Companies use leverage when trying to achieve a higher return on their assets and should understand the concepts of operating and financial leverage. However, leverage is not a guarantee of success because excessive losses are possible when using too much leverage in business. Leverage is used as a source of financing when investing to increase a company’s assets and generate returns on venture capital; it is an investment strategy. Leverage may also relate to the amount of debt that an enterprise uses to finance assets. When a company is said to be heavily influenced, the company has more debt than capital. Financial leverage arises when a company decides to finance most of its assets by taking on debt. Companies do this when they are unable to raise enough capital by issuing shares in the market to meet their business needs. When a company needs capital, it will look for loans, credit lines and other financing options. When a company borrows, that debt becomes a liability in its books and the company pays interest on that debt. The company will be justified in borrowing only if it believes that the return on capital (ROE) will be higher than the interest on the loan. The paper analyzes possible approaches to the analysis of the opportunity to use leverage and the best approach is the one that excludes the influence of suppliers. After that, the analysis for specific data was applied to the company Arena Hospitality Društvo d.d. in the period 2015.-2019. The analysis proved that in the stated period, regardless of the results of calculations and high interest on borrowed money, the Company justifiably used the financial leverege, which is in the paper and argued by the data from the financial report of the company.