appetite. Many people think that a limited liability company is the obvious choice because of its limited liability, but for some businesses, it can cost more than it benefits. It is important to carefully consider your needs and objectives before deciding which form of business is right for you.

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Understanding the differences between the different types of businesses will help you make an informed choice and lay the foundations for a successful and sustainable business.

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In cooperation with Bokio

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In many businesses, the invoice is an important pillar of success. Without getting paid for their hard work, no business can survive. As an entrepreneur, there can be a lot to think about, in this guide we cover everything you need to know about invoices and invoicing. 

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What is an invoice? 

Let's start with the basics: what exactly is an invoice? You could say that an invoice is a document created by a seller and sent to a buyer. Once paid, an invoice serves as written proof that payment has been made. When you do business with other companies, a full invoice should always be issued. 

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Exactly how an invoice looks can differ slightly from time to time and between different companies, there are also slightly different types of invoices that affect both its appearance but above all its function. 

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As a business owner, invoicing is one of the most common ways to get paid, having a good grasp of how to handle invoices, both how to send them and how to pay them is essential to the success of your business. If your business handles a lot of invoices, an efficient invoicing program can make things easier and save a lot of time. 

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What is the difference between an invoice and a bill? 

In everyday language, the words invoice and bill are often used interchangeably to describe the same thing. In fact, they are exactly the same thing: a written demand for payment. 

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As a private individual, the term bill is often used, while invoices are often used from business to business. But bill and invoice mean the same thing. 

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What does an invoice look like?

An invoice can look a little different, depending on industry standards and your preferences. However, there are certain things that an invoice must contain: 

Name, address and contact details of the seller and buyer.

Invoice number and date. 

a description of the goods or services supplied, including quantity and price 

VAT registration numbers of the seller and the buyer. 

The total amount to be paid, including VAT and any other charges or discounts. 

The terms of payment, including due dates and accepted payment methods. 

Any additional information that may be relevant, such as delivery details, contract number or order number. 

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If you invoice customers from other countries, there may be additional items to include. It is common for invoices to differ from each other both in style and form. 

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How to pay invoices? 

How to pay an invoice can vary from case to case, depending on the type of invoice and the solution you use to pay. In most cases, the invoice will indicate how the payment is to be made. 

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A common way to pay invoices is by direct bank transfer. Exactly how you go about this can vary between banks, and there are often several ways to pay an invoice. 

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In recent years, more modern payment methods have emerged, such as Swish and Klarna. Many companies offer customers different options for paying their invoices, leaving it up to the customer to decide what is most suitable. 

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In most cases, the procedure for paying a bill is relatively self-explanatory.

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Dispute invoices 

Sometimes a customer may dispute an invoice, which means that the customer does not accept the invoice. There can be different reasons for disputing an invoice. It could be that the amount on the invoice does not match the amount agreed. In another case, it could be because the service did not deliver the type of quality you agreed on. In a third case, the price may be correct but the wrong type of service or goods have been specified. 

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As long as the disputed invoice has a relevant basis, it is usually easy to find a solution by discussing what has gone wrong with the customer in question. Usually, it's just a matter of crediting the old invoice and sending a credit note to the customer/company. 

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If a customer disputes an invoice, it's a good idea to keep a record of the relevant invoices and communications so that you can substantiate your arguments in case the dispute needs to involve the help of a third party. 

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How to invoice? 

Sending invoices is an important part of running a business, so it's important to know how to invoice your customers. Exactly how you go about sending an invoice will vary slightly depending on whether you send an invoice via a self-employed company, via your own company "manually" or from an invoicing program, for example. 

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Below is a general guide on how to go about invoicing: 

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● Create an invoice 

Use an invoice template or invoicing software to create an invoice. Double-check that all necessary information is included on the invoice.

● Send the invoice to the customer 

Once you have created an invoice, the next step is to send it to the customer. Nowadays, it is most common to send invoices online, as it requires less administrative work and is more time-efficient. 

● Follow up the payment 

Record when the time to pay the invoice expires. If the customer has not

paid before its due date, you should send a reminder. If the customer still doesn't pay, you will have to look at possible measures to recover the money, although this is a very rare situation. 

● Register the payment 

Once you've received the payment, it's time to record it in your accounts and file the invoice. If you use Bokio Business Account, the payment will be matched with the invoice by itself and posted automatically. 

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Invoice template 

For someone who has never sent an invoice before, it can be very helpful to have a ready-made template to start from. Then you get a lot of help along the way and do not have to create the invoice from scratch. 

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Having a ready-made invoice template not only saves you from feeling insecure about whether you have included all the content on the invoice, it can also save you a lot of time by just changing the details every time you send a new invoice. 

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There are a number of different invoice templates available on the internet, before using any it is important to ensure that it is a credible company and that the invoice template contains everything you need to invoice your customers. 

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All businesses are required to keep records of their business transactions, which means you need to have an accounting program for your business. Many accounting systems have integrated invoicing functions, so you don't need to have a separate system for invoicing and accounting. Another advantage of invoicing from your accounting software is that your invoices are integrated directly into your bookkeeping. 

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Can you invoice without a company? 

Yes, you don't have to start your own business to send invoices. Nowadays, there are a number of so-called self-employment companies on the market, whose business model is that you send invoices through them in exchange for a fee.

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Self-employment agencies simply act as an intermediary between you and the customer you invoice. At the time of invoicing, self-employed workers pay taxes and social security contributions on your behalf. 

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However, if you plan to invoice on a regular basis, it is much cheaper to set up your own business and invoice that way instead. 

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Apart from not having to pay a fee on each invoice, there are many advantages to running a business, such as the possibility of deducting equipment and the possibility of collecting low-taxed dividends (if you have a limited company). 

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Invoice purchases 

Invoice factoring is a financial service whereby a third party buys a company's invoices. As the credit period on an invoice is usually 30 days, this means that the company is out of pocket during this period. 

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To avoid this, you can sell your invoice through invoice factoring, where you get paid directly and the company buying the invoice is responsible for collecting the payment from the customer. This is done in exchange for a fee, often equivalent to a few percent of the invoice amount. 

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Invoice discounting can be particularly useful for businesses with long payment times or experiencing temporary liquidity problems. It can also be a solution for small and growing businesses that need extra capital to finance expansion. 

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Payment terms on invoices 

The payment terms on an invoice include the rules and conditions that determine how and when a customer should pay the invoice. It is up to the seller to decide what these are, based on the legal framework in place. It is important that the payment terms are clearly communicated on the invoice. 

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Common payment terms include, among others:

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Payment methods 

Different companies accept different payment methods. Bank transfer, Swish or card payment with Visa or Mastercard are common payment methods. 

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Interest on arrears 

It is important to make it clear what happens if the recipient does not pay the invoice within the specified timeframe. The payment terms you choose for your business can have an impact on how your customers feel about doing business with you. 

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If you have a long credit period, this may be attractive to the customer, but it also means a greater financial risk for you. On the other hand, a short credit period is good for your liquidity, but it can be stressful for the customer. 

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Due date 

The due date of an invoice is the date by which payment must be received by the seller. This means that if you have paid an invoice on the due date using a payment solution that takes one business day, the payment will be delayed. 

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The due date is usually at the top of the invoice and can be worded in slightly different ways, for example: "payment received by us" or "due date". 

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The number of days the customer has to pay the invoice can vary. Most commonly, customers have 30 days to pay from the time they order a product or service. However, 30 days is not a legal requirement and there can be both shorter and longer credit periods (the time between invoicing and payment). 

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Different types of invoices 

In this guide, we have so far only talked about invoices in general terms, but the fact is that there are many different types of invoices. What they all have in common is that they aim to collect a payment from a customer, but that's where the similarities end. Below, we'll go through the different types of invoices. 

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Invoice on account

An on-account invoice is a type of invoice that is split over the course of a project. It can be seen as a kind of partial payment in advance, and can be beneficial for projects that run over a long period of time or involve large amounts of money. 

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Pro forma invoice 

A pro forma invoice is a relatively uncommon type of invoice and unlike regular invoices, the purpose of a pro forma invoice is not to get paid. A proforma invoice is used as a formal document to explain the contents of a package for export purposes. 

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For example, if you send a gift or a customer sample to a customer abroad, the pro forma invoice serves as a record of the contents of the package, which can help with customs matters. However, the pro forma invoice is not legally binding for requesting payment. 

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Credit invoice 

A credit note is used to correct an incorrect invoice previously sent. This may be necessary if, for example, the customer has paid an invoice only to realize that there was something wrong with the goods or services. For example, the price was not right, the wrong goods were delivered or the service did not meet the agreed terms. 

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A credit note is sometimes referred to as a reverse invoice, negative invoice or credit note. 

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RUT/ROT invoice 

If you perform services that fall under the RUT or ROT framework, you must reduce the amount on the invoice, in order to then have the last part of the work's income paid by the Swedish Tax Agency. Bokio provides support for sending invoices with RUT and ROT deductions. 

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E-invoice 

An e-invoice is an electronic invoice that is integrated directly into various business systems, including accounting software. If you normally send invoices in PDF format, you will need to do manual work to administer the invoice, whereas an e-invoice is handled completely electronically and registered directly in your recipient's financial system or bank.

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Self-billing 

Normally, it is the seller who creates and sends an invoice to the customer. A self-billing invoice, on the other hand, is the opposite - the customer creates an invoice for themselves but in the name of the seller. A self-billing invoice is also known as a reverse invoice. 

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This can be a good solution if you are a consultant who regularly invoices the same customer, as you have a good overview of the time reporting and thus invoice the correct number of hours. 

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Although the customer creates the invoices, the seller is always ultimately responsible for them. 

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Simplified invoice 

A simplified invoice is an invoice that does not have the same extensive requirements as a standard invoice. However, information on when the invoice was issued, who the seller is, what goods or services have been sold and the VAT to be paid must always be included, even on a simplified invoice. 

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Invoicing with Bokio 

Invoicing can be a bit complicated, but Bokio makes it easy. When you invoice in the same place as you book, you don't have to keep track of which invoices have been paid or not manually. Bokio keeps track for you, and posts the payment automatically as soon as an invoice has been paid. 

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Read more about invoicing in Bokio

Design plays a big role in building trust for small and large businesses. Below I will go through how you can use design to your advantage, and tell you about what good design can lead to. You will also get advice on how to find and hire a designer who can help you with your business. But also tips on tools if you want to do it yourself.

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First impressions

A well-designed logo, a simple and user-friendly website, or a professionally designed brochure can create a positive first impression and immediately make your company appear more trustworthy and professional. The opposite, however, can discourage potential customers and give the impression that your business is frivolous. 

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Your brand, your design and your eye for detail are part of what can set you and your business apart from the competition. Graphic design helps you create a unique identity that customers can easily recognize and remember. By consistently using a good logo and other design elements across all marketing channels, you can build recognition and thus increase customer loyalty.

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Design helps you communicate

Good design can help you communicate your message more effectively. Visual elements such as icons or explanatory infographics can simplify complex information and make it more accessible to your target audience. A well-designed brochure or animated video can also highlight key features or benefits of your products or services in a visually appealing way.

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Credibility

Investing in graphic design can help your business appear more professional and credible. A well-designed website, logo or brochure can give potential customers the impression that you are an established and reliable company. This can help you build trust with customers and make it easier for them to choose your business over the competition.
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Increased conversions

Well-designed marketing materials can help increase conversions and drive sales. By creating materials that are visually appealing and easy to understand, you can make it easier for potential customers to take action, such as making a purchase or filling in a contact form. 

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Design is an essential part of any successful small business marketing strategy. From creating a positive first impression to building brand recognition and increasing conversions, design can have a significant impact on the success of your business. Investing in design may feel like an unnecessary expense, but the potential benefits are well worth the cost.

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Find a designer or do it yourself

Help is available in all price ranges. Larger companies often turn to branding agencies. These agencies usually work from a well-designed brand strategy that lays the foundation for all visual work. For a smaller business, it may be more appropriate to hire a freelance designer who can do a simpler job for your brand. Instead, you can do the groundwork to make it easier for the freelancer. Develop a simple brand strategy that can form the basis for the visual work the freelancer will do. 

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There are tons of free tools online to do your design all by yourself, such as Figma and Canva. If your budget is extremely tight, this might be the way to go. However, I would recommend hiring an expert to reach your full potential.

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If you want to take your business to the next level, it's time to invest in good design and a recognizable brand.

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Good luck to you!

In cooperation with Bokio

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Running a successful business requires a good understanding of how your business is performing. Which products or services are generating the most money, or which area is most profitable? Get a better handle on your business finances with cost centers!

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What are cost centres? 

A cost center is a place within an enterprise where costs are incurred. It can be, for example, different departments, functions or units within a company. Depending on your company's size and industry, you may benefit from different numbers of cost centers. 

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By assigning costs and revenues to specific cost centers, your company can see where and how money is spent. This makes it possible to identify areas that are performing well and areas that are performing poorly, which can help you manage your business. 

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If your business consists of two areas, renting out flats and renovating flats, the renting out part might be generating a high profit while the renovation part is breaking even. If your business doesn't use cost centers, you won't be able to see these figures in black and white - but if you were to use cost centers, you could get accurate figures on how the different parts are performing separately! 

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Example of how cost centers are used 

Cost centers and other economic concepts can sometimes be difficult to understand, so let's make cost centers concrete with an example. 

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Benny runs a clothing store. He has different departments in his business, including purchasing, sales and marketing. When Benny does his accounting, he treats each department as a cost center and assigns costs and revenues to the correct area. This way, Benny can get a good overview of the costs and revenues of each department.

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Benny can choose how he wants to divide his cost centers. He can choose to divide the cost center "sales" into even smaller parts, for example by "children's clothes", "women's clothes" and "men's clothes". 

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If he wants to get insights at a detailed level, he can break down cost centers by brand or by category of garments. Instead of getting a picture of the whole business performance, he can get a more detailed picture of his performance, which can be used as a basis if he needs to tighten the budget or make an investment. 

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Who benefits from using cost centers? 

As a self-employed person, you can make great use of cost centers to get a better understanding of where your strengths and weaknesses lie in your business. This will allow you to make more informed decisions to develop your business further. 

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Companies with different areas 

If you run a business that has different areas, it is particularly useful to be able to break down the income and costs of the different areas. But even if you are, for example, a consultant, you can choose to distinguish between different types of services to know what is most profitable for you. 

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The project 

For someone who does a lot of project work, it can be useful to use cost centers to get figures on how different projects are doing financially. It can be particularly useful for someone who runs several parallel projects. 

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A company with few employees 

In a company with few employees, each employee can be a cost center, this way you can see how much each employee generates. 

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In conclusion, most companies have something to gain from using cost centers in their accounting.

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Take full control of your business with Bokio! 

With Bokio, you can create as many different cost centers as your business needs. With bookkeeping, invoicing, payroll, business accounts and automatic reports, it's easier than ever to get full control of your finances! 

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Read more about Bokio

The holiday season is in full swing and summer has so far brought a mix of sun, rain and positive macroeconomic news. But what does it really mean for you as an entrepreneur and what can you expect going forward?

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Inflation is finally falling

Inflation in Sweden has fallen continuously since the peak in December 2022. However, May was disappointing when the inflation figure was unchanged from April and higher than estimated. June, on the other hand, offered really positive news. After being above the Riksbank's target of 2 percent since August 2021, inflation ended up at 1.3 percent according to the CPIF, which is the measure the Riksbank uses. A figure that was lower than both the Riksbank and the market's forecast.

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This is positive news for business owners on several fronts. Inflation puts customers at risk of cutting back on business as their overheads increase. But it also affects business owners in the same way it affects consumers, with high inflation leading to cost increases on purchases of both goods and services. Having more price-sensitive customers while suffering cost increases yourself is a difficult balancing act, but the fact that inflation is now falling will hopefully bring things closer to normal. 

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Bankruptcies are declining

Another piece of positive news from the summer was that the credit reference agency UC reported that bankruptcies fell for the first time in two years. However, bankruptcies remain at record highs for the year as a whole, but a decline gives us optimism for the second half of the year. Just as inflation has several effects, so do bankruptcies. Reducing the number of bankruptcies therefore has a positive impact throughout the supply chain. 

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Key interest rate likely to be cut

So far this year, the Riksbank has cut the policy rate by 0.25 percent in May and in its latest monetary policy decision it signaled that there may be three more cuts this year. The consensus among economic analysts is that there will be between two and four cuts this year and the majority of the major banks believe that the first will take place as early as August. The cut in the policy rate is a relief for both households and companies, which have been squeezed by the high interest rate levels. 

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What does it mean for entrepreneurs?

The fact that inflation is falling, bankruptcies are decreasing and the key interest rate is being lowered is positive for the whole of society. As an entrepreneur, it also means that you can hopefully start to breathe out after the tough period that has been. When the policy rate falls, purchasing power in society increases and as an entrepreneur you can expect sales to pick up again. The cuts will also have an impact at several levels. As interest rates are lowered, your suppliers' costs will fall, which is likely to have a positive impact on your purchase prices.

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In the long run, cuts in the key policy rate will also reduce the cost of financing for businesses, which has a certain lag effect compared to variable-rate mortgages. The cost of investing in your business will therefore fall too. All in all, this summer's positive news means that you, as an entrepreneur, can start to look more hopefully to the future and enter the fall with optimism.

Right now, there is a scam going on where someone is calling from a hidden number, pretending to be Froda and asking you to settle your loan early. The calls are not from Froda and we urge you to hang up if someone calls and asks you to settle your loan early. 

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It happens that Froda calls you as a customer. However, when we call, we never do so from a hidden number. We will also never ask you to identify yourself when we call or urge you to settle your loan early. If you receive a call or text message asking you to settle your loan early, we encourage you to contact our support.

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Want to learn more about how you can work to avoid fraud? Click here for more information

In 2020, the Swedish Tax Agency introduced a temporary possibility to defer tax payments to support entrepreneurs who were financially affected by the pandemic. The support has been extended in stages, but on September 12 this year it is time to start paying the tax. This could cause problems for businesses that don't apply for an installment on time. 

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The coronavirus pandemic was tough on society at large, but one group that was hit particularly hard was the country's entrepreneurs. While revenues slowed down or, in the worst case, stopped altogether, costs persisted. Therefore, a number of measures were introduced to help entrepreneurs financially during a vulnerable period. One of these measures was the introduction by the Swedish Tax Agency of a temporary deferral of payment of employer contributions, deducted taxes and VAT.

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How the respite worked

The deferral could be applied for accounting periods January 2020-January 2021, October to December 2021 and April to June 2022 and was divided into several stages. In the first stage, businesses could apply for a deferral for up to 12 months but no longer than September 12, 2023 (January 17, 2024 for businesses reporting VAT once a year). Thereafter, businesses could apply for an extension of up to a further 12 months until September 12, 2024 (January 17, 2025 for businesses that account for VAT once a year). Thus, depending on when they applied, businesses have been able to obtain a deferral of up to 24 months for tax payments.

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What happens when the grace period expires

Once a company has had a temporary deferral for 24 months, or less if limited by the end date, it will have to pay the deferred tax. The Swedish Tax Agency will send out information about 30 days before the end date of the deferral with information on when the money must be paid and how much interest and fee will be added (the deferral was not free of charge, but there is an additional interest and a deferral fee). For all companies with monthly or quarterly accounts that have applied for an extension of the deferral beyond September 12, 2023, this will be done around August 12. 

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The remission can be paid in installments 

Fortunately, the vast majority of businesses do not have to pay the full amount in one go. When the extended grace period expires, businesses can apply to extend the grace period for up to 36 more months, provided that an installment plan is set up. However, to be able to apply for an installment plan, the company must have been in temporary forbearance for 24 months, or as long as possible if limited by the end dates. 

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The installment plan can be divided into a minimum of two installments and a maximum of 36 installments over a maximum period of 36 months. However, the bulk of the repayment must be made during the first part of the installment plan. 

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Read more about the temporary deferral of tax payments and how to apply for an installment plan on the Swedish Tax Agency's website.

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Starting a business is an exciting but demanding journey. With preparation, planning and a well-balanced strategy, you can navigate the challenges and build a successful business. Sweden, with its supportive business climate and strong culture of innovation, offers great opportunities for entrepreneurs to establish and grow businesses. This guide gives you an overview of what you should consider when starting a business.

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Formulating a business idea

The first step in starting a business is to have a clear and feasible business idea. Identify the needs and behaviors of your potential customers, current trends and potential niches. An effective method is to conduct market research or focus groups to test the impact of your idea. Don't be afraid to adapt your idea based on feedback and new insights. A flexible and responsive approach can be the difference between success and failure.

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Choose your company form

Your choice of legal form when starting a business affects everything from tax management to how you can scale up. So it's not just a matter of making a sensible choice - you should choose the form that best suits your business. A sole proprietorship is suitable if you run the business yourself and if the business is small to begin with. A sole proprietorship offers simplicity and full control, but carries personal liability for debts and risks. Limited companies offer legal separation between the business and personal finances, but require more administration and an initial capital. Understand the differences and risks of each business form to choose the one that best suits your company's long-term goals. 

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Your choice of business form affects everything from tax management to how you can scale up your business. Understand the legal and financial implications of each form, from sole trader to limited company. Consider your long-term business goals and choose a structure that supports both your current situation and future growth.

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The choice of company form is one of the first decisions prospective entrepreneurs face and affects everything from administration and tax management to boundaries between the company and you as an entrepreneur. 

In Sweden, there are four main forms of company if you want to start a business. Each form has its own advantages and disadvantages and is therefore suitable for different types of business. 

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• Sole proprietorship: For the lone entrepreneur running a small business. It is easy to start and does not require any initial capital. However, you are personally liable for all the company's debts and legal obligations, which may involve a higher personal risk.
• Limited liability company: Suitable for larger businesses that have a higher level of risk, if you need to raise external capital or if you want to separate the company's finances from your personal ones. To set up a limited company, you and your possible co-founders are required to provide a minimum share capital of SEK 25 000.
• Partnership: Suitable for companies where two or more people want to run the business together. All partners are jointly and severally liable for the debts of the company. 
• Limited partnership: Similar to a partnership but with two types of partners: general partners who are active in the company and have full liability, and limited partners who are co-financiers but only risk their stake in the company. This is a good option for those who want to have investors without giving them full responsibility.

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Consider which business form best suits your business objectives, risk tolerance and long-term plans. For some, it may be beneficial to start the business as a sole proprietorship and then convert the business into a limited liability company as the company grows, while for others, a limited liability company from the start may be more suitable. It may also be wise to consult a legal or financial advisor before deciding which form of business to choose. 

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Register your company

After you have chosen your business form, the next step is to register your company. This includes registering with the Swedish Companies Registration Office and the Swedish Tax Agency, as well as making sure you have any licenses and permits in place. It is also important to establish solid bookkeeping and accounting from the start and may be beneficial to bring in a bookkeeper or accountant to handle the company's finances if you do not want to or cannot do it yourself. Also, pay attention to trademark protection and intellectual property rights if your business idea involves unique products, services or technologies when you start your business.

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Set a financial plan

Thoughtful financial planning is essential when starting a business. This includes not only securing initial funding but also creating a sustainable financial strategy for the future that includes pricing strategy, cost control and investment. Set a realistic budget that includes both fixed and variable costs as well as potential sources of income. Keep track of your cash flows and be prepared to make adjustments if necessary. A robust accounting system and regular financial reviews are recommended to help you better understand the financial health of your business and make informed decisions.

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Developing a marketing strategy

Marketing is crucial for building your brand and attracting customers. Like anything else, it's easier to succeed with marketing if you have a set strategy for how you want to approach it from the moment you start your business. A marketing strategy aims to build a strong brand that communicates your unique value proposition and should include a combination of digital marketing, content marketing, keyword optimization, and if possible, traditional marketing. Be consistent in your marketing across all platforms and try to build a strong social media presence to interact directly with your target audience. Evaluate and adapt your strategy based on measurable results and customer feedback.

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Plan for scalability

The long-term success of your business depends on your ability to scale and adapt your operations. To do this, you need to have a clear vision of how your business can develop over time. This includes not only product development and market expansion, but also investing in people, technology and scalable processes to handle increased demand and complexity. Being proactive makes it easier to react quickly to market changes and new opportunities.

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Starting a business is a process that requires patience, perseverance and a willingness to constantly learn and evolve. By planning ahead, being persistent and continuously evaluating and adapting your strategy, you can build a strong foundation for your business and achieve long-term success.

Pandemic, high electricity prices and inflation. Running a business is hard enough as it is, and it hasn't gotten any easier as external events change the landscape. Flexibility has always been important for entrepreneurs, but it becomes even more important in times like these - especially when it comes to business finances and funding.

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As a business owner, you are often forced to make decisions without having all the information available and there is often a degree of trying to predict and plan for what is to come. Although events are not usually as disruptive as they have been in recent years - especially not at the interval they have been - change is more the rule than the exception. Businesses grow, unexpected events occur and opportunities arise. 

What was once optimal for your business may not be so one, two or twelve months later. That's why we've made it easy to make adjustments so you don't get stuck with something that doesn't fit the here and now. Has an investment opportunity come up, has the revenue flow changed or do you need some extra liquidity for a period? At Froda, you can easily log in and adjust your loan to fit the needs of your business today.

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Adjust your repayment rate 

Choose between repaying the loan every weekday, once a week or once a month. The frequency of repayment has no impact on the total cost of the loan, but different repayment rates suit different businesses depending on preference and revenue flow. If your company's sales have become more continuous and ongoing, you can change to a higher frequency repayment rate to have less volatility in liquidity. Similarly, if your business gets paid for its products and services at specific times, you can lower the frequency to match the repayments to when there is money in the till.

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Make an additional payment

You can always pay off parts of your loan with Froda without any additional costs. You choose how much you want to repay and the repayment is done automatically by logging in and triggering an extra payment. By making an extra payment, you can reduce your company's running costs. You also lower the total cost of your loan as you reduce the loan amount, which means that your interest costs also go down. 

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Extending your loan

By logging in to Froda, you can always see your available borrowing capacity and increase your loan when you need to. The limit is updated in line with your company's turnover, allowing you to continue investing as your business grows and have an available buffer in case something unexpected happens. Since you are not tied to the amount you apply for, you can also start by borrowing a smaller amount if you want to make an investment, and increase the investment if it turns out well, thus keeping the risk down.

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Extend the maturity

Do you want to reduce the size of your repayments or do you need the money a little longer? You can easily log in and extend the maturity of your loan. This way you can both reduce your company's running costs and have access to financing for longer. 

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Pause amortization

Sometimes you simply need a break. That's why you can always pause the repayment of your business loan with Froda. You can pause repayments whenever you want and as often as you want for up to 6 months. When you pause the repayment, you only pay interest during the pause and thus free up liquidity that can be used for other purposes and reduce the company's expenses for a period.

Most businesses need to raise external capital from time to time. Here are six tips to consider before taking out a business loan.

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Purpose of the loan

Only borrow money when there is a clear purpose for the loan and a plan to use the money to grow your business. This could be to finance a purchase, invest in new premises or hire someone. Borrowing money without a clear purpose means that your business will incur unnecessary costs.

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Loan amount and repayment period

How much you borrow and the repayment period you choose will affect the cost. Borrow only as much money as you need and choose the repayment period that suits you and your business best. Shorter repayment periods mean higher repayments but lower costs. 

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Look at the total cost

It is easy to focus on the interest rate when taking out a business loan, but there are many other aspects that affect the cost of the loan. Origination fees, arrangement fees and administration fees are all things that can have a big impact on the total cost. It is also important to check whether the interest rate presented is annual or monthly. Make sure you know the total cost before you take out the loan so that you don't get a price shock afterwards.

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Which repayment rate is right for your business

There are different arrangements for repaying a loan and it is important to look at your company's revenue flow to choose the most suitable option. For example, if your business has a high proportion of daily sales through card transactions, repaying in smaller amounts on a daily or weekly basis may be suitable as it does not affect cash flow too much. If you are paid by invoice instead, larger monthly installments may be preferable.

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Possibility of early repayment

Needs can change over time, which is why it is important to consider the possibility of repaying the loan early. With an open-end loan, you can choose to repay the loan early if you no longer need it. This way you can reduce the cost of the loan.

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Do your research

Review your options before taking out a business loan. Compare different lenders to see which one can give you the best deal for your business. It's also a good idea to see what other customers think of a lender by reading reviews on sites such as Trustpilot.

As an entrepreneur, keeping track of your company's finances is essential. Stable and well-managed finances ensure that your company can meet its financial commitments, that there is capital available for investment and that it is better able to deal with unforeseen challenges. Here are five tips that can help you when it comes to your business finances. 

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Keep track of all inputs and outputs

A first step in keeping track of your business finances is to understand your income and expenditure. This means keeping a close eye on all financial transactions, such as sales revenue, costs of goods and services, salaries, and other operating expenses. By using digital tools such as an automated accounting system, you can follow these flows more easily and thus quickly identify and address any discrepancies. These systems sometimes also offer analytical insights that help you identify patterns and potential problem areas that could negatively affect your cash flow, and therefore your company's finances.

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Build up a financial buffer

A strong buffer to cope with unforeseen events is important for both individuals and businesses. For smaller businesses, where financial room for maneuver is often more limited and where large fluctuations in the flow of payments are common, it can be the difference between survival and going out of business. A buffer should be large enough to cover your company's operational costs for at least 2-3 months. To build up a stable buffer, you can set aside a percentage of your monthly income, cut back on unnecessary expenses, or restructure your existing debts to reduce monthly costs. 

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Optimizing cash flow

Good liquidity and freed-up capital allow your business to make the best use of its financial resources and avoid periods of high financial stress. One way to achieve this is to try to optimize cash flow and try to get paid by customers as close as possible to when you need to pay your suppliers. By negotiating payment terms with suppliers, you can synchronize payments with your incoming payments. You can give customers discounts for early payments to encourage them to pay faster. 

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Planning for seasonality

Virtually all businesses have some form of seasonal variation in their business cycles. Understanding and planning for these is essential to staying on top of your business finances. During the off-season, you can review costs, plan for the upcoming peak season and make purchases well in advance to get a better price. This way, you can more easily allocate resources during the peak season to ensure you can meet customer expectations. A flexible budget that can be adapted to seasonal needs is key to managing these fluctuations, and external financing can help your business smooth out the peaks and troughs to ensure a more even cash flow throughout the year. 

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Use technical aids

Today, there are a number of technical tools that can make life easier for you as an entrepreneur. It can be anything from automated accounting where all transactions are automatically recorded, to tools that facilitate work with leads, marketing or analysis. The past year has also seen rapid developments in AI, which has led to increased opportunities for entrepreneurs. Through the integration of AI and machine learning tools, you can more easily forecast your company's finances for the future and receive customized recommendations based on your company's unique data.

As a new entrepreneur, you are on an exciting journey and you face a number of challenges and lessons. It goes without saying that there will be mistakes along the way, but don't fear it. Mistakes are part of the process and if you learn from them for the future, they will only lead to development. Because continuous learning, flexibility and willingness to adapt are keys to becoming a better entrepreneur. That said, it is of course better to avoid certain mistakes from the start. That's why we've compiled some of the most common mistakes new entrepreneurs make and give you advice on how to avoid falling into the same pitfalls.

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Insufficient understanding of the market

Overconfidence in how well you know your market is a mistake many new entrepreneurs make. An easy way to get around this is to do a proper market research to get a clear picture of the market, your competitors and what your customers need. Don't underestimate the importance of doing solid groundwork as it will help you in many strategic choices you will need to make, such as product development and marketing.

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Poor control of the economy

There is a lot to keep track of in the beginning and for many, finance is not something they are familiar with or have done before. After all, the vast majority of entrepreneurs start up for reasons other than wanting to deal with the financial side of business. Many new entrepreneurs therefore make the mistake of not familiarizing themselves with the financial side from the start. Not getting to grips with your finances from the start can lead to budgeting mistakes, poor cash flow control and a lack of understanding of basic accounting principles. Instead, learning the basics of business finance or hiring someone to manage your business finances can save you from future problems and ensure your business runs as smoothly as possible.

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Not differentiating enough

A common mistake among start-ups is not differentiating themselves sufficiently from competitors. In a competitive market, creating a unique value proposition is crucial to differentiate and stand out from the crowd. This can be done by offering a unique product or service, creating a distinct brand identity or offering outstanding customer service. Not differentiating yourself makes it difficult to capture market share as an established business, but even more so as a start-up. Study your competitors' offerings and try to identify niches and unmet needs in the market in order to differentiate yourself successfully. By positioning your business in a unique way, you can attract and retain customers who are looking for something that only your business can offer.

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Not taking on board feedback

Feedback, whether from customers, employees or industry peers, is incredibly valuable for business development and improvement. However, it can be difficult to take on board criticism, especially if you are passionate about your business and work, and acting on it requires both openness and humility. Many new entrepreneurs therefore make the mistake of either not taking on board criticism or not actively seeking it, which can lead to missed opportunities to improve your offering, yourself as an entrepreneur or your customers' experience. But taking feedback and using it constructively can be one of the easiest ways to grow and develop. By acting on feedback, you can make necessary adjustments to your business strategy, improve your product or service, and ultimately strengthen your brand reputation and customer loyalty.

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Trying to do everything yourself

Many people who become entrepreneurs are driven by a desire to do things themselves and in the beginning it can be difficult to let go of things. Many new entrepreneurs therefore make the mistake of trying to manage all aspects of the business on their own. This may be due to a desire to save money, a lack of trust in others or a feeling that no one else can achieve the same standard. But trying to do everything yourself can lead to burnout, reduced productivity and even a decline in the quality of work. Learning when you should actually ask for help or bring in expertise is not a sign of weakness, but an essential skill for becoming a successful entrepreneur and something that can ultimately save you both time and money. This is because you can free up time for yourself and focus on the areas that you do best.

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Putting off getting to grips with the administrative side

F-tax, preliminary tax, employer contributions, VAT accounting, input VAT, output VAT, liability insurance, financial year, licenses. The list of concepts that you may need to familiarize yourself with as an entrepreneur is long. It's easy to want to put it off and take it as it comes, but your journey will be easier if you familiarize yourself with what you need for your business from the start. This way, you can avoid unnecessary mistakes and dates you need to keep track of and avoid spending time correcting things. If you feel that it's too much to do on your own, you can always enlist the help of a bookkeeper, accountant and lawyer, for example.

In a rapidly changing world, sustainable growth is crucial to the long-term viability of your business. Developing an effective growth strategy that will last in the long run requires ambition as well as strategic planning and implementation. In this article, we will go through some of the key components of designing a long-term and sustainable growth strategy for your business. This includes getting a sense of the current situation, setting clear goals, understanding your customers, driving innovation, investing in your people, having a strong financial foundation, effective marketing, and continuously evaluating and adjusting your strategy.

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Get an overview of the current situation

Before you start planning for the future, you need to make sure you know where you stand. Every successful growth strategy therefore starts with a thorough analysis of your company's current situation and position. Perform a SWOT analysis to identify your strengths, weaknesses, opportunities and threats. Analyze trends, your competitors, your customer base, and your internal resources to understand how your business differs from competitors, to identify potential opportunities and possible future risks. This way, you can identify the most profitable growth opportunities and avoid potential pitfalls.

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Set clear goals

The next step is to define goals for the company and its growth. This is best done using the SMART model, where goals should be specific, measurable, achievable, relevant and time-bound. The goals you set can be anything from increasing turnover or customer growth, to gaining market share, geographical expansion or launching new products. Your objectives should be aligned with the company's overall vision and ambitions. They should aim to provide a clear direction for the company's development while being flexible enough to adapt to changing market conditions.

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Focus on your customers

Understanding your customers and responding to their needs is central to long-term business success. Regularly collecting customer feedback and conducting market research to understand their preferences, behaviors and problems is therefore a natural part of any growth strategy. Once you have a better understanding of your customers, you can customize your products and services based on insights, thereby setting yourself up for higher customer satisfaction and loyalty. This may involve tailoring your offerings, improving customer service or developing new solutions that meet customers' specific needs.

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Embracing development

History is full of companies that once stood at the top of their category before being overtaken because they failed to keep up with the times. You're never better than your last performance is a common saying that is very much applicable to life as an entrepreneur. For your business to stay relevant, it needs to keep up with the times and the easiest way to do that is to encourage a culture of innovation in your business. This will lay the groundwork for openness to new ideas, technologies and business models. It also makes it easier to adapt quickly to market changes and customer behavior, which is key to sustainable growth. Your growth strategy can therefore usefully include investing in development, encouraging creative thinking among employees, and monitoring technological advances and industry trends.

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Invest in your employees

If you have employees in your business, they are your company's most important asset and ensuring their satisfaction and development is crucial for your business to grow. Your growth strategy should therefore include investing in their training and development, as well as offering career opportunities and benefits that encourage long-term commitment and loyalty. On the one hand, to foster innovation and development in the company, and on the other hand, to create an environment that encourages engagement, collaboration and increases your employees' satisfaction and motivation. Strong teams contribute to your company's culture and brand, which in turn attracts talent and improves your relationship with customers.

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Planning the economy

Finance is a central part of entrepreneurship and its role in a growth strategy is no exception. A solid financial plan is fundamental to managing growth because it doesn't matter how good your ideas are if you don't have the finances to manage them. It is therefore important to include budgeting, cash flow forecasting and strategic allocation of financial resources in your growth strategy. Be realistic in your financial expectations, prepare for different economic outcomes and ensure that there is enough financial leeway to deal with unexpected challenges or that you are able to jump on investment opportunities if they arise.

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Set a strategy for your brand

If finances are central to managing growth, your brand development is central to making it happen at all. In marketing, long- and short-term efforts are usually split, with long-term efforts focused on building and strengthening the brand. A strong brand is crucial to differentiate yourself from competitors and build a loyal customer base. Therefore, include a plan for how your marketing will communicate your brand's values and benefits in the long term in your growth strategy. Your brand is an intangible asset and strengthening it will not only boost your company's valuation, it will also allow you to increase the premium on your goods or services.

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Analyze and follow up

Predicting the future is almost impossible, so be prepared to revise your growth strategy. Analyse and monitor customer feedback, marketing and the external environment on an ongoing basis to make adjustments to your strategy. Flexibility and the ability to adjust plans quickly are crucial to your growth and long-term success. Measuring progress towards your goals and being open to change will ensure that you can maintain your relevance and competitiveness to succeed in your growth journey.

As an entrepreneur, there are many reasons why you might need external financing. Perhaps you have the chance for a larger premises that would increase your turnover. Would you be able to serve more guests with a larger outdoor seating area or do you want to buy a large warehouse for Christmas shopping? Borrowing can be a wise business decision. Here are some good questions to ask yourself before you decide.

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What is the best way to use a loan?

As a business owner, you often know best where your money can do the most good. Perhaps another hairdressing chair would make a big difference to your profitability? Or would a new restaurant oven increase your efficiency? The most important thing is that the loan is used wisely, opens up new sales opportunities and that you have thought through the risks before you borrow. Borrow only for exactly what you need. Don't borrow to solve an acute crisis.

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Will the loan pay off?

A profitable loan provides leverage through increased sales. The only way to find out is to calculate possible additional sales and costs. How many more lunches do I need to sell to make the new outdoor dining area worthwhile? How many additional sales does the new website need to generate?

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What will it cost?

The cost of the loan will vary depending on the solution you choose. Be sure to include all the loan fees. For example, for bank loans, these can include interest, arrangement fees and invoice fees. The time you spend writing the loan application, business plan and administration is also a cost.

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Will I be able to pay back?

Never take out a loan without doing a thorough analysis so that you feel confident that you can pay it back. Calculate what the repayment means for your cash flow. Also consider what it means if the investment does not produce the expected effect.

In cooperation with Toborrow.

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Running and growing a business requires not only hard work, but also sufficient capital. For many entrepreneurs, access to capital can be a crucial factor for growth and success, something that we at Toborrow have seen in many of our borrowers over the years. Let's explore the power of business loans and how it can be a catalyst to push your business forward.

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Expansion and growth

One of the most obvious ways to use business loans is for expansion. Whether it's opening new branches, expanding product lines, or investing in marketing, a business loan can provide the initial capital needed to take your business to the next level.

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Technical upgrade

In today's fast-paced business world, it is crucial to keep up to date with the latest technology. A business loan can be used to invest in new technologies and systems that can streamline operations, improve productivity and remain competitive in the market.

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Stocks and raw materials

For businesses in manufacturing or retail, inventory can be a significant expense item. By using business loans to finance inventory purchases or the purchase of raw materials, companies can ensure they have sufficient resources to meet demand and maximize their revenue.

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Recruiting talent

The success of a company depends to a large extent on its people. Recruiting and retaining talent is crucial for growth. By using business loans to invest in recruiting and training staff, companies can build a strong and skilled workforce that can drive growth.

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Survival and bankruptcy

In times of economic uncertainty or crisis, access to capital can be the difference between survival and bankruptcy for many businesses. Having access to business loans can give companies the necessary financial flexibility to weather difficult times and recover stronger than ever.

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A powerful tool with the right approach

Business loans are a powerful tool that can be used to push your business forward by providing the necessary capital injection for growth and development. But it is important to remember that business loans also come with responsibilities and risks. Before taking out a loan, it is important to carefully evaluate your needs, make a realistic business plan and ensure that you have a sustainable loan repayment strategy in place. With the right strategy and use, business loans can be a valuable resource to take your business to new heights. Learn more about how Toborrow can support your business growth through business loans or other financing.

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For more information on how Toborrow can help your business, visit our website.

Spring is an exciting time in general and for entrepreneurs in particular. The days get brighter, the weather gets warmer and it's a time when you, as well as your employees and customers, feel motivated to set new goals and work towards them. For many industries, spring also marks the beginning of the high season and is a natural time to evaluate the first months of the year, make necessary adjustments to strategy and plan for the rest of the year. There is therefore much to be gained from making investments in spring to lay the foundations for growth. In this article, we will provide tips on investments that are well suited to spring. 

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Premises

Spring is the perfect time to review your business premises. This can range from simple aesthetic improvements to major renovation projects or simply finding new premises. If your premises don't meet the needs of your business, the risk is that your resources are not maximized and your company's productivity is negatively affected. An inspiring work environment will also help to foster creativity and productivity among your employees. For businesses where customers spend time on the premises, the premises become even more important. They are an extension of your company's brand and identity, and a welcoming, inspiring and professional environment can enhance the customer experience.

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Technical tools

Another area worth reviewing is your technical tools. Developments in both hardware and software are moving at a rapid pace and spring is a good time to evaluate whether the tools your company uses are doing the job or not and whether there are new solutions that can automate and streamline processes. Investing in new hardware and software can be worthwhile if the current one still works. But if it means your business loses productivity and efficiency by not upgrading, you need to look at the opportunity cost. Because if the value you lose exceeds the cost of the investment, it means your business is losing out by not upgrading. One area that is particularly relevant to review is your company's IT security to ensure that your systems and data are protected and that you have backups of everything. 

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Warehouse

For any business selling products, the inventory strategy is essential to ensure that there is enough stock to meet customer demand, without being left with unsold products at the end of the season. Analyze your company's data to predict demand, identify the best-selling products and ensure you have enough of them. This way, you can strike a balance between keeping popular products in stock while giving you room to test new products. For businesses with large seasonal variations, this becomes particularly important to plan for the peak season. 

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Campaigns

As mentioned, spring is a time when motivation and optimism are generally at their peak, making it an excellent time to launch marketing campaigns to capitalize on the positive winds. These can be both longer-term brand-building efforts and more short-term sales-driving efforts. It's best to do a combination of both to build loyalty and preference while increasing sales here and now. 

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Expansion

Looking beyond promotions, there are also other ways to grow your business that require a little more planning and consideration. If your business is stable and you want to take the next step, it's a good time to start planning to expand by broadening either your range, your geographical presence or both. However, expansion can also mean exploring alternative business models to complement or replace your current one, or entering into partnerships with other businesses.

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Sustainability

Focusing on sustainability is no longer the preserve of the interested, it is a necessity for all modern businesses. As sustainability legislation comes to encompass more and more companies, there is much to be gained from being at the forefront as a business owner. Investing in sustainability initiatives and working to reduce your company's climate impact doesn't have to mean spending resources on something that won't pay off, quite the opposite. In many cases, it can actually save your business money, make it more efficient and give it a competitive edge over its rivals. So take the time to see if there are opportunities to switch to fossil-free transportation, if there are more sustainable alternatives in your production chain or if you can reduce your waste.

The creditworthiness of your company is very important, as it determines, among other things, the possibilities of obtaining loans and also plays a role in possible partnerships. A start-up business is always a higher risk than an established business, so it is particularly important to be careful with payments if your business is a start-up. Banks and companies also check the owners' finances and you should therefore avoid payment defaults at the private level as well. The personal finances of board members can also affect the risk category of your business. Below, we'll go into more detail on how to increase your company's creditworthiness.

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What do banks and companies look at when determining creditworthiness?

There are many factors that go into assessing the creditworthiness of a company and it is not only the company's finances that are taken into account but also those of the owners and the board of directors. Usually, banks and credit rating agencies look at financial statements, so always make sure they arrive on time. They also look at the company's key ratios and whether there are any payment defaults. As a rule, neither the company nor its owner should have any payment defaults to achieve a high credit rating. The age of the company and the composition of its board are also taken into account.

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After the first annual report, a company's creditworthiness can increase, so start-ups usually have a low credit rating. If you are self-employed, your finances affect your company's creditworthiness. The higher the company's equity, the better its creditworthiness. Other determining factors are the company's profits and margins - a company with good profits over a longer period of time will have a higher credit rating. However, keep in mind that bookkeeping is very important. Also, make sure you have administrative control so that bills are paid on time.

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How to increase your creditworthiness?

As an entrepreneur, you can increase the creditworthiness of your business in a number of ways and the most important thing you can do is to keep your business in order. You need to have a good understanding of your business finances and pay salaries and invoices on time, as well as pay taxes, VAT and employment contributions in a timely manner. You should also review your cash flow and margins, and make sure you don't undercharge to cover all running costs. You should also plan for the low season in your business.

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The financing of your business is also important, with a well thought-out financing strategy you will increase the creditworthiness of your business. Financing should certainly not be used to cover up if your business is not profitable, but it should be used to increase the profitability of your business. It may also be wise to try to replace your financing with a cheaper alternative, or by gathering everything in one place. Last but not least, customer satisfaction is important for your company's credit rating. Satisfied customers will hire you again, which means a steady income, and their good word can bring new customers.

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Conclusions

As with your personal credit score, keeping track of your income and expenditure is a key issue. You should pay bills on time and make sure you have enough income to cover your ongoing expenses. As a business, it's always wise to have a buffer at the start, in case something unforeseen happens. Also, keep in mind that your personal finances and those of your board members can affect your company's credit rating, so check the creditworthiness of those you elect to your board. The better your company's credit rating, the more financing you can get to grow.

Although starting your own business is both fun and rewarding, as any self-employed person can attest, it is not always a bed of roses. Like any living creature, a business has needs that must be met to ensure its growth. And along the way to success, you will make some mistakes.

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Don't be afraid of mistakes

Failure is a natural part of entrepreneurial life, especially at the beginning of your career. By making mistakes and learning from them, you can develop both yourself and your business. Therefore, it is important not to be afraid of failure, but at the same time you should be wary of making the same mistakes several times.

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While you should always look at your failures in a positive light, there are some mistakes that are particularly common among start-ups. By avoiding them, startups can increase their chances of success faster. Below we list seven common startup mistakes and how you can avoid them.

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Weak business idea

The most important step towards successful entrepreneurship is to have a unique and well thought-out business idea. Unfortunately, many companies choose to invest in a business idea that does not have as much potential as they think.

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Therefore, it is important to be clear about what you are selling, to whom and in what way. In particular, examine whether your idea already exists and, if so, how you can improve it to stand out. Don't forget to keep a close eye on your main competitors.

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One tip is to conduct a survey among family and friends before you decide to turn your idea into reality. This way you can get valuable feedback and even ideas for improvements or changes.

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Starting your own business for the wrong reasons

In difficult times with rising unemployment and few jobs, many people are thinking about starting their own business. A common misconception is that entrepreneurship is all about convenience, such as being your own boss and making money on the go.

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Few people are aware of the hard work that running a business requires. It is not uncommon for self-employed workers to work more hours than full-time employees, especially in the beginning. In addition, starting a profitable business takes time and requires patience - something not many people expect.

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If you want to start your own business, make sure you know what is actually required of you, both in the short and long term.

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Economic shortcomings

You will need money to make money, especially in the start-up phase of your business. Many new entrepreneurs think that the income of the business will roll in immediately, but of course this is not the case. It takes time to build up a stable turnover.

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In other words, during the start-up phase, income will be low and expenditure high. After all, this is when you need to make investments in everything from websites and equipment to premises and possibly employees.

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For this reason, it is important that you plan your business budget carefully in advance. How much start-up capital will you need to get by during the start-up period? When will the business start making money? How big will the expenses be?

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If you currently have a job, it may be a good idea to keep it or reduce your hours while you start your business. This will give you financial security, which is particularly important in the start-up phase as start-ups often make a loss in the first few years.

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No business plan

It is not uncommon for entrepreneurs to think that a good business idea is enough to run a business. While the business idea is important, it is nothing without a thorough business plan.

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A business plan should include a detailed description of your idea and your business objectives. It should also include information on everything from competitors and marketing strategy to budget and financing.

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With the help of the business plan, you can easily plan a strategy to develop your business in the desired direction. It can also help you in meetings with potential investors or in negotiations with banks for business loans.

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Read more about business loans and how they can help your business grow at Lånjakt.se.

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Weak digital profile

Digital presence is increasingly important in our digitalized society. Yet studies, such as this one by Clutch, show that only 64% of small businesses currently have a website. This means that many businesses are actually losing customers due to a weak digital profile.

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Whatever your industry, a website is now a must. On the one hand, a website opens up completely new marketing options, such as search engine optimization, while at the same time it can improve your confidence with potential customers.

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You should also be active on social platforms such as Instagram and Facebook, given the large audience there. The more active you are online, the more likely you are to reach the right audience and build a strong brand.

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Fear of change

A common phenomenon among entrepreneurs is that they remain stuck in old patterns, whether things are going well or not. In other words, few choose to develop their business further, even though this can affect profitability.

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If the company is doing well, think about how it can do better. If the results are not as expected, evaluate and reflect to find opportunities for improvement. Maybe you need to change direction? Or maybe it's time to invest in external expertise?

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As an entrepreneur, you should never be afraid of change. Dare to question old patterns and find new opportunities.

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Want to do everything yourself

One of the most common mistakes among self-employed people and entrepreneurs is that they always try to do everything themselves. A common reason for this is because "they do it best themselves".

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Apart from the fact that this attitude can create psychological stress - which in turn can lead to poor performance - it can also slow down the company's development.

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Having the courage to ask for help is important, not only for your own sake, but also for your business. For example, by hiring external consultants with expertise in specific areas, you can reduce the workload effectively. At the same time, you will stimulate business growth as the work will be done faster.

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Don't be afraid to consult people around you either. This is where a wide network can be particularly valuable.

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Executive summary

Running a business is a multifaceted process and sometimes you make mistakes. Never be afraid to fail, but make sure not to repeat past mistakes several times. If you do, it is a sign that self-employment may not be for you.

Are you thinking about investing, but unsure of the return? Or have you made an investment that didn't quite deliver the desired results? In either case, it's good to know what marginally diminishing returns mean, to make sure that one of your company's resources doesn't take out another.

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Every business has resources to contend with. These resources are called production factors and determine how much a company can produce. As an entrepreneur, it is good to have a general understanding of how they affect and interrelate, to be able to plan your investments and for the investments to provide the best possible outcome. There are, of course, a number of factors and variables that affect a company's production, but in general it is usually said that there are two basic production factors that apply regardless of what the company produces - labor and capital. Labor is the employees of the company and what they contribute to production, while capital is what is used in the actual production, such as machinery, premises and cash. How much labor and capital are then invested in production determines how much the firm produces of a good or service.

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The benefits of adding an additional resource

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Adding or removing a unit of a factor of production will affect the quantity produced by the firm. The change in the quantity of output resulting from the change in the factor is called the marginal product. For example, the marginal product of labor is the change in the quantity of output that would result from the increase or decrease of one worker. More often than not, firms seek to increase their capacity, so they choose to increase either the firm's labour or capital. Increasing a factor of production will, in most cases, lead to increased utility for the firm. However, if one factor of production continues to increase, while the others are held constant, it will eventually lead to a decline in the rate of production. The result will be that the benefit, or return, of adding an additional unit of the same factor of production will be less than the previous one. That is, production will yield marginally diminishing returns.

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Marginal diminishing returns are something you should consider when thinking about investing, as they can have an impact on whether or not you get the maximum benefit from the investment. This does not mean that you need to do a lot of economic analysis before every investment you make in the company. It means that it is good to keep in mind how an investment that adds one factor of production to your business may affect other factors. Let's take a hairdressing salon as an example. A hairdressing salon that has four hairdressing chairs, but only one hairdresser, the marginal rate of return will be the same for each additional hairdresser employed until the four chairs are filled. If the salon hires a fifth hairdresser, the marginal return for this hairdresser will be less than for hairdressers 2 to 4. The fifth hairdresser will still provide some increase in output as he can do other tasks and cover for the others when they have lunch or are sick. However, as there is no barber chair for this person to use, the increase in production will be less than it was when the salon hired the other hairdressers. If the salon then continues to employ hairdressers without investing in more hairdressing chairs or a larger space, it will eventually reach a point where production actually drops. On the other hand, if they were to invest in an additional chair for each hairdresser hired, the marginal rate of return would be constant.

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How it can affect your investments

The reality is of course more complex than the example above, but the principle can be applied to most investment situations your company may face. When investing, it is helpful to have an understanding of how your company's resources interact with each other. If you are planning to expand, you can expect that investments in both labor and capital will be required to have the desired effect on your company's output. And if you feel that a recent investment has not quite yielded the results you had hoped for, it may be that the marginal product of the resource you invested in has become diminishing and that you need to balance it out by investing in another of the firm's factors of production as well. Knowing about marginal diminishing returns can therefore help you to plan your investments, identify the needs of your business and then make decisions that will allow you to maximize the return on your investment.

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Does your company need help with financing?

Froda was founded in 2015 with a clear idea - give small and medium-sized businesses the same opportunities to grow as large ones. With our service, we make it easy and affordable for entrepreneurs to invest in their ideas. By digitizing the process, we've made it possible to help more businesses with financing tailored to their unique business and its needs. A smarter business loan, simply put.

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Today, we are one of Sweden's fastest growing fintech companies and have helped more than 15,000 companies grow. Froda is a credit institution covered by the state deposit guarantee and is under the supervision of Finansinspektionen (FI).

For businesses to grow, they need to make investments. These can be financed either by reinvesting the business's own funds, or by raising external capital. But how should you think as an entrepreneur when faced with the choice of whether to finance an investment with equity or external financing?

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Equity capital

Equity is the difference between a company's assets and liabilities. When a company generates profits, its equity increases. For the company to continue to grow and hopefully generate higher profits in the future, it is often a natural choice to reinvest all or part of the profits in the business. This can be done by the company making investments, paying off debt or increasing cash to improve liquidity. Using equity and current income is the most common way of financing investments among Swedish entrepreneurs.

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External funding

Access to capital is a prerequisite for businesses to grow. However, for many small and growing businesses, their own capital is not enough to invest and they need to rely on external capital to finance their investments. There are several different forms of external financing, but for most, business loans are the most common way to finance investments.

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Investing with equity or external financing?

Whether it is best to invest with equity or with the help of external financing can differ from company to company and from investment to investment. It is therefore important to have an understanding of how they differ, how they affect key performance indicators in the company and when the investment is expected to pay off. This will enable you to choose the financing that will allow your company to get the maximum return on investment.

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Solidity

When you invest, your company's equity ratio will increase or decrease differently depending on whether you reinvest the equity or use external financing. The equity ratio is a measure of the proportion of assets financed by equity and is used to describe the long-term solvency of a company. When equity is reinvested in the company, the equity ratio will increase and, correspondingly, it will decrease if investments are made with external financing.

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When investing, it is therefore a good idea to look at the equity ratio of your company. If your company has a low equity ratio, investing using your own capital is preferable. This is partly because the equity ratio will increase and partly because the company's own money may generate a better return than if it were just sitting in the company's account. However, investing with equity is relatively expensive compared to, for example, a business loan, as most entrepreneurs want to generate a higher percentage return than the interest rate that the loan has. If the company has a high equity ratio, it is therefore preferable to finance the investment with external funding.

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Type of investment

The type of investment you intend to make can also have an impact on which financing may be preferable. As mentioned above, reinvesting profits in the company is an important part of healthy entrepreneurship, but a relatively expensive way to finance investments. Investing with your company's own capital also means drawing on your liquid assets, which affects your company's short-term solvency. Therefore, if the investment is made in an asset that can be quickly realized and generate income for the company, equity can be a good way to finance the investment. However, if the investment is made in an asset that will be used over a longer period of time, it is usually better to finance it with external capital. This way you avoid risking the liquidity of the company and thus the short-term solvency. However, it is not only the ability to pay the company's debts that affects liquidity and the type of financing you should choose. Almost all businesses are run for profit and with the aim of generating a return for the owner. Therefore, if your business has both good solvency and liquidity, financing with a business loan, for example, can allow you to both drive growth in the company, while you, as the owner, can use some of the liquid funds to distribute some of the profits to yourself and get a return for your work.

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Invest in time

Another aspect to consider is when the investment needs to be made. Most Swedish companies are restrictive when it comes to debt and choose to use their own capital and save for investments, which is not optimal. If companies save for investments, there is a risk that the investment will be made too late and thus not have the desired effect. When you wait to invest, you also miss out on the expected return while the investment is pending. This means not only that you as an owner miss out on increased profits and potential dividends, but also that the growth of the company is impaired as the return could have been reinvested in the meantime.

When renovations are more expensive than planned, when the unexpected happens, or simply when the company needs an injection to reach the next peak. Then liquidity can become an obstacle to growth.

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What is liquidity and how do I increase it in my company?

Liquidity is a measure of your company's short-term ability to pay, or access to cash, in relation to short-term liabilities, such as accounts payable. In short, improved liquidity means improved ability to pay. For example, if the company incurs unexpected expenses that exceed its short-term solvency, liquidity problems arise.

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Temporary liquidity problems are common

In some industries, revenues vary greatly depending on the season. For example, many service and tourism businesses are fully booked during the high season, only to have hardly any customers at all a few weeks later. As a small business owner, it can be difficult to manage these large fluctuations. And sometimes the downturns are deeper than budgeted for, which causes problems.

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Liquidity problems in the off-season can be doubly problematic, as this may be when you have time to invest - and thus grow in the peak season.

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A loan could be the solution. Think carefully about your needs before you borrow to make sure you can pay back. Borrow only for exactly what you need.

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When the unexpected happens

Small businesses are particularly vulnerable to unexpected expenses. The longer it takes to find a solution, the greater the impact. The café owner whose awning falls down in the middle of the high season needs a new awning immediately to minimize the impact. The restaurant owner with a broken oven needs help immediately.

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If you haven't had time to build up a buffer for unexpected expenses, external financing is an option that gives you quick access to cash when the unexpected happens.

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Sometimes wise to settle accounts payable with loans

Unforeseen events can throw a spanner in the works, and it can be really annoying when you have trouble paying your supplier invoices. A business loan is often a better solution than risking your company's relationships with a non-payment. If you run an otherwise well-managed business, settling occasional accounts payable with a loan need not be a problem.

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Increase liquidity with a loan - but keep this in mind

If you run a small business that suddenly loses turnover or has unresolved accounts payable, you should carefully analyze the reasons for this. Some things to consider could be:

1. How are competitors doing?
2. Is the recession only affecting you?
3. Do you have profitability problems that can be corrected?

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You may need to invest to reach more customers. It could be a new product, new equipment or marketing to an important customer group to increase sales. Think carefully about your needs before you borrow. Are you sure this particular investment is right? Calculate your capacity to repay the loan.

In partnership with Bokio


When you've started your own business, there's a lot to think about, from how best to generate profits from your business idea to how to find new customers for your business. Learning about taxes might not be the thing you're most looking forward to when you start your own business - but it's still an essential ingredient for success. Learn everything you need to know about taxes as an entrepreneur with this guide.

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How much tax do you pay?

There is no simple answer to this question. The amount of tax you pay depends on many factors, including your income, your age, where you live, the type of business you run, the deductions you are entitled to and more. If you earn less than €22,300 in an income year, you pay no tax at all, and if you earn more than €613,900 in a year, you pay around 50% tax. After reading this article, you will hopefully have a better understanding of how different taxes affect your income.

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Different types of income affect the tax you pay

When talking about taxes, it is good to first understand what the different types of income mean. There are three different types of income that determine the taxes you pay, and distinguishing between the types of income can make it easier to understand your overall tax situation. Within each type of income there are many different taxes that apply, so you can see the types of income as general categories.

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Income from business activities

The business income category is a relatively broad tax category that includes all types of business activities, such as sole proprietorships, partnerships, limited partnerships and limited companies. The business income category thus covers companies and not private individuals (although the boundary is fluid for sole proprietorships, for example).

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Income from employment

Income from employment includes money earned through an employment or assignment. If you run a limited company, you pay tax on your business income on behalf of your limited company and tax on your personal income as an individual.

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Capital income category

Capital income includes income and expenditure arising from the movement or sale of capital. This may include, for example, interest expenses or the rental of real estate. For shareholders, a common contact with capital income is when they receive dividends from their limited company and pay corporation tax.

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Taxes in a sole proprietorship

When you run a sole proprietorship, you are responsible for ensuring that the tax is paid, unlike when you are an employee and the tax is automatically deducted from your salary. The first tax you need to familiarize yourself with as a sole trader is F-tax (business tax). If you are employed alongside your sole proprietorship, you pay F-tax with conditions, known as FA-tax.

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Self-employed contributions in a sole proprietorship

Part of the tax you pay in your sole proprietorship corresponds to the social security contributions that employers pay to their employees. In a sole proprietorship, these are called self-employed contributions and consist of, among other things, health insurance contributions, parental allowances, old-age pension contributions, etc. As you pay your own contributions, you are entitled to sickness benefit when you are ill, parental benefit when you have a child, etc. even when you are self-employed.

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Own withdrawal sole proprietorship

When you run a sole proprietorship, you do not have a salary in the same way as when you are employed or run a limited company. All your profits, i.e. the amount left over after deducting expenses from income, are considered as income for tax purposes and can therefore be treated as a salary.

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Once you have paid the preliminary tax on your surplus, the rest of the money is free to be transferred to your personal account. When you withdraw money from your sole proprietorship in this way, it is called a personal withdrawal. When you make a personal withdrawal, your withdrawals are not taxed per se, but the money is already taxed as business profits.

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When you make a withdrawal, it is an expense to be recorded, but not an expense that affects the company's results. For example, if you have a surplus of €50,000 and you decide to withdraw the whole amount as a personal withdrawal, the profit and loss account will still show a profit of €50,000. All that will happen is that your personal account will receive more money, while your business account will receive less money and your cash will decrease.

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Taxes in limited companies

Many people tend to favor the limited liability company as a business form when the idea is to grow the company, thanks to the favorable tax opportunities. Below we review the most common taxes for limited liability companies.

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F-tax

Limited liability companies pay F-tax in the form of debited preliminary tax. Based on the preliminary income tax return or last year's result, you pay F-tax every month. When you receive your final tax assessment notice, you can either pay the tax arrears to the Swedish Tax Agency or receive a tax refund.

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Employer's contribution

Before a salary reaches an employee's wallet, a significant amount has already been taxed from the company's payroll. Employer's social security contributions are a tax that ensures that employees are paid when they are sick, on parental leave or when they retire. In 2022, total employer contributions will amount to 31.42% of gross pay.

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Corporation tax

Corporation tax is a tax paid on the profits made by a limited company during a financial year, so in the event of a loss year, no corporation tax is payable. The corporation tax rate for 2023 is 20.6% and is paid in the form of preliminary tax each month.

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At the end of the year, the tax paid is reconciled with the final tax. Corporation tax also covers capital gains in limited companies, such as dividends. Corporate income tax is therefore part of the first stage of taxation for limited companies. When you, as an employee of your own limited company, receive a salary, you are also taxed as a private individual in a second stage.

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State income tax

For high-income earners earning above a certain amount, the state income tax is added. This means that you will have to pay an additional 20% tax on the amount above the threshold.

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There are different limits to keep an eye on when you are close to the limit to be subject to state income tax; the layer limit and the cut-off points. For 2023, the threshold is SEK 598,500, i.e. if your taxable earned income, after the basic deduction has been deducted, exceeds SEK 598,500, you are subject to state income tax.

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As it can be difficult to know exactly how much the basic allowance is, you can instead use the highest income you can earn before the basic allowance is deducted. This is called the state income tax threshold, and there are two different thresholds depending on whether you are over or under 66.

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For persons younger than 66 years of age, the threshold for state income tax is SEK 613,900.

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For persons aged 66 or over at the beginning of the year, the threshold for state income tax is SEK 683,200.

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The difference is due to the higher basic allowance for pensioners.

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Provisional tax

F-tax is usually paid on a monthly basis in the form of a debited preliminary tax. The amount you pay is based on the amount of tax you paid last year or the amount you declared in your preliminary income tax return. At the end of the financial year, your tax paid is reconciled with your final tax.

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When do you get a tax refund?

If you have paid more preliminary tax than you should, you will get money back from the Swedish Tax Agency. Many people wonder when you will get money back from the tax, and the answer varies depending on when you submitted your income tax return.

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If you filed your tax return before March 30, you will receive a refund on April 5-7.

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If you filed your tax return after March 30, you will receive a tax refund between June 8 and 9.

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Basic deduction

The basic deduction is a deduction made to reduce your taxable income and thus reduce your tax. If you are a sole trader, the basic deduction is deducted from your business income and if you are a limited company, the basic deduction is deducted from your salary. You don't need to apply or register for the basic allowance - it is deducted automatically.

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The purpose of the basic deduction is to reduce taxes for the income earner and equalize taxes between different income groups. The basic deduction is higher for low- and middle-income earners and lower for high-income earners. For people earning less than 22,300 in the income year 2023, the entire amount falls away under the basic deduction - meaning you don't have to pay any tax at all. For an exact list of the basic deductions for different income brackets, visit the website of the Swedish Tax Agency.

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Working tax credit

The earned income tax credit is another deduction that reduces your tax base. Like the basic deduction, the earned income tax credit is not something you need to apply for, but is deducted automatically by the Swedish Tax Agency.

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To qualify for the earned income tax credit, you must receive your income through work or business activity; if the income comes from sickness benefit, parental benefit, unemployment benefit or similar, you are not entitled to the earned income tax credit.

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The earned income tax credit can only be deducted from municipal tax; it does not apply to state income tax, property tax or property charges. The amount of the earned income tax credit depends on your income.

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Municipal tax

Municipal tax is a tax that goes to your registered municipality and county council. Municipal tax is the largest tax paid by income earners and in 2022 amounted to just over 32% on average in Sweden. There are variations around the country, with a lowest rate of just under 29% and the municipality with the highest municipal tax having just over 35%.

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Moms

VAT is a value added tax that applies to the majority of goods and services bought and sold. There are three different VAT rates: 25%, 12% and 6%, with the first being the most common. As a business owner, it's important to keep track of VAT, as you add the VAT rate to your price. For example, if you want to invoice SEK 1 000 for a job, you need to add 25% to the invoice to get the right amount.

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VAT is not a tax that affects a company's bottom line because you will always break even in the end. If your outgoing VAT expenses are greater than your incoming VAT income during a VAT period, you will receive a refund from the Swedish Tax Agency, and if your incoming VAT is greater than your outgoing VAT, you will need to pay the difference to the Swedish Tax Agency.

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Marginal tax

The name "marginal tax" is somewhat misleading as it is not a tax that you pay. Marginal tax is a term for the total tax you pay on an increase in income. It is usually said that marginal tax is the tax you pay on your last earned krona.

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For example, if your salary increases by SEK 1,000 and SEK 700 lands in your payroll account, the marginal tax rate is 30%. Usually, the marginal tax rate is about the same as the municipal tax rate, but as you approach the state income tax threshold, the marginal tax rate increases significantly.

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If your salary exceeds the threshold for state income tax of 20%, the marginal tax rate is usually around 50%. If your salary increase of SEK 1,000 means that you get SEK 500 more in your salary account, the marginal tax rate is 50 percent.

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Taxation of benefits

Sometimes employers provide compensation to their employees in addition to their salary; if such compensation pays for a private living expense, it is called a benefit. One of the most common types of benefits is a company car. Like cash compensation, benefits also need to be taxed, both by employers and employees. Employers pay social security contributions on the benefit and employees pay tax.

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As a rule, all benefits are taxable, but there are exceptional cases that are regulated to be tax-free, such as wellness allowances.

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Excise duty

In addition to all the taxes already mentioned, there are specific taxes on particular goods and services, known as excise duties. Excise duties are an effective way for the government to regulate consumption in a desirable direction and also increase tax revenues. Tobacco tax, alcohol tax and tax on plastic carrier bags are all examples where you want to influence consumption through a higher price.

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Bokio makes tax easy

With Bokio's accounting software, you hardly need to think about tax. When you pay your salary, the tax is calculated automatically and the correct amount is deducted. An employer's declaration is then generated, which you simply submit to the Swedish Tax Agency.

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In collaboration with Bokio, Froda customers get a 20% discount on Bokio Premium. ‍

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Go to the offer.

As a business owner, it is easy to spend all hours of the day making your services and products as good as possible for your customers. It's easy to forget that this doesn't matter if your target audience doesn't know you exist. The following article lists marketing strategies that will increase your exposure while adding value to your business.

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Most people with experience of running a business know that marketing is vital to winning customers. Thanks to the internet, there are now several ways to market yourself that are both cheap and effective. In this article, we suggest

1. Marketing via social media
2. Cooperation with other companies
3. How to increase your company's publicity

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Social media marketing

As a business owner, you can use several social channels to reach out to your customer base. You can start a blog, an Instagram account or choose to set up a free business page on Facebook, where you can share everything from other people's posts to your own photos and videos. You can also pay to advertise on social media, where you choose the audience you want to reach and how much money you want to spend on your advertising. This is a great way to reach the public as most people use some form of social media on a daily basis.

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It is easier to build a relationship with your customers via social media, as you can keep a more personal tone than on your website, for example. This type of media also allows you to reach a lot of people very quickly, as your posts can be instantly seen by your network and then in turn spread to their network in just a few minutes via likes and shares. Make sure you create posts that others want to share - encourage this through competitions and discounts. Another advantage of social channels is that they are relatively cheap to use, even for advertising.

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Cooperating with other businesses

Modern marketing is very much about building relationships - not just with your customers. Collaborating with other businesses is very effective. For example, you can use influencers to promote you through their channels, or work with companies with the same target audience as yours to reach out to each other's customer bases. It will increase your exposure and need not cost you anything.

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Another way to collaborate with businesses is to co-host events - the cost is lower when there are more of you. For example, if you have a plumbing company, you can contact construction companies and work together to carry out turnkey projects for customers.

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Marketing doesn't have to cost the earth and doing a good job increases the value of your products and services. Ultimately, it leads to an improved customer experience for your current customers and can result in them recommending you to their loved ones.

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Increase your publicity

Publicity is important - everyone loves exciting news. Does your company have something new to present that a journalist would like to write about? You can also comment on blogs and debate on a topic related to your business, thus drawing attention to your company. The most important thing for a business is to be seen, and preferably to be seen through positive publicity. Always think about the purpose of your publicity, who you want to target and what emotions you want to evoke.

It's getting closer to the time of year when it's time to file your tax return. As an entrepreneur, you need to file both your personal tax return and your company tax return. Below we provide some tips on what you should think about, important dates to keep track of and how the declaration differs depending on the type of company you have.

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Key dates to watch out for in 2024

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3 March

Last day to get a digital mailbox to receive your tax return digitally.

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March 4 - March 8

The declaration is sent out digitally

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March 15 - April 15

The declaration is sent by post for those who do not have a digital mailbox.

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19 March

The declaration opens.

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May 2

Last day to declare.

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13 May

The last day to submit the VAT return for those who account for VAT once a year.

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November 14th

Any tax withheld must be paid, unless your final tax statement states a different date.

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Sole Proprietorship

As a sole trader, you file your business tax return at the same time as you file your personal income tax return. You do this by first preparing your annual accounts and then completing and submitting the NE annex that you receive with the tax return. If you have a turnover of less than SEK 3 million, you can prepare a simplified annual accounts. If you do this digitally, you can then transfer the information directly to the NE annex in the tax return.

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General Partnership

If you are a partner in a partnership, you must submit your N3A annex together with your income tax return, in which you account for your share of the partnership's profits. If you also have to declare for the partnership, this is done in income tax return 4. When this should be done depends on the company's financial year.

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Limited company

The declaration process for partners in a closely held company is similar to that for partners in a partnership. In addition to your personal income tax return, you also have to file a K-10 schedule where you report dividends from the company and any profit or loss if you sold shares in the company. When the limited liability company's own income tax return must be filed depends on its financial year.

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Check the data

As with your personal income tax return, it is important to check the pre-printed information for your company. If there are errors in the control data, there will also be errors in the declaration if you do not correct the data.

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See what deductions you can make

As an entrepreneur, you can deduct expenses that are necessary to run your business - regardless of the type of business you have. However, the difference is that if you run a sole proprietorship, you make the deductions in your income tax return, while the deductions are made in the company's tax return if you run a limited company or partnership. If you run a sole proprietorship, you can use the Swedish Tax Agency's Deduction Dictionary to see what deductions you can, and cannot, make.

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A common deduction is if you run your business from your private home. If you are a sole trader, you can deduct the cost regardless of whether you have a specially equipped workroom or not. If you run a limited liability company or a partnership, the workroom must be furnished in such a way that it can no longer be used for residential purposes for you to be able to deduct it. Instead, you can rent out part of the property to the company. In this case, the company can deduct the rental cost while you, as the owner, pay 30% capital tax on the excess rent.

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Reserves for sole proprietorships

As a sole trader, you should look at the possibilities to reduce your taxable income. This can be done either by moving part of your income from business activity to income from capital by making a so-called positive interest distribution. You can make a positive interest allocation when the capital base in the business is higher than SEK 50,000 at the beginning of the year. You can also make allocations to an accrual fund or expansion fund to postpone the tax effect and to be able to offset future deficits.

After a few tough years for Sweden's entrepreneurs, it finally looks like we're heading for brighter times. 2023 was marked by high inflation, rising interest rates and a sharp increase in the number of bankruptcies. But if the storm clouds were gathering at the beginning of 2023, we are now starting to see a brighter picture on the horizon at the beginning of 2024. The National Institute of Economic Research predicts that wages will rise faster than prices during the year and, after two years of policy rate hikes, the Riksbank is expected to cut it in 2024. This will give both households and companies greater scope for consumption and investment. This may benefit smaller companies in particular, which are generally more sensitive to interest rates and have less room to face tougher times than larger ones. 

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Beyond the economy, there are trends in artificial intelligence, marketing and customer relations that are worth keeping an eye on for business owners, which we'll cover in this article.

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Economy 

As mentioned, the biggest area that will affect entrepreneurs will continue to be the economy and economic developments. Inflation fell at the end of 2023 to levels just above the Riksbank's inflation target of 2% and is expected to fall further during the year. High inflation has been the driving factor behind the Riksbank's increases in the policy rate and as it now falls, the Riksbank is expected to cut the policy rate during the year, which will mean relief for entrepreneurs on several fronts. A cut in the policy rate will lead to a reduction in interest expenditure for both individuals and companies, thereby increasing the scope for consumption. Business owners can thus look forward to a year with fewer headwinds, where sales revenues increase and economic stress decreases. Interest rate cuts may also mean that opportunities for entrepreneurs to raise external capital, and the conditions for doing so, will improve. Initiatives and investments that have been put on hold in recent years therefore have the potential to be realized when it becomes easier to finance them again. 

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Looking ahead, the government also presented two proposals in the fall budget that will make it easier for entrepreneurs both in terms of costs and administration. One is that the turnover limit for when companies need to report VAT is planned to be raised from SEK 80,000 to SEK 120,000 on January 1, 2025. Thus, more smaller companies will not have to add and account for VAT. The second is that they have launched a simplification package and established a simplification council that will work to reduce the regulatory burden and administrative costs for companies in order to free up more time for core business. 

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Artificial intelligence

One of the major themes of 2023 was the development and widespread adoption of AI. AI and machine learning have actually been part of our lives for a long time without us really reflecting on it, but with the developments in generative AI over the past year, interest in AI has completely exploded. For business owners in general, and small businesses in particular, developments in AI offer great opportunities for the future. Many administrative tasks that previously needed to be done manually can be automated with the help of AI, future projections will become more accurate and tasks that previously required external expertise will be able to be performed by the companies themselves in the future. As an entrepreneur, there is therefore value in starting to familiarize yourself with how AI could be used in your business to both free up time and contribute to increased growth. 

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Marketing

The conditions for successful marketing as an entrepreneur have improved significantly in recent years. You no longer need an agency, expensive equipment or a huge media budget to produce high-quality materials and get them distributed. Most entrepreneurs can now do their own marketing with the help of digital tools, a plan for what they want to achieve, and a continuous commitment of time. Marketing is also an area where generative AI can have the greatest impact for entrepreneurs as it will simplify everything from the production of text and visual material, to the development of plans and media investments. Something that will free up time that can instead be spent on analyzing trends and customer behavior in order to adapt marketing accordingly.

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Customer relations

As economic pressures are likely to ease and purchasing power in society increases, it also means that entrepreneurs will need to spend less of their time being reactive and can instead start to look ahead and be more long-term in their priorities. One area that is therefore likely to receive increased focus is trying to build strong and long-term customer relationships. Technological developments mean that it will be possible for smaller companies to offer tailored customer experiences in a way that previously only larger companies with extensive resources could do. AI will also make available more advanced data analytics that business owners can use to better understand their customers' behaviours and preferences, and thus develop more targeted, relevant and personalized offers. 

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Problems in supply chains, shortages of raw materials, and rising electricity and fuel prices have led to a troubled global economy, with rising inflation and interest rates. In these turbulent times, it is easy to feel uncertain, so in this article we offer tips on how you, as a business owner, can deal with the uncertainty.

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Price and cyclical sensitivity

The price and cyclical sensitivity of your industry is one of the first things you should consider as a business owner. Are you offering a product or service that customers will continue to use even if times get worse, or will you need to adapt your offer? The cyclical nature of your business will also affect how price-sensitive your customers might be in case you need to raise your prices due to increased costs. If you sell a product or service that your customers desperately need, they will be prepared to pay more for it. However, if you operate in a cyclical industry, price increases can have a major impact on your demand.

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Planning for the long term

During a recession, both society and the economy can become tense. In such situations, it is easy to become reactive if you do not have a long-term plan to follow. Making adjustments and ensuring your company's finances can withstand tougher times is of course important. Sooner or later, however, the economy will turn into a boom again and if you have only adapted your business to the current situation, there is a risk that your company will fall behind the competition. Having a long-term plan and having the courage to stick to it also reduces the risk of making hasty decisions that could backfire at a later date. By planning for the long term, you give your business the opportunity to grow and develop during tougher times, and to be well equipped to gear up even more when the economy picks up.

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Review your contracts

When interest rates and commodity prices go up, it's a good idea to review your contracts - both from suppliers and to customers - to avoid incurring increased costs while revenues decrease. Therefore, review your local and supplier contracts and see if you can tie them up for a period of time to avoid increasing their prices. Even if it would not be possible to lock in the contracts, it will give you an overview of the potential cost increases you might face, and you can then budget for them. Similarly, you should not lock in prices to your customers too much to give yourself the option to increase prices if your costs increase.

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Stocks and liquidity

As a business, it's always good to have strong liquidity to pay off debts in the short term. However, in times of recession, it is especially important to have a buffer in case you are hit by increased costs, which is why it is good to start planning how you can strengthen the liquidity of your business. Another tip is to review your possible inventory. If you have the opportunity, it might be a good time to stock up a little more than you normally would. This will ensure that you have access to products or components that may run out from your suppliers, as well as delaying the impact on your business of any price increases in the supply chain.

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Marketing

Many businesses choose to cut back on marketing during a recession when they cut costs in general. While reduced spending may look good in the short term, it doesn't necessarily mean it will benefit your business in the long run. Instead, if you choose to invest more in marketing when your competitors are cutting back, you have the opportunity to increase your sales and gain further market share. Something that will not only benefit your business for the moment, but also by giving you a head start when the economy turns up.

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Take the opportunity to adjust activities

When the economy in society is at its peak, it is easy to overlook things that are not really working or performing at the level intended. A recession can therefore be a time when it becomes easier to get rid of, or wind down, parts of your business that are slowing others down or are more trouble than they're worth. By doing so, you can have more time and resources to spend on parts of the business that generate better returns. It can also be a good opportunity to diversify the activities of your business to find new sources of income and to spread your risks.

Christmas is approaching, and for many businesses it means the busiest time of the year. By planning smart and acting in time, you can not only increase sales but also deal with challenges in a way that gives you and your business peace of mind. Here are some tips on how to prepare your business for Christmas in the best possible way.

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1. securing the warehouse

The increased demand of Christmas can quickly put pressure on stocks and logistics. Start with a thorough inventory of your products to identify what needs to be replenished. If you rely on imports, be aware that supply chains are often affected by holiday delays. Order goods well in advance and prioritize your best sellers.

• Analyze sales data from previous years to better predict demand.
• Use inventory management systems to optimize the flow.

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2. streamline invoicing

Invoicing can easily become a stress factor if left to the last minute, so act in advance. A clear invoicing plan will allow you to focus on driving sales during the Christmas period instead of dealing with financial administration.

• Review and follow up on outstanding invoices.
• Automate invoicing using digital tools to save time.
• Create clear payment terms for customers to minimize the risk of late payments.

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3. Build relationships with Christmas gifts for customers

Christmas is a great time to show appreciation for your customers. Recognizing your customers with Christmas gifts strengthens customer relationships and can also help promote your business.

• Promotional products with your logo, gift cards or personalized products.
• Consider sustainable or locally produced gifts to create a positive impression of your business.

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4. Plan for next year 

Christmas marks not only the end of one year, but also the start of a new one. By preparing for the year ahead now, you can go into next year with a clear strategy and less stress.

• Create a budget for the coming year and identify key investments.
• Make sure everything you need for January is in place, so you can start the year strong without delays.

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5. Reflect on the year's successes and challenges

Christmas is the perfect time to evaluate your business. Think about what has worked well and what needs to be adjusted to make it even better. Analyzing the past year will help you set realistic goals for the future, and a concrete plan will give you a clear direction that motivates both you and your team to reach new heights.

• Create a list of success factors and areas for improvement.
• Set measurable sales, customer satisfaction and development targets for the next year.

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6. Prioritize recovery

The holidays can be hectic, but it's important that you as a business owner also take care of yourself. By planning and preparing well in advance, you can free up time for family time and rest.

• Delegate tasks where possible and automate processes that save time.
• Try to make time for recovery so that you can enter the new year full of energy.

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Executive summary

Preparing your business for Christmas involves a combination of planning and consideration for both your business and your customers. By following these steps, you can ensure that you and your business are ready to deal with the opportunities and challenges of the festive season - while making time to enjoy Christmas. Need help financing an investment for Christmas? At Froda, you can access financing tailored to your business needs.

Managing stock is not an easy task for small business owners. Trends come and go, and you've probably had a whole bunch of products in a certain color or size that you've had to clear out because they simply weren't being used. But it's also common for companies to lose track of their stock because their inventory can't quite keep up. However, there are ways to overcome this and get the most out of your stock and therefore your investment in your business.

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Create a procedure for the inventory

Inventory costs money for your business and is a major investment. So it's a shame if you don't get the most out of what you've bought because of the inventory. Taking stock means creating a record of the goods in your company's warehouse. The most common practice is to take stock once a year and if you have a warehouse or inventory system, each item only needs to be inventoried once. If you have a smaller stock, it is easier to keep track of the products and it is important to do so because you can adjust what you order to what you already have. For example, if you notice that certain items aren't being used as quickly, you won't need to order as much of them next time.

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Keep track of trends

An important part when it comes to inventory is to try to avoid tying up too much money in it because the risk of buying things that don't sell is that you have to sell them out later, or in the worst case, don't get them sold at all. By keeping an eye on the different trends in your market, you can reduce this risk as you can control what you order based on what is likely to sell the most.

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Ask customers what they want

Another tactic to avoid filling your warehouse with unnecessary products is to ask your customers what they want. You can do this in a few different ways. If you have a physical store, you can ask customers at the checkout. This is an effective way to gauge demand. If you have an online shop, you can choose to ask the question at some point in the checkout process on the website, or you can email the customer afterwards.

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Look back and learn from it

You can also learn from your own history. If you look back at orders and purchases, you can quickly see different patterns. For example, many products are seasonal, meaning they are used more or less during different seasons. You'll know if you need to stock up on something for winter and when you can reduce your order.

When you take out a loan, the interest rate is the cost you pay the lender for lending you money and is often the most decisive factor when it comes to choosing a lender. Below, we clarify what you as an entrepreneur should consider to navigate the interest rate jungle.

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Access to financing is a prerequisite for companies to be able to invest. And just as an entrepreneur should calculate what return an investment may bring, they should also be aware of the exact total cost of an external financing solution. This way, they can make the most informed investment decision possible and thus give the company the right conditions to grow.

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When you, as a business owner, take out a loan with Froda, the interest rate is the only cost for the loan. Unfortunately, this isn't the case with all actors in the business loan industry. Unlike the market for consumer loans and credits – where it is clearly regulated how the total price of a loan should be presented – there is a lack of both regulation and a standard for how the price is presented when it comes to business credits. Therefore, it is important for business owners to be aware of interest rates and how different ways of presenting them will affect the total cost of the loan, in order to compare different offers and choose the most advantageous option.

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What is interest?

Interest is the cost you pay a lender for lending you money. Usually, the interest is expressed as a percentage of the loan amount, but in business loans it is also common for it to be stated as a fixed cost.

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Differences in various types of amortizations

Depending on the type of amortization the loan has, the interest payments may differ with each payment. With an interest-only loan, you pay ongoing interest on the loan amount, and the sum of each interest payment only changes if you choose to amortize the loan or if the interest rate changes (the latter only applies if the loan has a variable interest rate). However, for business loans, the most common is that the loan either has straight-line amortization or is an annuity loan. With straight-line amortization, you amortize a given sum at each amortization opportunity, while the interest portion decreases as the debt decreases, whereby the expenses for the loan also decrease over time. With an annuity loan, you instead pay a given sum at each payment during the loan's term. In the beginning, the interest portion therefore constitutes a larger part of the expense for the loan but decreases over time as the amortization share increases.

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Nominal interest rate vs. effective interest rate

The nominal interest rate indicates the interest rate at which the lender issues the loan and is what we usually refer to in everyday speech when we talk about interest and the interest rate that is stated in the agreement. The effective interest rate, on the other hand, shows what the actual cost is for a loan – as it also includes any additional fees associated with the loan and how often you pay it off – and is the figure you should look at when comparing different offers. For consumer loans, the effective interest rate must always be clearly stated and exemplified in the marketing in accordance with the Consumer Credit Act. There is no such regulation when it comes to business loans, which is why it is often more difficult to compare different offers as it is difficult to know what the actual cost will be. Since Froda does not charge any set-up fees, invoice fees, or other hidden fees, you as a business owner can be confident that the only thing that affects the effective interest rate from the nominal interest rate we present is how often you choose to amortize your loan.

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Annual interest rate vs. monthly interest rate

Usually, when presenting the nominal interest rate, it is done as an annual interest rate, that is, the percentage interest rate for the loan per year. This means that the interest cost is based on calculating it from the outstanding debt at the beginning of the year. Just as when it comes to presenting the effective interest rate, the annual interest rate is well-established when it comes to consumer loans, as this is also regulated in the Consumer Credit Act. However, as regulation is lacking when it comes to business loans, many actors instead choose to present the interest rate as a monthly interest rate. However, many actors present the monthly interest rate in an incorrect way by dividing the average monthly cost by the original loan amount, instead of dividing it by the average loan amount during the year. Something that makes the monthly interest rate appear half as large as it actually is.

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When considering an offer with a monthly interest rate, it is therefore important to calculate whether the interest rate presented is really a correct monthly interest rate, or whether it is the average monthly cost expressed as a percentage. A simple way to check this is to take the average interest cost for the loan's first twelve months and divide that figure by the original loan amount. If the figure you arrive at corresponds to the percentage presented as the monthly interest rate in the offer, it means that the actual interest rate is actually twice as high. If it is instead half as large, the presented monthly interest rate is correct, and you can then convert the monthly interest rate to an annual interest rate by multiplying the interest rate for the monthly interest rate by twelve. In this way, it becomes easier to compare different offers and get a clearer picture of what the loan will actually cost you and your company.

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Interest on outstanding capital vs. original loan amount

When discussing interest rates, it's generally understood that the interest is calculated on the outstanding capital, and the interest payments decrease as the debt decreases. This applies whether the loan is interest-only, has straight-line amortization, or is an annuity. However, in business loans, some lenders may choose to talk about a fee instead of interest linked to the loan, and that fee remains constant throughout the loan term. Using a fixed interest fee for each repayment means that the cost of the loan in relation to the total debt increases each month, i.e., the percentage interest rate becomes higher over the loan's term. This in itself is not a problem, but some lenders choose to incorrectly present the initial interest cost, expressed as a percentage of the total loan amount, as the loan's interest rate. This is problematic because it makes the interest rate – similar to how some incorrectly present the monthly interest rate – appear much lower than it actually is. If you receive an offer with a fixed fee, it's therefore important to verify that the interest cost relative to the original loan amount is not expressed as the percentage interest rate for the loan, and to compile the total interest cost for the loan over its entire term, in order to compare it with offers that apply interest to the outstanding capital.

Black Friday has emerged as one of the most important sales days in Sweden and globally. As a retailer, it is therefore important to be prepared to maximize the opportunities. We've put together some tips for both physical stores and online retailers to maximize your sales.

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Strategies for physical stores

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Focus on upselling

Increase the customer's average purchase through upselling techniques, such as those used by McDonald's, where the customer is asked to add items that match the one they have already chosen. 

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Offer free products

Create promotions where customers who reach certain amounts get specific goods for free. This motivates customers to spend more to reach these levels.‍

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Focus on best sellers or clear stock

Customize your offers based on whether you want to attract new customers or reduce surplus stock. Strategic pricing on popular products or surplus goods can generate both sales and customer interest.‍

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Create in-store events

Organize special in-store activities to create a unique shopping experience. Small snacks and interactions with customers can increase footfall, which in turn increases the likelihood of higher sales.

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Strategies for e-commerce

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Free shipping

Offering free shipping can increase conversion rates, especially for smaller purchases where the cost of shipping can otherwise be a deterrent. Another way to get customers to spend more is to condition free shipping on spending over a certain amount.

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Exclusive offers for subscribers

Reward loyal customers and newsletter subscribers with special discount codes to thank them for their commitment or priority access to Black Friday offers. The latter is an easy way to create a sense of urgency among your customers, to get them to make their purchases earlier. Promoting that subscribers receive special offers is also an effective way to increase the number of people your email marketing reaches.

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Optimizing website performance

Make sure your e-commerce platform is robust enough to handle high volumes of visitors and that technical support is ready to deal with any issues that arise.

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Strengthen customer service

Increase staffing levels or extend customer service opening hours during Black Friday to quickly address customer questions and concerns.

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By implementing these tips, you can improve both the customer experience and your sales during Black Friday. Good luck optimizing your marketing strategy for maximum impact!

Access to finance is a crucial factor for businesses to drive growth, innovation and, in some cases, survival. For entrepreneurs, the world of financing options can seem both complex and overwhelming.

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Whether it's to start a new business, expand your business, or take on temporary financial challenges, it's important to understand the different funding options available.

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Each form of financing has advantages and disadvantages, and what is best for your business will depend on factors such as your company's size, industry, growth phase, and specific needs. It is also important to understand the financial implications of different forms of financing - interest rates, repayment requirements, possible collateral, and how these may affect your company's cash flow and finances in the long term.

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In this guide, you can read about the most common forms of financing that businesses can use, provide insights into how they work, and hopefully help you decide which one is best for your company's unique needs and goals.

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Traditional bank loans

Traditional bank loans are one of the most established methods of business financing. Banks provide security and often offer low interest rates and favorable terms, making them an advantageous choice for long-term investments such as business growth or major purchases. However, the process of applying for a bank loan can be time-consuming and requires extensive documentation, including business plans and financial statements. They also tend not to lend to smaller businesses as these do not generate enough returns for the bank and are considered too high risk, so bank loans are not an option for the vast majority of businesses. However, for companies with a strong credit rating and a firmly established business model that can access a bank loan, it can be a cost-effective option for financing.

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Digital actors

Technological developments have led to the emergence of a number of digital players focused on financing all the businesses that banks do not lend to, such as Froda. These companies have built processes and credit models tailored to small businesses, allowing them to offer access to finance both faster and with less bureaucracy than traditional banks. Digital players are often characterized by user-friendly interfaces, fast approval processes and disbursements, making them an attractive option for businesses in need of financing.

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Overdraft facility

Overdrafts, also known as business credit or overdrafts, are a flexible solution that allows businesses to access finance up to a predetermined limit. It is particularly useful for dealing with unforeseen expenses or short-term liquidity problems. Repayment is usually flexible and interest is calculated only on the amount drawn down.

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Factoring

For businesses with long customer payment terms, factoring can be an option to improve cash flow. Factoring is a financing method where companies sell their outstanding invoices to a third party at a discounted price to get paid directly. Factoring allows companies to quickly convert invoices into cash, enabling more efficient capital management and the ability to react quickly to business opportunities.

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Leasing

For businesses that want to avoid tying up too much capital, leasing can be an effective way of financing the company. Through leasing agreements, businesses rent equipment for an agreed period instead of buying it. This way, businesses can have access to the latest equipment without the large upfront cost associated with buying. In addition, leases can often be tailored to suit a company's specific needs and budget, making it a flexible option for small to medium-sized businesses.

How does Froda affect the key interest rate?

Froda finances its lending to companies with deposits from the public through our savings accounts. The deposit rate that Froda offers for the savings accounts is affected by the current interest rate and market situation. Due to the increase in the key interest rate, we have therefore had to increase the interest rates for our savings accounts. However, the increase in the deposit rate has led to a sharp increase in our funding costs in recent years.

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Why have you raised the savings rate?

Lending money to businesses requires that we have money available to lend. To be able to do this, our savings accounts must have a competitive interest rate compared with the rest of the market for savings accounts in Sweden. As the increase in the key interest rate has led to an increase in the general level of interest rates for savings accounts in Sweden in recent years, we have needed to raise our savings rates in order to continue to have money available to lend to companies.

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Will it affect the interest rate on my business loan?

As far as possible, we will endeavor not to increase the interest rates on loans already issued. However, due to the increased cost of deposits, we may need to adjust the interest rate for a small number of customers in accordance with paragraph 4 of the general terms and conditions of the loan agreement. We will do this to ensure that we can continue to offer the same service as before.

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If so, how will this affect my refund?

In the event of an interest rate increase, each loan will be affected individually. By logging in to My Pages, you can see your new interest rate and how it will affect your repayment. On My Pages, you can also see if you have the option to change your repayment period in case you want to adjust the cost of each repayment.

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Could you raise interest rates several times?

Whether or not we might make multiple price adjustments depends on the development of the policy rate and the general interest rate environment.

Opportunity cost is a term often used in economics. But what does it really mean? And why is it good to know about it when running a business?

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As an entrepreneur, you are faced with various choices and priorities on a daily basis, big and small, and for every choice you make, something else has to take a back seat. It doesn't have to be that you actively choose one of several options, but your resources are not infinite. Therefore, every resource used in a certain way means that the same resource cannot be used in another way. And this is where opportunity cost comes in. This is because opportunity cost describes the lost revenue, or value, of the alternative that was chosen.

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There is therefore much to gain from learning about opportunity cost. Because taking it into account in decision-making will lead you to make more informed decisions that benefit your business the most. When you invest time, money or other resources in one part of your business, you indirectly opt out of other potential investments. Considering what is being sacrificed will allow you to make more informed decisions that maximize the use of resources and have the greatest impact for the company both in the long and short term.

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Using opportunity cost in decision making

Once you understand what opportunity cost means, you should take it into account when making decisions about your business. Consider all the options before making your decisions and understand what you will give up if you choose each option. By doing so, you can better analyze the different options, estimate the value of your resources and prioritize the one with the highest return.

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When it comes to different investments, opportunity cost can come into play in different ways depending on whether it is a question of an either-or decision or whether it is about how to allocate a resource. Let's say, for example, you are going to buy a machine and you are choosing between two options. Option 1 is cheaper, but option 2 has a higher capacity and can therefore produce more. In simple terms, the opportunity cost if you choose option 1 is the loss in production that option 2 would have given, which would then have led to you being able to sell more. If you had chosen option 2 instead, it would have meant that you had to spend more money initially and thus prioritize something else. The opportunity cost of option 2 would then have been what you could have used the difference for if you had chosen option 1 instead. So here it becomes a trade-off to see which choice would have given the greatest return seen as a whole.

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Opportunity cost thinking can also help you prioritize and value your time better as an entrepreneur. A clear example is the question of managing finances yourself or hiring someone. Hiring someone costs money, but doing it yourself means you need to spend time on it. You then need to sacrifice time that you could have spent on things that generate revenue. You can either save time or money and the trade-off is whether or not the revenue you would have generated in the time you saved would exceed the cost of getting help. A further example is whether to prioritize between different ventures and problems. You may have four different things you are able to accomplish in a given period of time. Three of them require less resource use while one requires more, and you need to choose between doing either the three smaller ones or the larger one. In this situation, it is easy to tackle the smaller tasks as they are likely to have a shorter start-up time and it feels good to get things done. But if all three smaller efforts together have less effect than one larger one, it is a waste of resources to prioritize them instead of the larger one.

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Opportunity cost and financing

Have you ever considered whether you should save up for an investment or take out a business loan and make the investment here and now? Or have you thought about whether to increase your purchases but are afraid of putting too much strain on your cash flow? In both cases, the opportunity cost would help you make the most optimal decision. If you save up for an investment instead of using finance, you certainly save on the cost of interest. But if you had made the investment using finance, you would have received a return on it sooner. If you save up for it, the opportunity cost will therefore be the forgone return until you make the investment. If the opportunity cost is higher than the interest cost of the business loan, your business would have benefited from using finance. The question of financing major purchases works in a similar way. If the potential profit you can generate from making larger purchases, i.e. the opportunity cost of not doing so, is higher than the cost of the financing, then making larger purchases using financing is optimal.

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The long-term effect

Using opportunity cost allows you to make more informed decisions that maximize your company's resources and generate the highest possible returns. As a result, you'll be better able to identify potentially profitable opportunities, navigate change, and not cling to sub-optimal strategies. Overall, you will become better at planning for the future, setting realistic goals and developing strategies that leverage your company's strengths and capitalize on market opportunities. This will lead to you being more successful in your business.

To go deeper into the view of entrepreneurship and get answers to why some take the step to start their own business, while others stop at dreaming about it, Froda has produced the report Driv.

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In the report, we have also examined the driving forces and challenges associated with entrepreneurship in order to identify the factors underlying demographic and geographical differences in entrepreneurship in Sweden. Through a deeper understanding of entrepreneurship in general, as well as the people behind it, we hope to create better conditions for both today's and tomorrow's entrepreneurs.

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The entrepreneurial dream is widespread

Six percent of the population currently run a business and every second Swede has at some point thought about becoming an entrepreneur. Among the younger age groups, the figure is even higher. Two out of three under 30 say they have considered starting a business.

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Self-determination is the strongest driver

The possibility of self-determination is seen as the most attractive aspect of entrepreneurship. Both entrepreneurs and Swedes are driven by being able to work on what they want, plan their own time and be their own boss.

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More than one in two Swedes have business dreams. This corresponds to over 4 million potential entrepreneurs in Sweden.

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Sweden's entrepreneurs in figures

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Two out of three under 30 want to become entrepreneurs

The dream of entrepreneurship is stronger the younger you are. Today, only one in twenty entrepreneurs is under the age of 30, while a third is 65 or older. However, two thirds of Sweden's 16-29 year olds have considered starting a business, a figure that is twice as high as the proportion of people over 65 who have considered becoming an entrepreneur.

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Gender equality remains a challenge

Only one third of Sweden's entrepreneurs are women. Women are also less likely than men to say that they have considered starting their own business.

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Entrepreneurship big and small

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Money is a challenge

More than four out of ten Swedes would start a business if money was not an issue, and the impact of money is once again evident in the challenges of entrepreneurship. The most common concern for entrepreneurs at the start was how their own personal finances would be affected.

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Large differences in entrepreneurship between Sweden's counties. Read more about them in the report
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Women and young people held back by lack of funding and confidence

In the youngest age group, concerns were more pronounced in several areas: difficulty in obtaining finance (18%), fear of failure (29%), legal issues (16%), business idea not working (23%), etc.

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Women are more likely than men to consider lack of knowledge about entrepreneurship (34%), access to finance (38%) and fear of failure (41%) as the main obstacles.

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Foreign-born people are enterprising

Only just over one in six entrepreneurs in Sweden is foreign-born, and three out of four entrepreneurs are born in Sweden with two parents born in Sweden.
However, 5 percent of all foreign-born people in Sweden are entrepreneurs, which is just below the national average of 6 percent. Among those born in Sweden with two parents born in Sweden, 7 percent are entrepreneurs.

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However, when it comes to women, foreign-born women are more entrepreneurial. There is a higher proportion of women among the foreign-born entrepreneurs compared to the native-born entrepreneurs with two native-born parents (35% vs. 31%).

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Press contact

Johanna Sturk
PR & Communications Manager, Froda

johanna.sturk@froda.se
0729414216

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Methodology

The DRIV report is published by Froda, and is based on Statistics Sweden's register-based labor market statistics (RAMS) in 2021 and a survey via Norstat's nationally representative web panel that includes 6,511 respondents. The survey was conducted in February 2023.

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This compilation is based on statistics from Statistics Sweden on 1. Swedish entrepreneurs aged 16+ and 2. the Swedish general public aged 16+ and 3. a self-initiated survey of the Swedish general public aged 16+ (see below for a description of the survey).

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Consignor

The sender of the report is Froda, a credit institution that promotes gender equality and inclusiveness in business by promoting objective and digital business finance on good terms. Froda's goal is to give all SMEs the same opportunities to succeed, regardless of the founder's age, gender or ethnicity.