Things to consider before taking a loan to finance a business

1. Will the business be able to generate the cash flows to pay back the loan?

This is the core consideration. You should be sure that the business will not only manage to pay it back, but also have money left for operations and meet your profit targets. You want to make profits, so the business has to first of all generate enough cash flows to pay off the loan. Once you pay the loan you still have operating costs. Once you pay those, will you still be able to make a profit? The worst case scenario should be that you will pay off the loan and pay the operating costs, but you should be able to make some profit.