Your business is doing well. Your customer base is growing, and during the last quarter you actually turned a profit for the first time since you opened your doors last year. You have a solid business plan and now it's time to think about moving out of your rented space, buying more equipment, or perhaps hiring more employees.
Perhaps your business is profitable but during your slow season you're short of cash. Or your delivery truck just broke down and you have decided its time to get a new one. You need to get cash to keep your business moving forward.
Where do you start? The good news is that there are a wide variety of credit and loan programs available that can be applied to almost any business situation. The bad news is that the choices can seem complex and overwhelming. Here are some options that a small business owner can consider.
Business Lines of Credit
If your business is profitable over the course of the fiscal year but there are times when you are short of cash because your income is seasonal or cyclical, you may benefit from a business line of credit. A line of credit provides access to cash for a variety of short-term financing needs and gives you the flexibility to draw on the line at any time as long as you pay down the balance. Typically, once the line of credit is established funds are available when you need them, but the advantage is that you do not pay interest until you draw on the line. Lines can be secured or unsecured, with multiple repayment options and a variety of interest rates. Interest rates generally range from nine to fifteen percent based your personal and business credit history and other factors. You would generally not use your business line of credit for expansion or capital investment, because you may not realize income from your expansion for many months. For expansion you should consider a loan.
Business Loans $25,000 and Up
A business loan provides access to cash for many kinds of one-time expenditures and long term financing needs such as fixed asset purchases, or business expansion or acquisition. Unlike a line of credit, a business loan is amortizing and is fully disbursed when you close the loan. You may have the ability to lock in an interest rate.
There are many types of business loans:
• Vehicle Loan -- Finance the purchase of a new or used vehicle.
• Equipment Loan -- Finance the purchase of new or used equipment.
• Real Estate Loan -- Finance the purchase of commercial real estate.
• Secured Loan -- Get permanent working capital, improve cash flow, purchase inventory and materials, finance accounts receivable, expand or remodel facilities.
• Agriculture Loan -- Finance crop and livestock production expenses, purchase equipment, breed livestock, purchase land for farming or ranching.
• Cash-Secured Loan -- Get permanent working capital, improve cash flow, refinance debt, purchase inventory, materials, equipment, or vehicles, finance accounts receivable.
Business loan rates depend on a number of factors, including the amount you borrow, your collateral, financial strength of your business, term of the loan, and your credit rating. Over the past ten years business loan rates have fluctuated between four and eleven percent.
Small Business Administration (SBA) Loans
If you have less-than-stellar credit or you are not sure you qualify for a regular bank loan, you may qualify for a loan program backed by the Small Business Administration (SBA). The SBA has created a program of government-guaranteed loans designed to make loans to small businesses that may not otherwise qualify for credit. SBA loans make it possible to qualify businesses more easily and provide them with more flexible terms than conventional loan options. You can get more information at sba.gov/, or talk to your local commercial banker.
The SBA does not make loans to small businesses; it is a guarantor of loans made by private banks and other institutions. Talk to your local commercial bank when you're ready to consider a line of credit or a loan, and you'll see the range of choices available to you.
Friday, August 28, 2009
Thursday, August 20, 2009
3 Must Know Small Business Government Grants For Women Application Tips
If you are a woman looking to kick start your business venture in near future or your are seeking for a financial boost for your current business, you are at the right page as small business government grants for women is definitely better compared to loans because they do not require any form of repayment and recurring interest expenses.
In this government grants application tips article, we are going to move into some of the tips that are proven in helping women to get their government grant applications approved.
Understand the Competition
For different industries, there might be a huge difference in terms of the supply and demand for government funding. For example, our government is currently focusing more on technology advancement and thus, the availability of grants for tech-related businesses will be more compared to the arts and crafts industry.
Understanding the amount of competition will help you to determine the level of attention needed for your grant application. For grants with a low amount of competition, it may be due to the tedious red tapes but if you do not mind about it, you will get the money easily. Low competition also means that you need less effort to impress the panel.
Search Thoroughly in All Categories
One thing that is great about applying for small business government grants for women is that you can apply for as many as you are able to. Although there are a lot of them are covered under the category, Business and Commerce in in the list of grants available for application, you must not skip any of the categories that are relevant to your business.
Read thoroughly the terms for each grants that are related to your business. If you find that you can easily comply with the terms, by all means apply for it because you will increase your chances of getting free money for your business. There might also be new grants available from time to time so make sure that you revisit the application page often.
Plan Your Expenses Upfront
Treat government grants as your own money. You need to think that way in order to come out with a budget that will satisfy the panel. Before you are even being granted, you should do your homework on planning your expenses in detail. You might outdo other competition by adding the extra chart or explanation that shows them that you really cares about getting the grant.
In this government grants application tips article, we are going to move into some of the tips that are proven in helping women to get their government grant applications approved.
Understand the Competition
For different industries, there might be a huge difference in terms of the supply and demand for government funding. For example, our government is currently focusing more on technology advancement and thus, the availability of grants for tech-related businesses will be more compared to the arts and crafts industry.
Understanding the amount of competition will help you to determine the level of attention needed for your grant application. For grants with a low amount of competition, it may be due to the tedious red tapes but if you do not mind about it, you will get the money easily. Low competition also means that you need less effort to impress the panel.
Search Thoroughly in All Categories
One thing that is great about applying for small business government grants for women is that you can apply for as many as you are able to. Although there are a lot of them are covered under the category, Business and Commerce in in the list of grants available for application, you must not skip any of the categories that are relevant to your business.
Read thoroughly the terms for each grants that are related to your business. If you find that you can easily comply with the terms, by all means apply for it because you will increase your chances of getting free money for your business. There might also be new grants available from time to time so make sure that you revisit the application page often.
Plan Your Expenses Upfront
Treat government grants as your own money. You need to think that way in order to come out with a budget that will satisfy the panel. Before you are even being granted, you should do your homework on planning your expenses in detail. You might outdo other competition by adding the extra chart or explanation that shows them that you really cares about getting the grant.
Saturday, August 15, 2009
The Basics of Small Business Grants and How You Can Get One
Small business grants are a popular topic because they're alluring. After all, a grant will give you money to start your own small business, and you will not have to pay it back. It's sort of like getting a gift of money, or an inheritance.
There's a lot of confusion and misinformation about small business grants though, and there are a lot of scams too. So let's look at some of the basics...
1. Small business grants are not usually given out by the federal government. State government groups and offices however, often do give out small business grants for specific purposes. Generally state government grants are given to help create jobs and boost the economy in the state.
2. Small business grants are usually given for specific reasons. Not everyone can qualify for every grant available. Many grants are only available to specific minorities such as African Americans for instance, or women, or even African American Women. There are grants for Native American owned small businesses, grants for technology based businesses, and grants for innovative businesses too. And this is possibly the least understood aspect of small business grants. Many people mistakenly believe that anyone can get a grant, or multiple grants, just by applying. But you need to follow the application rules and guidelines. A small business owned solely by a man is not going to get a grant which is just available to women owned businesses.
3. Grants are offered by a variety of organizations. Many grants are offered by private foundations for instance, while others may be offered by corporations.
4. Small business grants take time. Most grants have a detailed, step-by-step application process that must be completed. And that application can take time to complete. A lot of time. Depending on the source of the small business grant, there may be other requirements that have to be met before they'll even look at your application too. And once the application is accepted, it could be a year or more before the organization decides who will get the limited number of small business grants they have available.
5. Small business grants are plentiful yet scarce. There are literally thousands of places to apply for small business grants, but each place usually has a very limited number of grants to give. It's not uncommon for there to be only one grant available from a given organization each year, and in some cases there's just one grant every five years or so.
6. Small business grants may not help a start up. This is another common misconception about small business grants. Many people who are ready to start a business, think that getting a business grant is the best way to get started. The problem though, is that many small business grants will only be awarded to existing or established businesses.
There's a lot of confusion and misinformation about small business grants though, and there are a lot of scams too. So let's look at some of the basics...
1. Small business grants are not usually given out by the federal government. State government groups and offices however, often do give out small business grants for specific purposes. Generally state government grants are given to help create jobs and boost the economy in the state.
2. Small business grants are usually given for specific reasons. Not everyone can qualify for every grant available. Many grants are only available to specific minorities such as African Americans for instance, or women, or even African American Women. There are grants for Native American owned small businesses, grants for technology based businesses, and grants for innovative businesses too. And this is possibly the least understood aspect of small business grants. Many people mistakenly believe that anyone can get a grant, or multiple grants, just by applying. But you need to follow the application rules and guidelines. A small business owned solely by a man is not going to get a grant which is just available to women owned businesses.
3. Grants are offered by a variety of organizations. Many grants are offered by private foundations for instance, while others may be offered by corporations.
4. Small business grants take time. Most grants have a detailed, step-by-step application process that must be completed. And that application can take time to complete. A lot of time. Depending on the source of the small business grant, there may be other requirements that have to be met before they'll even look at your application too. And once the application is accepted, it could be a year or more before the organization decides who will get the limited number of small business grants they have available.
5. Small business grants are plentiful yet scarce. There are literally thousands of places to apply for small business grants, but each place usually has a very limited number of grants to give. It's not uncommon for there to be only one grant available from a given organization each year, and in some cases there's just one grant every five years or so.
6. Small business grants may not help a start up. This is another common misconception about small business grants. Many people who are ready to start a business, think that getting a business grant is the best way to get started. The problem though, is that many small business grants will only be awarded to existing or established businesses.
Thursday, August 6, 2009
Small Business Loans For Women - Free Money Awaits
Are you trying to get your business off the ground or maybe you want to expand? Do you need small business loans for women to get yourself on your way? There are actually grants and loans that are designed just for the female business owner. This is because women are considered a bit of a minority when it comes to small business and the SBA is trying to help more women enter the business ownership world. Here are some helpful options for you to take advantage of.
First, you can try to get a grant and you may have some success. Go to your local SBA office and talk to them about the grant programs that are out there for women business owners. They may be able to get you some free money or at least some tax breaks and free training in some areas of business that you might find useful. Take advantage of anything they can help you with.
Second, the SBA also has specific loan programs to help women get their business off the ground. These usually are backed by the government and are pretty easy to get. As long as you have a strong business plan, have put up some of your own money, and have decent credit you will be able to get your business loan from the sBA. They will have all the information you need and can help you in many different ways.
Last, you can always go to your bank because some banks to cater to small business loans for women. They specifically do this because women tend to have much more success when they open their businesses and this is usually due to the fact that women have a more analytical approach to business. They will expect a business plan, a decent credit score, and you putting up some of your own money. They may also want you to put up collateral like your building or the land you are using.
First, you can try to get a grant and you may have some success. Go to your local SBA office and talk to them about the grant programs that are out there for women business owners. They may be able to get you some free money or at least some tax breaks and free training in some areas of business that you might find useful. Take advantage of anything they can help you with.
Second, the SBA also has specific loan programs to help women get their business off the ground. These usually are backed by the government and are pretty easy to get. As long as you have a strong business plan, have put up some of your own money, and have decent credit you will be able to get your business loan from the sBA. They will have all the information you need and can help you in many different ways.
Last, you can always go to your bank because some banks to cater to small business loans for women. They specifically do this because women tend to have much more success when they open their businesses and this is usually due to the fact that women have a more analytical approach to business. They will expect a business plan, a decent credit score, and you putting up some of your own money. They may also want you to put up collateral like your building or the land you are using.
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