Funding To Expand Stalling Businesses

The most successful small businesses are always looking with confidence into the future.  If you have a slowing business in a growth industry such as retail, construction, manufacturing, or agriculture; it may be time to do some internal soul searching.   Ask yourself, “Why is your business slowing down or not growing?”

Business Growing Pain

When you first start open your business; enthusiasm, passion, energy, etc. all all at their absolute peak.  Your business plan is still fresh, your invested capital is having it’s initial impact, and all of your team has dived head first into a new venture.  And those these days are most certainly contained the longest hours and the lowest compensation, they are often the most rewarding as you can finally see your initial vision being realized.

After fighting through this infancy stage, satisfaction usually gives way to lethargy or complacency.  It is common for this to happen when a business reaches the high six figure to low seven figure marks in revenue.  This is really the mark when a business and a business owner are tested.  They can either contract, stand still, or take it to the next level.

Taking Personal Inventory

Every business owner must ask himself tough questions at key moments in the lifespan of his or her business.  Am I doing something wrong?   Am I meeting my customers needs?  Can I capture more market share?  Am I keeping up with the competition?  Am I loosing market share that I should otherwise be getting?  Am I satisfied with the level of awareness of my company in the market place?  Are we equipped to handle the demand we have based on our current capacity.  These questions are essential in determining a businesses prospects for the future.  They must be looked at clearly and analytically and the conclusions drawn from asking these questions need to be acted upon by the responsible businessman or woman looking to maximize their businesses potential.

Expand or Die

Businesses are like sharks.  They either keep moving or they die a slow death.  The best way to break out of the lethargy stage described above is by expanding.  By expanding; whether it be opening a new branch or location, increasing production capacity, adding new products or services, or exploring all new verticals; an existing business can rediscover the drive, energy, and innovation that created it in the first place.  These less tangible benefits can be reaped while at the same time creating the tangible benefits of expanding into new markets, increasing market share, and exploring ancillary markets.  All of this leading to increased sales and profits.  All of this sounds great, I’m sure.  The question is how?  Obviously the biggest obstacle to this type of expansion is capital resources required to make such a move.

Funding Your Expansion

If your business is like most businesses, you may find it difficult to self- finance any significant form of expansion.  In this case, a business loan is the obvious solution.  Prior to applying for  a business loan of any type, any business owner would need to do a detailed analysis of the needs of it’s business to make sure that the financing acquired fit that particular businesses present needs and objectives for the future.  This must also be weighed against the benefits of the expansion to make the best determination on how to move forward.  You have to make sure that expanding your business is going to benefit the bottom line.   It is also imperative to determine if the financing available can be acquired at a cost that the business can handle and if there will be an effect on current production during this expansion phase.

Obtaining a Business Loan

The first option most businesses consider when seeking funds for expansion is obviously a business loan.  There are obviously countless banks and credit unions that offer business loans.  Unfortunately, the vast majority of them suffer from tight money policies.  Even if a business meets their criteria the process can be extremely lengthy and very frustrating for businesses.  We are talking about weeks, and sometimes even months just to get all of the documentation in order.  This can bureaucratic process can go a long way in diminishing the excitement and energy of the business owner in regards to the expansion.  Because of this a lot of business owners are forced to seek alternative means to acquire funding for their expansion.

Business Loan Alternatives

A merchant cash advance is an alternative that more and more businesses are turning to to make their expansion dreams come true.  This type of funding is not only faster, but requires a great deal less documentation and red tape to receive.  In addition, this type of funding is based upon the company’s revenue as opposed to the business owner’s personal credit.  This means that in a lot of cases the projected revenue of the expansion can be taken into account, allowing the business to receive a larger amount from the advance than would otherwise be possible.  Repayment may also be made easier because the money can be obtained in a timely fashion and used strategically to take advantage of the time when the expansion will have the most impact.  In business, timing is everything, and it is important to strike while the iron is hot.  If you expand at a less than opportune time because of waiting for the needed funds you can cost yourself a lot of the money and benefits that would have otherwise be accrued.

Conclusion

Business growth is business health, so it’s not a matter to be taken casually.  Standing pat will not cut it.  Because while you’re standing still, someone is approaching in the rear view mirror.  And guess what, they are armed to the teeth will all the vigor, energy, enthusiasm, and ideas, that served you so well in the beginning.  When you see them getting ever so closer, or see yourself falling ever so farther behind, a merchant cash advance might be just the booster you need to turbo charge your business and put it into overdrive.  This may be a tough decision to make, but it’s one that you could look back on the key in getting your business out of stasis mode and up to that next level that you always dreamed about in the first place.  That dream does not have to be deferred with the alternative sources of funding now available, it has never been easier for and existing to reach the heights of it’s full potential.  Grab the bull by the horns and best of luck to all the great entrepreneurs in our midst.  Your dreams, hard work, risk taking, ingenuity, sacrifice, and good old fashioned hustle are what truly make this economy go and help this country shine ever so brightly.

 

Tax Credits Businesses Looking For Loans Should Take Advantage Of

The one thing that all businesses must deal with is taxes.  There is no question about their inevitability.  Before a business owner looks to obtain funding it wise to make make sure that there is a comprehensive understanding of the tax credits available to take advantage of.   Unlike tax deductions, most business owners are unaware of the various tax credits available to them.  Having this understanding provides more insight which would hopefully lead to making well informed decisions on what type of funding to seek and how it would effect the overall bottom line. Each and every penny that a business can obtain via a tax credit is adding to that businesses bottom line.  Below we will go over some of the tax credits currently available for businesses.

Employer Provided Child Care Tax Credit

If you’re a business that pays directly for the child care cost of  your employees, you can qualify for this tax credit.  The value of the credit amounts to twenty five percent of the childcare facility cost.  A business can get up to $150,000 for each employee.  Another advantage is that if the company is properly incorporated and the owner’s partner is also an employee, they too can qualify for this tax credit.

Work Opportunity Tax Credit

The Work Opportunity Tax Credit is available for employees who hire people from certain target groups.  These groups include Unemployed Veterans, Food Stamp Recipients, Ex-Felons, Qualified Long- Term Unemployment Recipients, Temporary Assistance for Needy Family Recipients,  Summer Youth Employees, Vocational Rehabilitation Referred Individuals, Supplemental Security Income Recipients, and Designated Community Residents.  A company will receive a credit that is about forty percent of the workers first year salary.  This credit maxes out at $6000.00/$9600 for a disabled veteran hire.

Business Health Credit

If  a company pays the health insurance premiums for it’s employees, it can qualify for a credit for up to fifty percent of that cost.  This credit is available for eligible employers for two tax years that run consecutively.   The health plans must qualify under the Small Business Health Options Program marketplace.

Research Tax Credit

A business can use qualified research expenses that are more than fifty percent of it’s average for the three prior years.  This is a credit that goes up to twenty percent of a businesses expense for qualified research.

Qualified Research Expense Credit

This credit is meant to incentivize businesses to participate in research and development.  It can provide a company with very tax large savings. The definition of the QREC is broad but involves a number of different activities. This can be developing new or improving old formulas, products, prototypes, models etc.  Building or improving facilities, developing new technology, environmental testing, certification testing and more.   QREC calculations can be complex.

Welfare To Work Expenses Credit

This credit is available to companies that hire employees who have historically face difficult barriers to employment. These barriers can include;  lack of transportation or education, child-care needs, disabilities and more. The amount of the credit is based on the wages paid to the employees. This credit maxes out at $9,000 over a two-year period.

Disabled Access Credit

This particular tax credit is available to businesses that renovate its premises to make it more accommodating to people with disabilities. These renovations must meet the standard set forth by the Americans with Disabilities Act (ADA) A small business that qualifies for this credit must have gross revenue under a million dollars, and employ less than 30 full-time employees during the tax year. This credit is good for 50 percent of the initial $10,000 of eligible expenses associated with the renovation. The credit maxes out at $5,000.

Conclusion

In the end, it is a good idea to check into these credits and see how they may help your bottom line.  In a perfect world it might serve as an alternative source of business funding that you were not even aware of.  It’s money you have a right too.   And it cost you nothing.

 

How To Get A Business Loan With Bad Credit

%Better Business Funding %Small Business Loans

 

The lifeblood of any business is capital.  Many businesses fail because of under capitalization.    In this era of tight credit a viable business with solid revenues and great potential may not be able to reach that critical mass to take it over the hump.  Business owners struggle with this reality every day.

The Challenge of Poor Credit For Business Owners

Anyone that been in trenches of running a small business knows full well that sometimes your credit can get compromised because of tough circumstances and tough choices that have to be made to survive those circumstances.  The fact that someone is not always able to maintain a perfect FICO score is not an indictment on their abilities as a business owner or the value of their business.  Unfortunately, traditional banks don’t view things this way.  There size and structure don’t allow it.  When you’re dealing with the massive bureaucracy of a corporate bank there is no room for nuance or judgement.  Decisions are not made by individuals who can weigh a multitude of factors.  Decisions are made using algorithms.  Even local banks have shifted more towards this model of funding if you have not established a long and steady relationship with them.  Fortunately, nature abhors a vacuum and alternative sources of business funding for businesses with bad credit have arisen to fill this enormous need that business owners across the country face.

Revenue Based Funding For Businesses

You have a thriving business, revenue is right around the bend; but you need the funding now.  This is a common scenario for many growing businesses and there is a solution.   By leveraging your future credit card sales or business receipts for immediate working capital you can acquire an infusion of cash that can be used for your business needs.  There is really a night and day difference in degree of difficulty when it comes to acquiring this type of funding as opposed to a traditional bank loan.   While a traditional bank loans requires tons of documentation, impeccable credit, and an exorbitant amount of time to underwrite and fund; revenue based funding has no where near the same challenges when it comes to approval.  Approval is based on the revenue of the business, and once that is verified the funding can happen almost immediately.  This also applies to businesses with bad credit because, as stated before, funding approvals are given based on the ability of the business itself to pay back the advanced funds.  In measuring this ability to pay back the funds, a businesses revenue is the primary consideration as opposed to the business owner’s credit.  This can be the perfect way for a business to obtain fast funding if they already have steady provable revenue.

Things to Consider For Small Business Funding

The cost of borrowing is much higher with alternative revenue based funding as opposed to traditional bank funding and this cost must be taken into consideration by any business looking to obtain this type of funding.  It is important to have a plan in place on how to use the money so that you know the returns will more than outstrip the cost of borrowing.  Considering that these funds are often unsecured and available on a moments notice, it is no surprise that the cost would be higher than a traditional bank or SBA loan.  However, once you have completed a successful first round of funding (sometimes even before) terms and rates become much better when you request additional advances.  All things considered, this is a great alternative for medium to small size business looking for quick funding solutions.  This applies to businesses with both good credit and bad credit who need to get funding without a lot of hassle involved.  It is just important to weigh all the factors, which are different for every individual business, when deciding on pursuing this type of funding.  It’s just good to know that it’s there when you need it.