It sometimes seems that getting a bank to provide a small business with a bank loan is like pulling teeth. Many just don’t like to take a risk on small businesses, particularly new ones. However, there are a few easy tips you can follow which may have them reviewing your loan request in a better light.
Start small. Borrowing small amounts helps build your track record. It shows that you are able to repay loans on time while also building your credit. That way, if and when you need a more significant loan, it may be easier to get.
Think cash, not collateral. Many businesses are tempted to put up an asset as collateral on a loan, but banks would rather see a positive cash flow. The greater your cushion, the more willing the bank is going to be to loan you the money. Generally, banks like to see five to six times the cash flow necessary to cover the interest payments on your loan. The difference between the interest you’ll pay each month and your cash flow is the bank’s cushion.
Packaging. Before you approach the bank, be sure your loan package is professional and detailed enough for the lender. Be sure to include such items as a one-page description of the size of the loan and what you plan to do with the money; 2 to 3 years of personal tax returns and business tax returns (if you have them); and a current personal and business balance sheet.
Raising money for your business can be frustrating, but don’t give up. You had the idea and the passion, now you need the perserverance. Sure, you may encounter a lot of “no’s” before you get a “yes”, but if you have a solid plan and a good business, chances are good that you’ll get that loan.
Do you worry about employees who send emails that may potentially open your company up to legal and/or regulatory problems? If you do, you are definitely not alone. However, a new software by Orchestria may assist in putting your mind at ease.
The Active Policy Management platform by Orchestria comes with modules designed to find e-mail that contains obscene or inappropriate words or reference. Not only that, it can detect a variety of red flag issues pertaining to confidentiality rules and official regulations violations such as HIPAA, Sarbanes-Oxley, and the Gramm-Leach-Bliley Act among others. Senders will receive a pop up telling them to fix the potentially damaging email. If they don’t, it can be blocked.
Typical prices for Orchestria start at $25 per seat and go up from there. While many may view it as not a very cost-friendly option. Others, who must weigh the costs of a potential scandal or lawsuit may think the investment is well-worth it.
The holidays can be a particularly stressful time for everyone as they try to work, attend holiday get togethers, school plays and events, shop, and deal with out-of-town guests. Business owners as well may feel the crunch of year-end inventories or holiday sales. Finding a solution that meets everyone’s needs can prove challenging, but ultimately well worth the effort.
Flexibility can be a business owners friend around the holidays. How so? By providing your employees with a flexible work schedule, you ultimately increase morale and productivity. A company policy that incorporates flextime to be used for meeting personal needs makes life easier on everyone.
For example, you could adopt a policy that allows employees time off as long as they agreed to make up the time or allow them to take a shorter lunch and bank time to leave earlier on a Friday. There are several other creative approaches that will keep morale up, employees relaxed and productivity high.
If you are concerned about year-end issues or an increased holiday workload, you can hire temporary help, move year-end inventories up a little or when possible, put projects off until after the holidays. You’ll be more relaxed and that can only help reduce everyone’s stress levels throughout your company.
Currently, most states allow employers to control the number of sick days they choose to give employees. However, if the National Partnership for Women Families and several activist groups have their way, it would become a federal law, and they’ve vowed to pressure the incoming Congress to do just that.
Recently, San Francisco became the first city to pass mandated sick time for employees. The new city ordiance which goes into effect in January requires that employers with 10 or fewer workers provide a minimum of five days of paid sick leave. Companies with more than 10 employees must pay for nine sick days a year.
A study by the Institute for Women’s Policy Research says the new requirement will cost San Francisco employers about $34 million a year, but also could help them save $46 million in reduced turnover and other costs.
Ask most small business owners and they would probably confirm the findings of a new JupiterResearch report which found that 78% of small businesses currently use the Internet on a regular basis. Furthermore, by 2011, 82% of small businesses will have Internet access and 88% will utilize broadband connections.
The influence of small business owners over the Internet was found in their purchasing power. In 2005 alone, small businesses reportedly spent over $43 billion in business purchases online. Online influenced off-line spending is projected to be even considerably higher.
For purposes of the Jupiter Research report, online small businesses were defined as companies with less than 100 employees and where the decision makers accessed the Internet on a regular basis. Ninety percent of online small businesses have less than five employees and they account for half of all small business online spending.
Everyone benefits from productivity — employers and employees alike. Unfortunately and sometimes unknowingly, employers can create road blocks which limit the productivity of their employees. First and foremost is a lack of training made available to both new and long term employees. Training should not stop after a general orientation for a new employee. It should an ongoing investment which will reinforce and advance skills and positive attitudes. The payoff of better performance and employee job satisfaction are well worth the investment.
Secondly,there is a tendency to overwork existing staff. Filling in once in a while for an absent co-worker or combining the job responsibilities of an employee who has left with another is not uncommon or unexpected. However, proceed with caution. Everyone has their limits and breaking point. Overworking an employee can lead to burn out, job dissatisfaction, and eventually, an employee who turns in their resignation.
Finally, conflicting personal and company goals. Employees are more likely to stick around and be productive when they feel their financial and professional goals are in alignment with the company’s. Do your employees feel that the pay check they receive compensate (monetarily or otherwise) them adequately for the time they commit to their job.
The rate of unscheduled absenteeism climbed to its highest level since 1999, costing some large employers an estimated $850,000 per year in direct payroll costs, and even more when lost productivity, morale and temporary labor costs. Those are the findings of the 2006 CCH Unscheduled Absence Survey which finds that employers continue to struggle with the issue of employee absenteeism.
Interestingly, Personal Illness is only a small percentage (35%) of the unscheduled absenteeism total number. Reasons cited why people were commonly absent included Family Issues (24%), Personal Needs (18%), Stress (12%) and Entitlement Mentality (11%).
With many of the reasons why employees are absent hinging on work/life balance issues, companies have attempted to find creative solutions that address these types of absences such as Employee Assistance Plans, Wellness Programs, Leave for School Functions, Flu Shot Programs and Alternative Work Arrangements.
However, when it comes to actual effectiveness, CCH found that companies rated programs like Alternative Work Arrangements, Leave for School Functions, Compressed Work Week, Telecommuting and Emergency Child Care to be the most effective.
Also found in the survey was the connection between low morale and increased absenteeism. Employees were more likely to call in sick unexpectantly if poor or low morale was cited at the company than an employee at a company that had a high morale level.
To read more on the CCH Survey, click here.
In a perfect world, we would always have enough revenues flowing in to cover our expenses. Unfortunately, this is no where near the reality that most business owners experience on a regular basis. Issues with billing and/or late-paying customers can definitely place our ability to meet our obligations in a timely manner in a financial choke hold. There are however a few things you can do to more effective manage your receiveables and expenses so that you aren’t caught in a financial crunch.
Project and track sales - by realistically projecting revenues/income for a specified period, you can plan and spend accordingly. Through tracking your sales monthly, you can quickly adjust your expenses should you find yourself not meeting your projected revenues.
Forecast your cash flow – while it may take a little time, analyzing when and how much your customers will pay you can help you in forecasting your cash flow. A general rule of thumb is the amount you forecast should be within 5% of your receivables each month. If you are way off, you may encounter a potential cash crunch around the corner.
Be prepared – its common for any business to experience cash flow fluctations throughout the year. Knowing when yours will occur allows you to take steps to plan for those leans months. Set cash aside to address those needs.
If budgets, projections, and forecasts just aren’t your forte, do not hesitate to call in a professional to help you. A few hours invested with a qualified professional can make all the difference in the world.
Thanks to automated teller machines, Web banking and electronic payroll deposits a trip to the bank is becoming obsolete. Nowadays, its seems like the only time you have to go is when you need to deposit a paper check. However, that is now changing for small businesses as well.
In 2003, a federal law was passed giving digital check images the same legal weight as paper checks. That’s when many companies set up programs that allowed them to scan the checks they received from customers and deposit them electronically. Today, thanks to new and affordable check scanners, small business owners can scan their checks into the computer and deposit them via the internet.
Several banks and manufacturers are offering various versions of the check scanners to small business owners. RDM Corporation makes one that also connects to QuickBooks accounting software. Wells Fargo, PNC, Panini, Unisys and Epson also make versions that range in costs from $500 and up. Definitely worth a look if the only reason you need to stop at your bank is to deposit paper checks.
Health care costs are a major concern not just among employees, but among business owners as well. The annual cost increases, types of plans/coverage available, and determining the appropriate level of employee contributions add up to one protracted headache.
The article, “Get a grip on health care costs” provides a few useful tips geared to small business owners that can assist them in lowering their health care expenses. Additionally, it gives a brief overview to the advantages of setting up high-deductible plans. To read the article, click here.
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