Another year of financing challenges

Small businesses will be faced with the credit crunch for yet another year according to published reports. Banks and lenders slowly continue to re-build their balance sheets although few are making any new substantial loans.


Many say we are suffering from the fastest ever shrinkage in commercail lending for small businesses and there's little if any sign of it coming to an end. Small businesses are dependant on local banks relying on them for capital, financing and lines of credit.


Until big bank finances are healthy small businesses will face challenges for financing. Alternative financing sources such as factors, venture capital groups and asset based lenders are the best bet in the short term for small business finance.

Small businesses turn to alternative funding sources for help.

Small businesses, particularly start-ups are turning to non-traditional financing sources to solve cash flow problems in their businesses and fund growth opportunities.


Many small businesses have been turned away from traditional lenders and are discouraged by the overall finance communities response to their needs. As a result many are seeking other avenues such as family members, equity partners short term investors, asset based lenders and factoring firms.


Credit is a problem for most small businesses, slowing down their ability to grow or stopping them all together. Patricularly now when institutions have revised their lending requirements and made obtaining new creidt more difficult business are looking for more creative ways to fund growth.


Be careful though. Many private investors want at least 25% ownership in a venture and banks want to secure loans with personal tangible assets.

Big gains for small business in Dallas-Fort Worth

According to the Dallas Business Journal loans from the U.S. Small Business Admisistration have increased 84 percent in recent months. This increase is due to an improving economy, lenders who are able to lend and entrepreneurs who are taking risks.


The trend is expected to continue in 2010 and could be one of the best years every for small business lending and finance in Dallas - Fort Worth.


While SBA guaranteed loans are not a sure thing, business owners that are looking to grow their business should be aware these loans are out there but may take some time and effort to get.


For more information on the SBA loan programs you may visit http://www.sba.gov/ or a local participating lender.

SBA to help small business owners grow their business.

Many small business owners have been looking for growth capital and lines of credit to help their business grow during the past several months. Most lenders however, have been reluctant to make small business loans due to the uncertain market. As a result, many business have sought other financing sources for their business needs.


Well... there is good news for small businesses as some may benefit from a Small Business Administration loan. During the past several months new government legislation has allowed the SBA to guarantee a higher percentage of loans. These loans originate from a typical lender but are guaranteed by the Small Business Administration.


Althought the higer percentage may only be a temporary fix, there are SBA loans available from a variety of banks .

Consult your local SBA office for more details or look for lenders in your community to see what SBA programs they may be offering

Cash under the mattress?

A recent study conducted by Brother International asked 500 business owners what they thought about the current economic conditions. Of the 500 surveyed 53% said stockpiling cash was the best strategy for getting their business through the tough economic conditions. While this theory may not work for everyone having ready cash reserves is always a good idea.

Efficiency is also a concern with most surveyed saying they will strive to make their companies more efficient this year. Cutting costs whereever possible and holding off on those large expendetures may be a necessary way of reaching this efficiency.

Planning of course is the key to running any business. While most companies do utilitze a business plan certain circumstances make sticking to it difficult. The current economic situation is a good example. Whatever the current climate always try to at the very least prepare yourself with a financing plan. There are a number of alternative financing opportunities for businesses like SBA loans, asset based loans, and invoice factoring to name a few. While having a little cash under the mattress can't hurt, these other sources of financing might be a safer bet.

Advice for Small Business

What makes a small business successful? The list is long and each business owner has his or her own formula for success. Here are a few tips for just about any business:

1. Treat people as you wish to be treated - This does open doors and has its own psychological rewards.

2. Make sure to match your strengths with the right opportunity - Don't venture into a field in which you have limited experience.

3. Systems and procedures - No matter how profitable a business or how hard you have worked if you don't have the right systems, equipment and procedures in place your business can be reduced to virtually nothing over night. Invest in a website, equipment and professional consultants. It's money well spent.

4. Plan for a rainy day - Business will have its ups and downs, you can count on that. But if you have a strategy to deal with problems they are more easily handled as they happen. Work the solutions and learn from the results.

5. Have a long term plan - Know where you want to be and when and plan for it. Arrange financing whether it be with a bank, venture capital company, factoring company or other. Financing is vital to the success of a growing business.

6. Employ the right people - Find the right people for your business and tap into their talents. Employees are an asset for any business and finding the right ones can be a challenge.

Light at the end of the tunnel?

American City Business Journals show small businesses are feeling better about their future.


While most agree the economy has a long way to go, there does seem to be a more optomistic approach and an eagerness to succeed. Small businesses are most concerned about the cost of health insurance and employee benefits. Banking and finance came in second and unemployment came in third.


With the economy and finance a heavy burden for business owners, making sound business decisions is a must. From finding the right financing partner to when and how to grow a business are some of the biggest concerns facing businesses. Local Small Business Development Centers are an excellent outlet for advice. They can advise you on almost every business need. But make sure to explore all your options first and factor in all the risks to make sure the decision is right for you. To read more about the Small Business Development Center visit them at: http://www.ntsbdc.org/.

Getting and keeping a small business

Millions of people dream of owning there own business. Being in control of your own future has great advantages but there are some factors you should consider first.

1. Find a business expert or group of experts that work with start-up and growing companies. They can provide you with education and counseling on the smallest of details when starting or gowing a business.

2. Ask your banker for advice on financing. If he can't help you he may refer you to other resources such as factoring companies or asset based lending firms to help you build your business or at least help with financing solutions.

3. Establish a sound track record with your business. A good credit history is as just as important in business as in personal finance. Make timely payments to suppliers and vendors and take advantage of trade discounts . Ultimately this will pay off when applying for future loans.

4. Be patient. It takes time to establish a solid business and get everything running smoothly.

Despite rumors of an economic recovery businesses continue to find little financing with which to run their companies. This coupled with mis-management or lack of adequate cash flow are the most common reasons for failure.

Consider factoring...
This is one of the best ways to regulate your cash flow and get through the rough times. Factoring can provide you with up to 90% of the value of the invoice and keep your suppliers paid, taxes up to date and employees paid. Factoring programs vary and many will allow you to tailor a program for your comapny's specific needs. Finds one that's right for you today.

Factoring.... the cash of tomorrow

Eighteen months after the almost collapse of the US financaial system we still can't agree on how to fix the problem. Companies continue to fail because little if any financing is available to them especially for growth. Companies who did have financing are now likely to loose it because institutions are cutting back lending dramatically.

So what is a business owner who still needs cash to run his business to do? Believe it or not there are some alternatives. Accounts receivable financing or factoring has become a viable source of financing for all types of businesses. Businesses now take advantage of an immediate steady stream of cash for their business. Factoring companies programs vary in services and price but there is almost certainly one for everyone.

Cash is king

Many small business owners think a good cash base is the way to offset some of the effects of a recovering economy. One good way to create this cash is by increasing a company's cash flow by factoring.

Factoring has become increasingly popular these days among all types of businesses and for good reason. It's fast, dependable and easy to manage. For a small fee a company can get their money up front rather waiting for their customers to pay. Factoring programs differ from institution to institution but for the most part work off an advance and reserve type system. What this means is a percentage of the invoice is paid up front and the balance or reserve less the factor's fee is paid when the factoing company is paid.

So if cash is king for you factoring could be a good option.

From unemployed to hired.

More and more employers are relying on temporary and contract workers these days. According to the Bureau of Labor and Statistics over 166,000 jobs have been added to payrolls since the summer of 2009. Although many companies have cut their workforces to esential personnel only, the long term use of temporary personnel allows employers flexability during tough economic times.

So if you're in need of employment this might be the route for you!