Why Have So Few “Small” Businesses Gotten Relief from the SBA?

The first round of SBA PPP small business financing has come and gone and the thousands of small businesses that make up the Kapitus client base have largely been left out in the cold.  While we eagerly await Congress’s approval of additional funds, we used this time to survey our customers to understand who was able to obtain funds from the first $349 billion in forgivable loans, who was not, and which financial institutions were most helpful in supporting small businesses.

What we found was a troubling dependency by small businesses on the largest financial institutions in the country (national and regional banks).  These large banks, as well as the SBA itself, seem to be leveraging a definition of small business that allows large companies to fit their subsidiaries into qualifying entities while independent business owners are overlooked.  The national banks appear to have systematically prioritized these large clients over their smaller constituents and in doing so, exhausted the first round of SBA funding faster than many anticipated.

Our survey was conducted between April 17th and 20th and targeted 26,536 small businesses that we have provided capital to over our 14-year history.  As of Monday morning, we had received 2,076 responses, 80% of which told us they had applied for SBA PPP funding before the money ran out.

Of those respondents, 1,206 answered the question “have you received funding from your PPP application” and 1,116 or 92.5% told us that unfortunately, they have not.  The 90 customers that have received funding provided tantalizing clues as to how small businesses are getting money from the SBA.  The most successful channel to date appears to be through community banks, where 18.8% of applicants have been successful and where customers are more likely to have a personal relationship with a decision-maker inside the bank.

Kapitus PPP Survey

Credit unions have also been moderately successful with 11.8% of applicants receiving funding but have a much lower penetration rate than other banking channels.  Regional banks follow at a 7.2%, followed by the SBA itself (2.7%) and non-bank lenders (1.4%).  Sadly, national banks (such as Wells Fargo, JP Morgan, Bank of America and Citigroup) which have the greatest penetration into the US small business community, have to date done the least to help small businesses in their time of need.  National banks only produced three successful loans in our survey out of 320 applications, a dismal 0.9% success rate.

Why is it that national banks have done so poorly serving the small business community?  Banks are economic animals with scarce resources just like any other company.  When a large number of clients request a scarce resource at the same time, they prioritize their largest, most profitable and riskiest clients first.  In our survey, community banks supplied small businesses with more lending products than any other bank segment.  This indicates that community banks have deeper ties and greater exposure to the plight of small businesses and as a result, during a crisis they work more diligently to ensure that their needs are met.  As seen in the table below, our clients utilize community banks and non-bank lenders more heavily than other types of credit institutions.

Kapitus PPP Survey

Another part of the answer lies in what the SBA, and in turn the nation’s largest banks, consider “small” when it comes to business.  On April 16th the SBA announced that they had distributed nearly 1.7 million loans representing $342 billion, indicating an average loan size of $206,022.  Assuming the average American worker was making $49,764 annually (or $4,147 per month) just before the crisis (Oficina de estadísticas laborales) and considering that PPP loans are sized based on 2.5 times monthly payroll, this implies that the average company getting a PPP loan as of April 13th had 20 employees.  There are nearly 6 million companies with between 1 and 500 employees and the average company in this group has 10 employees (US Census Bureau).  This means that fewer than 28% of eligible small businesses were served in the first round of SBA funding, and those that were served were the largest companies in the range. This argument is supported anecdotally by the fact that companies like Ruth’s Chris, Potbelly and Fiesta Restaurant Group each received between $10 million and $20 million in PPP loans through JP Morgan.  Kapitus PPP Survey

This sequence of facts has been very frustrating to non-bank lenders such as Kapitus who are the only consistent source of financing available to most businesses with 10 or fewer employees.  We have been petitioning the SBA for a temporary license to allow us to lend the PPP product to our core client base (our average customer has 8 employees) since the program was announced.  Nearly two weeks into the program the SBA released an application for non-bank lenders, and we submitted our application within 12 hours of its being published.  Eleven days later we have heard nothing, although some of our larger competitors did receive temporary licenses just as the money in the first tranche was exhausted.

Undeterred, we are working with our clients to secure PPP loans in any way we can.  We have partnered with several community banks and non-bank lenders with SBA licenses to fund our clients and we are lining up additional capital to fund these loans ourselves when and if we are awarded a license.  In the meantime, we counsel or clients on their financing options and continue to provide innovative lending products as small businesses struggle to navigate the most challenging business environment any of us have ever seen.  America’s small businesses owners are some of the most creative and resilient leaders our country has.  We look forward to partnering with the SBA to offer small business owners the solutions they need to survive, rehire, rebuild and reopen as soon as it is safe to do so.

To receive the most recent updates on Paycheck Protection Program and other federal, state and local relief initiatives aimed at helping small businesses visit our COVID-19 Resource Center.

 


About the Author

About Kapitus - Ben Johnston

Ben joined Kapitus in 2014 as Chief Strategy Officer and became Chief Operating Officer in January 2017.  Prior to joining Kapitus, he was a Principal of Pine Brook Partners, a New York-based private equity firm where he invested in banks, insurance companies, asset managers and specialty finance companies.


Business Loans in NC: Your Ultimate Guide

As a small business owner in the Tar Heel state, you focus on the future with your hands on the present. You have plans to take your business to the next level. Luckily as a North Carolina resident, there are many types of loans from a variety of organizations and institutions to support your business specifically. Depending on your needs and plans, you’re sure to find business loans in NC that fits the bill.

You want to expand your staff; increase your product offerings; ramp up your credit; grow your inventory; invest in an exciting new opportunity. But to realize those plans, you need some financial support from a lender who understands you and your business on a near-personal level. You want a small business loan made just for you. Today, we’ll explore the offerings available to North Carolina residents and businesses so you can make your next move expediently.

Carolina Small Business Development Fund Loans

If you’re looking for business loans in NC, a great place to start is the Carolina Small Business Development Fund–a nonprofit and Community Development Financial Institution that “lend[s] to start-ups and existing businesses across the state, with emphasis on businesses that have difficulty accessing financing through traditional loan sources.”

Carolina Small Business offers a variety of core loan products specific to businesses in the state. For example, if you live in Mecklenburg County, have an annual revenue of less than $1,000,000,000 and don’t have any unpaid judgments, open tax liens, or principal and business bankruptcy in the past five years, you may qualify for the Mecklenburg County Small Business Loan Program. This program offers up to $75,000.

Are you rebuilding your business in the wake of a natural disaster? Consider the Small Business Recovery Fund. It’s designed to “provide gap financing as a complement to Small Business Administration [SBA] and other disaster recovery programs.” This loan grants a minimum of $1,000 to small businesses with no maximum amount. Other disaster-based loan programs offered by Carolina Small Business include the Hurricane Florence Recovery Loan Program.

Carolina Small Business also offers Veterans Direct loans if they’re in-state veterans and/or their spouses are, and Healthy Carolina loans to established businesses and new entrepreneurs involved in the “production, processing, wholesale, distribution, and retail of healthy food products.” This is only possible as long as they’re located and selling healthy foods and food products in food deserts. In addition, Carolina Small Business’s African-American Loan Fund assists African-American entrepreneurs as they develop and expand their businesses.

Mountain BizWorks Loans

Live in Western North Carolina? If so, you may qualify for a loan with Mountain BizWorks. Mountain BizWorks offers loans as low as $1,000 to as high as $250,000 for small businesses in your area. Their model is unique. This means that they “consider non-traditional collateral, offer flexibility in the loan structure, and loan decisions and relationships are managed locally.” What’s more is, they’re willing to work with you to discuss out-of-the-ordinary circumstances that might have hurt a once-strong score. Interest rates vary based on your individual circumstance. However, they promise an answer within two to three weeks of your loan application.

Carolina Farm Credit

Carolina Farm Credit specifically applies to North Carolina’s farmers and rural residents. They offer farm and land loans for agribusinesses. As a farmer, you can seek support in funding for farm improvements, equipment, livestock and operations. Carolina Farm Credit offers farm land and acreage financial options. This is a good option if you’re hoping to expand physically or just get off the ground.

Local Banks and Credit Unions

When it comes to finding the right loan for your business, banks and credit unions can be particularly helpful. Local banks may provide additional tools and resources and leverage connections to help you get a loan that suits your needs and credit that a nationally recognized bank might not be able to do. In North Carolina, there are many banks that value small businesses and their contribution to the economic well-being of the state.

BB&T

With 285 branches in nearly 200 cities, BB&T is one of the biggest banks in the state. Its options for small business loans in NC are vast. Borrowing options include loans through BB&T, and benefits for members who utilize the SBA.

Self-Help Credit Union

Self-Help Credit Union, another major bank in North Carolina, offers small-business and commercial loans, as well as:

Truliant Federal Credit Union

Truliant Federal Credit Union has branches throughout the state. They offer herramientas to help you assess your business’s finances and secure the right loan for your needs. Loan options include SBA loans, USDA business and industry programs, construction and auto loans, equipment financing and others.

First Bank

First Bank, located throughout the Carolinas, is another fantastic option for business loans in NC. As a local bank, First Bank is intimately familiar with the markets your business touches. They can use that knowledge to support you in making financial decisions. First Bank’s small business loan offerings range from SBA loans to credit cards to lines of credit and beyond. They suit solopreneurs, entrepreneurs, and business owners with dreams to expand their business, to reconfigure financial structures, finance major investments, and beyond.

SBA Lenders

There’s a host of SBA lenders dedicated to supporting North Carolina small businesses in securing loans. According to the SBA North Carolina District Office, these include “SBA 7(a) Lenders, 504 Certified Development Companies, and SBA Microlenders.” For specific details and contact information, see the SBA North Carolina District Office’s official list.

As a small business owner based in North Carolina, you have lots of location-specific borrowing options. While this list contains some of the best and most diverse options for NC business loans, it certainly isn’t every single available option. In fact, depending on the nature of your business, your location and your needs, you might even be surprised to find a loan that’s “tailor-made” just for you.

Funding your next business endeavor can feel daunting, time-consuming, and confusing. If you find yourself feeling overwhelmed by choice and unsure where to start, utilize the resources offered by local banks (or local branches of major banks), the small business administration, or the Carolina Small Business Development Fund. Or, for fast, personalized service, unique expertise, and an answer guaranteed in as little as hours after you apply, consider finding your best financing solution through Kapitus. Once you’re approved, you can hit the ground running and make those pivotal moves that take your small business to the next level in 2020 and beyond.

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What is a PEO? And How to Choose the Right One for Your Business

You probably started your business because you enjoyed the work. Maybe you opened your ideal restaurant or started an electrical contracting business. That part was fun, but other responsibilities surfaced. Now, you have to deal with employees’ human resource issues, find ways to offer benefits and make sure all payroll taxes were filed and paid. Fortunately, small business owners don’t have to cope with these responsibilities by themselves. Professional employer organizations can lift those chores off of the owners’ shoulders. This helps business owners focus more on managerial tasks and growing their businesses. Now, what is a PEO, exactly?

What is a PEO?

A professional employer organization and a business enter into a shared relationship known as “co-employment.” Co-employment means that the PEO is the employer on record. They provide human resource support and handle payroll functions – while you, as the owner, keep the authority and responsibility. You’ll still manage your employees’ day-to-day activities.

Through the co-employment model, PEOs:

  • Are responsible for paying wages, managing employee compensation claims and overseeing other wage-related requirements
  • Assist with regulatory paperwork and compliance issues
  • Manage human resource issues and risk management functions
  • Provide employee benefits. Benefits include- but aren’t limited to – health insurance, unemployment insurance, Section 125 plans and other voluntary insurance products.

What are the Client’s Responsibilities?

The business owner is responsible for:

  • Managing employees’ daily activities
  • Maintaining a safe work environment
  • Keeping track of hours worked and reporting these figure to the PEO
  • Making sure payroll funds are paid in advance to the PEO

Advantages of a PEO

PEOs can take time-consuming HR tasks and responsibilities off your plate. A PEO:

  • Handles all human resource activities so you can focus on managing and growing your business
  • Provides competitive benefits and health insurance. A PEO has the purchasing power to negotiate better health insurance rates and more affordable benefits, such as a 401(k)plan, dental and vision coverage. Using the lower-cost benefits from a PEO enables small- and medium-size companies to compete with and attract employees from larger companies.
  • Stays up-to-date on regulations. As a business owner, you don’t have the time to read the latest regulations. A PEO does this for your and makes sure that you remain compliant.
  • Provides attorneys and HR professionals to handle employee-related issues. PEOs give advice on proper employee termination and disciplinary procedures.

Disadvantages of a PEO

Method of pricing

Sometimes, it can be difficult to determine how much you’re really paying. Many PEOs price their programs as a percentage of wage payroll, but this figure can vary monthly. So, sometimes it’s hard to figure out how much you’re actually paying. The other pricing method is the per-employee-per-month. This approach has add-ons for setup fees, administrative fees and costs for running some payroll reports.

Inflexible health plans

PEOs partner with certain insurance companies, and you don’t have a choice. If you like UnitedHealthCare, but the PEO promotes Aetna, you have to accept Aetna.

Customer service

PEOs handle large numbers of clients and employee issues. Customer service responses can sometimes seem rushed and indifferent.

How to Choose a PEO

Choosing the best PEO for your company requires doing your homework. Here’s a list of questions to help you get started.

  • Assess your company’s needs. What do you need help with -Payroll processing, HR issues, employee benefits? Define what you need before approaching a PEO.
  • Is the PEO a member of the National Association of Professional Employer Organizations? Membership in the industry’s trade organization indicates professionalism and respect.
  • Does the PEO have experience in your industry? You want a PEO that understands the daily lives of your employees and the risks they take on their jobs. How many employees do they represent in your industry?
  • Conduct a background check; ask for references to check; get first-hand feedback directly from the PEO’s clients.
  • Are the financial statements independently audited by a CPA? You want assurance that the PEO is legitimate.
  • Are their risk management practices certified by the Certification Institute?
  • Have their ethical practices been accredited by the Employer Services Assurances Corporation? ESAC audits PEOs annually to make certain each PEO has at least a $1 million surety bond.
  • Does the PEO have certification from the IRS? Check for accreditation such as the Certification Program for Professional Employer Organizations from the Internal Revenue Service.
  • Review the fine print in the contract. What guarantees does it provide? How can you terminate the contract if the relationship goes bad?

 

According to NAPEO, the U.S. has over 900 PEOs. While you have plenty of choices and setting up a co-employment agreement with a professional employer organization will relieve you of a ton of administrative tasks, you must thoroughly investigate each PEO candidate before signing on the dotted line. You don’t want any surprises.

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The Best Business Loans for Franchise Purchases and Improvements

Are you exploring business loans for franchise purposes? You’re likely bringing some of your own money to the table to finance your dream. However, that doesn’t mean that you won’t need help with other startup costs, future expansion or ongoing funds. You might be surprised at how many options there are in the marketplace. This guide will help get you up to speed on the most popular franchise financing options according to two main objectives: buying a first/additional/multiple franchises and funding existing franchise operations.

Get ready to feel better about your financing options for the next chapter in your entrepreneurial career. Your franchise ownership goals are within reach.

Buying Your First/Additional/Multiple Franchise Locations

Whether you’ve got your eye on owning your part of a franchise or ready to expand your franchise footprint, you’ll need one of the many flexible-use business loans for franchises.

The three most popular types of franchise financing are:

  • Traditional loans
  • Small Administration (SBA) loans
  • Franchisor financing

Look at how each of these financing options can fit the needs specific to someone purchasing an initial franchise.

Traditional loans

When considering the different business loans for franchises, traditional business loans top the list. Proceeds can help purchase or expand franchise holdings.

Traditional loans are smart financing options for small business owners confident that they have the financials and good credit to qualify. With generous loan limits, highly competitive interest rates, and flexible terms, these loans will likely offer some of the best rates in the market. You’ll need to come to the table equipped with solid financials. The rigorous underwriting process is one of the reasons these loans typically offer the most competitive terms. Traditional loans might be an attractive option. Show three years of tax returns, a strong personal financial history and a good credit score. The lender will verify fund source you’re using for your down payment.

With traditional loans, your franchise choice could play a significant role in the approvals process. Lenders like to see big brand names with proven track records in the market. Franchises with few locations might hurt your application. These franchises haven’t worked in multiple markets and various economies. Yet, if you’re a new franchise owner, a traditional loan can use your personal credit and financial history to launch your new venture.

SBA 7(a) loans

los SBA 7(a) loan program is hands-down the most popular loan program. It’s a reliable option for financing franchise startup and expansion costs. When you use these types of business loans for franchises, you’ll find competitive rates and virtually unlimited use of funds. Loan Limits are generous, and flexible terms are perfect for a franchise on the rise.

The first step to qualify for an SBA (7a) loan is to make sure your franchise is listed in the SBA Franchise Directory. If they don’t list your franchise type, you can apply for participation in the directory (note: the SBA will require additional documentation).

Loan limits are up to $5 million and terms range from 10 to 25 years. Interest rates are generally in the single digits (7% to 9.5% is a good range to consider). Prospective borrowers will usually have to be in business for at least two years. This makes the SBA 7(a) loan a better match for existing franchise owners, or those purchasing a franchise in an industry where they have a proven career track record. Lenders will use your credit score and business financials for qualification. While the approvals process isn’t speedy, you’re rewarded with some of the best rates and terms, aside from traditional loans.

The only limit to an SBA 7(a) loan is borrowers can’t use the funds to finance franchise or royalty fees. If you choose to go the SBA 7(a) route, make sure you earmark other funds for these startup costs.

Franchisor financing

Many of the nation’s leading franchises offer direct financing to entrepreneurs. Of course, they want to make it simple for owners to get up and running. This one-stop-shop approach is potentially perfect for those looking to open their first location, adding a location, or purchasing multiple locations at once.

While the rates might not be as competitive as traditional loans or the SBA 7(a) loan, there’s something to be said for a streamlined process. As you consider all the options for business loans for franchises, it’s worth it to speak to the franchise and see what options are available. Be sure to have your attorney or accountant review any financing options offered by the franchise. Then you can compare the terms between a traditional loan, SBA 7(a) loan and the franchise’s direct financing side-by-side.

Funding Ongoing Franchise Operations

You may find times where you need a cash infusion to help fuel operations and growth. The best business loans for franchise needs in these cases is the one that matches:

  • The reason you need the funds
  • How long you need to repay the funds
  • How much you need to borrow

Here are three financing options franchises can use to keep operations running smoothly and make specific improvements.

Traditional business loans

If you know you need a fixed amount of cash for an upcoming franchise improvement or expansion expense, a traditional business loan can help. With fixed terms and rates, small business owners can fund franchise expenses with a predictable impact on their monthly budget.

Repayment terms are often flexible, including payment frequencies based on your current cash flow. Traditional loans have stringent qualification guidelines, and not all businesses can qualify with ease. You’ll need to have existing operations with a proven balance sheet, a plan, and your financials in order.

Lines of credit

If you’re looking for a more flexible way to access the cash your franchise needs, a line of credit might be the ideal tool.

Lines of credit can be used for nearly every purpose imaginable. You can draw as much or as little as needed–and only pay interest on the funds drawn. Once you pay it back, your credit line is once again fully available for use. There’s no need to go through the qualification process again.

For businesses that may not qualify for a traditional loan, lines of credit can fill that financing gap. Credit scores aren’t weighed as heavily in the approval process for most lines of credit, either. These features combined make lines of credit ideal to fund everything from cash flow gaps to seasonal inventory ramp-ups. The sky’s the limit.

SBA 504/CDC loans

While the SBA 7(a) loan is an ideal fit for initial or additional franchise purchases, you’ll need a different SBA loan type for funding ongoing business concerns.

los SBA 504/CDC loan has a narrow scope of use. Funds must be used for acquiring, renovating, or improving real estate or equipment. A borrower’s franchise location must also be U.S.-based. This type of loan can help fund making improvements to franchise real estate, buying real estate, or even upgrading heavy equipment to speed operations.

As with the SBA 7(a) loan, your franchise needs to be listed in the SBA Franchise Directory to be eligible. While these loans are slower to fund than traditional bank loans and lines of credit, you’ll likely be rewarded with some of the best interest rates. With all of the options for business loans for franchises, there’s one out there that makes perfect sense for your financials, credit and goals. And, if you’re still trying to determine the next steps in your franchise financing plans, you can always reach out to a loan officer to discuss.

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Cómo recuperarse de un rechazo de préstamo para pequeñas empresas

El rechazo siempre duele, y cuando es del banco en un préstamo para pequeñas empresas, puede picar un poco más de lo que lo hizo en la escuela secundaria. Los préstamos son el alma de la mayoría de las pequeñas empresas, y sin ellos, la compañía podría colapsar y arder. De hecho, según el Administración de Pequeños Negocios, El 27% de las pequeñas empresas encuestadas declararon que no podían recibir los fondos que necesitaban para expandir sus negocios.

However, there is hope. Many businesses have been rejected only to recover and secure the financing they need on the next application. Here are our tips to help you recover from a rejection.

Determinar la razón

Lo primero es lo primero, debe poder identificar su error para corregirlo en el futuro. La mayoría de los prestamistas le darán la razón por la que su solicitud fue denegada y generalmente es uno de los dos problemas:

  • Puntaje FICO bajo
  • No hay suficientes ingresos

Antes de otorgar préstamos a una pequeña empresa, al igual que cualquier otro préstamo, quieren asegurarse de tener un historial sólido de pago de sus deudas a tiempo y en su totalidad. Si sus puntajes de crédito personales y comerciales son menos que estelares, los prestamistas lo percibirán como una inversión de riesgo.

Además, los prestamistas desean saber que los prestatarios pueden realizar los pagos mensuales mínimos del préstamo para pequeñas empresas. Aquí es donde entra en vigencia el flujo de efectivo de su empresa: calcularán su relación deuda / ingresos para ver cómo podría manejar los pagos mensuales.

Corrige el problema

Hay soluciones tanto a corto como a largo plazo. No puede arreglar su puntaje de crédito en una semana, pero si lo hace una prioridad, con el tiempo, podrá mejorarlo. A corto plazo, puede, en primer lugar, asegurarse de que su informe de crédito esté libre de errores. Sucede más a menudo de lo que piensas como el 23.17% de todas las quejas a la Oficina de Protección Financiera del Consumidor en 2016 fueron sobre inexactitudes en los informes de crédito.

Además, para mejorar su calificación crediticia, puede tomar medidas para pagar sus deudas para mejorar su relación deuda / ingresos, lo que le hará lucir más favorable a los prestamistas.

Para mejorar sus flujos de ingresos y mostrarle al prestamista que su empresa está aportando suficiente dinero para cubrir los gastos y los pagos del préstamo, debe hacer todo lo posible para reducir los gastos y aumentar los márgenes de ganancias. Mejorar el flujo de efectivo puede ser un desafío para algunas pequeñas empresas. Sin embargo, muchos están encontrando el éxito después de poner toda su atención y esfuerzos en el proceso.

Otras cosas a considerar

Hay algunas cosas que puede hacer para mejorar sus probabilidades de asegurar un préstamo de pequeña empresay están destinadas a hacer que parezca más confiable como prestatario.

Puede hacer un pago inicial considerable en el préstamo para demostrar que realmente desea reembolsar el préstamo. También puede obtener un cosignatario con una excelente puntuación de crédito para que parezca más confiable. Sin embargo, el cosignatario también estaría pendiente del préstamo, así que asegúrese de poder realizar los pagos con confianza.

Si tiene un puntaje FICO bajo, también debe buscar financieros alternativos que puedan ofrecerle opciones financieras. Los grandes bancos no son los únicos prestamistas que hay. Además, un puntaje de crédito bajo no necesariamente lo sacará de consideración con prestamistas alternativos.

Qué hacer antes de volver a aplicar

Antes de pasar nuevamente por la frustración y la pérdida de tiempo del rechazo de un préstamo, debe echar un vistazo a usted mismo y a sus negocios desde el punto de vista del prestamista; ¿hay alguna bandera roja?

We recommend taking a hard look at your credit report. Even asking a lender’s advice about any problems they see. It may seem scary to ask them to point out problems, but the issues might arise when you re-apply for the loan anyway. So, it’s better to know beforehand.


Small Business Loan Application Checklist | Updated for 2020

Construir y dirigir una pequeña empresa es difícil. Se necesita convicción, liderazgo, buena gestión y, cada cierto tiempo, una inyección de financiación muy necesaria. Tanto en tiempos buenos como en tiempos difíciles, las empresas a menudo se enfrentan a la decisión de buscar algún tipo de financiamiento. Sin embargo, solicitar y adquirir préstamos para pequeñas empresas y financiamiento alternativo a menudo puede ser desalentador, incluso si lo ha hecho antes. Y los prestamistas tradicionales no hacen esa experiencia fácil.

La buena noticia es que obtener financiamiento no tiene por qué ser tan difícil. Ayudamos a miles de pequeñas empresas todos los días y queremos compartir secretos para obtener buenas opciones de financiamiento rápidamente. Por lo tanto, hemos compilado una simple lista de verificación de acciones que puede tomar para hacer el proceso rápido, sencillo y fácil.

Sin embargo, a medida que se prepara para solicitar un préstamo para pequeñas empresas, debe considerar las siguientes preguntas cuidadosamente para asegurarse de que no se sorprenda ante cualquier solicitud imprevista o decisiones adversas de los prestamistas.

Six questions every business must ask in 2020 before applying for a small business loan | Descargar PDF

1. ¿Debe solicitar un préstamo para pequeñas empresas?

Si bien un préstamo para pequeñas empresas es una excelente manera de reducir la presión sobre los flujos de efectivo, podría tener alternativas viables para aliviar la crisis del flujo de efectivo, como vender deuda con su empresa y renegociar contratos para permitir plazos de pago más largos. Además, asegúrese de haber considerado todas las fuentes alternativas de financiamiento, incluidos amigos y familiares.

2. ¿Es un préstamo para pequeñas empresas bueno para su negocio?

Comprenda el efecto del pago de un préstamo para pequeñas empresas en su flujo de efectivo. Un préstamo no cambia el funcionamiento fundamental del negocio. Fortalece un negocio fundamentalmente sólido y rompe rápidamente un negocio que es fundamentalmente erróneo.

3. ¿Puede usted calificar para una subvención de negocios?

A diferencia de los préstamos, usted no tiene que devolver las subvenciones. Antes de solicitar un préstamo para pequeñas empresas, vea si califica para un subvención federal o privada para pequeñas empresas. Sin embargo, las subvenciones pueden ser muy competitivas y pueden no ajustarse a su horizonte de tiempo financiero.

 4. ¿Qué tipos de préstamos para pequeñas empresas existen?

Hay más de una docena de tipos de préstamos para pequeñas empresas y opciones alternativas de financiamiento para pequeñas empresas. Las opciones más populares son los préstamos de la SBA respaldados por el gobierno, el financiamiento basado en ingresos y el factoring. Descarga esta eGuide para aprender más sobre los diferentes tipos de financiación de pequeñas empresas.

5. ¿Cuándo debe solicitar un préstamo para pequeñas empresas?

Apply only once you have determined that a business loan will help strengthen your business, and you understand the different types of financing options like Small Business Loans, Revenue Based Financing, Factoring, and Financiación de equipos. Each of these options have unique requirements so make sure you understand them well before speaking with a lender.

6. ¿Debes trabajar con un corredor de préstamos para pequeñas empresas?

Los corredores son un gran recurso para obtener ofertas de varios prestamistas. Sin embargo, muchos mercados en línea, como Kapitus, obtendrán ofertas de varios prestamistas sin la comisión adicional que corre a cargo del prestatario.

Lista de verificación de solicitud de préstamo para pequeñas empresas| Descargar PDF

1. Ejecute un análisis rápido de flujo de efectivo en su cuenta comercial

Los flujos de efectivo son uno de los indicadores principales que los prestamistas utilizan para comprender la salud de su negocio. Mostrar de 3 a 6 meses de flujo de efectivo positivo puede lograr que usted sea aprobado más rápido. Incluso puede obtener mejores términos de financiamiento para su préstamo para pequeñas empresas. Puede aprender más sobre los flujos de efectivo y las formas de mejorarlos en "Cómo preparar su pequeña empresa para las necesidades de flujo de efectivo.

2. Recoger al menos 3 meses de extractos bancarios.

Your business accounts are another good indicator of your company’s financial health. Generally, lenders want to see a positive daily balance on your bank statements. Remember, a well managed cash flow will directly improve your bank accounts.

3. Identifique depósitos inusualmente grandes en sus cuentas bancarias y reúna documentos de respaldo para ayudar a explicarlos.

Si bien la presencia de depósitos inusualmente grandes puede demorar la finalización de los préstamos, no son necesariamente malos. Muchas empresas, como las empresas de construcción, pueden explicar fácilmente su presencia en los extractos bancarios. Algunas empresas comprensiblemente tienen grandes cambios en depósitos y créditos en su cuenta. Si su negocio es así, puede acelerar el proceso de solicitud de préstamo y obtener términos realmente buenos para su préstamo para pequeñas empresas al proporcionar una copia de sus cuentas por cobrar y contratos futuros.

4. Obtenga una copia de su informe de crédito gratuito y asegúrese de que no haya banderas rojas

Un crédito personal sólido hace mucho para asegurar a cualquier prestamista la responsabilidad fiscal de la persona que dirige el negocio. Puede obtener una copia gratuita de su informe de crédito en annualcreditreport.com. Si encuentra información incorrecta en su informe de crédito, comuníquese con cada agencia de informes de crédito (Experian, Transunion y Equifax) inmediatamente para corregir el problema. Tenga en cuenta que si bien las pequeñas moras son comprensibles, los prestamistas se sienten incómodos con las declaraciones que muestran morosidad en la manutención de menores o quiebras recientemente descartadas (no canceladas).

5. Reduzca el número de prestamistas a quienes debe dinero

Demasiados prestamistas que sacan dinero del negocio pueden crear una severa tensión en su flujo de efectivo. Los prestamistas desean saber que el dinero que proporcionan ayudará a hacer crecer su negocio y no pondrá una presión adicional en sus operaciones diarias. Es posible que desee esperar para finalizar sus obligaciones de préstamo actuales antes de volver al mercado para reunir más capital.

6. Resolver cualquier gravamen fiscal abierto

Los gravámenes impositivos abiertos no resueltos pueden afectar su capacidad para obtener financiamiento. Si es posible, intente obtener un plan de pago sobre cualquier gravamen fiscal abierto. Un plan de pago sobre un gravamen fiscal es mucho mejor que un gravamen fiscal abierto no resuelto.

7. Consigue tres referencias comerciales.

Las referencias comerciales ayudan a establecer la autenticidad y la credibilidad de su negocio. Si alquila un espacio comercial para su negocio, asegúrese de que el propietario sea una de sus referencias.

8. Tenga a mano declaraciones de impuestos cuando solicite una suma grande

Por último, las empresas que contemplan pedir prestado grandes sumas de más de $ 75,000 deben obtener una copia de su declaración de impuestos del año pasado y de sus estados financieros comerciales.

Obtener préstamos para pequeñas empresas no tiene que ser un proceso desalentador. Use esta lista de verificación antes de solicitar un préstamo comercial o una financiación alternativa y obtenga los fondos que su empresa merece.


5 cosas que no sabes sobre el capital de trabajo, pero debes

El capital de trabajo, la cantidad restante después de restar los pasivos actuales de los activos actuales, es el elemento vital de una pequeña empresa. Sin embargo, muchas personas todavía están confundidas acerca de sus beneficios y usos. Aquí hay cinco cosas que muchos propietarios de pequeñas empresas no saben acerca de este importante recurso que ayuda a una compañía a sobrevivir y prosperar:

1. El capital de trabajo puede ayudar a la estrategia a largo plazo, no solo a los problemas a corto plazo.

La mayoría de los empresarios se enfocan en cada uno de los costos cuando inician su negocio. Pero al igual que un jugador de ajedrez de clase mundial, debe pensar varios pasos adelante y ser consciente del capital que necesitará para expandirse a nuevas ubicaciones, contratar nuevos empleados o comprar más equipos. Un franquiciado, por ejemplo, debe estar al tanto de las actualizaciones que serán necesarias. El capital de trabajo no es solo un recurso para necesidades a corto plazo, sino para todo el año venidero.

2. Debe controlar su flujo de caja semanalmente o incluso a diario.

Many small businesses only review cash flow twice a year – on April 15th and October 15th. It debería be a weekly or even daily exercise. When a solid client who has always paid on time starts slipping, it could indicate problems that you want to be aware of as soon as possible. According to Investopedia, the most important way for a small business to analyze its working capital is by operating cycle – the average number of days it takes to collect an account.

3. Debería compararse con otras industrias.

Las pequeñas empresas a menudo están satisfechas cuando sus prácticas de capital de trabajo son iguales o mejores que sus competidores directos. En su lugar, considere industrias con características similares, que pueden proporcionar más ideas sobre cómo fortalecer sus prácticas de capital de trabajo.

4. Anime a los clientes a pagar a tiempo.

Many small businesses have found themselves in difficult circumstances, or have even gone out of business, when they were afraid to call out important clients who constantly drag out payments. “It’s a simple thing to get accounting software and monitor your working capital,” says Dr. Rebel A. Cole, a professor of finance at DePaul University in Chicago.”But that won’t matter if you don’t follow up when people fall behind.” To improve cash flow, consider offering a discount for cash on delivery or taking credit cards over the phone.

5. It isn’t only for your down periods.

Many seasonal or cyclical businesses only focus on cash flow during seasons when sales are down. Smart companies monitor tools and financing practices that keep good working capital practices year-round, which can lessen the impact of the down periods. “If you only worry about working capital when you’re cash-strapped, you will become cash-strapped,” Cole says.

 


Everything You Need to Know About the Small Business Administration

As a small business owner, you’ve probably heard of the Small Business Administration (SBA) – in passing, at the very least. For most people, SBA loans are the first thing that comes to mind. The SBA is one of the largest loan backers to small business owners in the country. The reality? they have a lot more to offer than you think.

Curious? Good. Here you’re going to get an overview of the SBA. But, you’ll also see what it does and how it can help you grow your business.

What is the Small Business Administration?

The SBA is a United States Government agency. Created post-World War II, the SBA wanted to encourage and support America’s small business owners. They wanted to help boost the economy. The guiding principles of the SBA are the same today as they were at the very beginning.

As stated on its website:

“The U.S. Small Business Administration helps Americans start, build, and grow businesses.”

Préstamos de la sba might be the most well-known of the agency’s programs. But, the SBA also provides business counseling, disaster loans, federal government contracting, and other tools to help small business owner. Getting in touch with the SBA is easy. Its main campus is in Washington, D.C.. But they have dozens of offices across all 50 states and U.S. territories. Many of these offices host local events and in-office programs for small business owners to attend.

Small Business Administration Programs

The SBA runs a variety of programs that small business owners can take advantage of to grow their business.

Préstamos de la SBA

Access to capital is one of the biggest struggles many small business owners face. SBA loans are a primary source of funding for tens of thousands of small business owners across the country. In the 2019 Fiscal Year, the SBA reported over $28 billion through approximately 58,000 approved loans.

The primary SBA loans are the 7(a) and 504 programs. These loans are made through partner lending institutions with the SBA guaranteeing a portion of the loan. The SBA doesn’t directly loan to small business owners. The SBA 7(a) loan is the administration’s most popular. It provides up to $5 million in working capital at a low interest rate for business purposes. The SBA 504 loan provides up to $5.5 million. It can be used for real estate, equipment and other fixed asset purchases. While the 7(a) and 504 are the most popular programs, the SBA offers other financing options too.

They include SBA:

  • Microloans which provide working capital up to $50,000.
  • Disaster loans offer loans to businesses and homeowners who have been affected by nationally declared disasters.
  • Express loans have a quick 36-hour turnaround for approval.
  • Export loans provide capital for small businesses that have export financing needs.
  • CAPLines are lines of credit.
  • Veterans Advantage are loans for military veterans.

Each SBA loan program has specific terms, conditions and requirements. Be sure to check them before applying to any loans. Having a strong business plan and a good personal credit score are key factors for SBA loan applications as well.

Other SBA Financing Options

In addition to the loan programs above, the SBA offers a variety of other financing options for small business owners.

Small Business Grants

The SBA doesn’t offer small business grants directly. However, it does have a few programs that can help businesses focused on the cutting edge of innovation. These programs are the Small Business Innovation Research Program (SBIR) and the Small Business Technology Transfer Program (STTR). They offer grants for qualified businesses producing tech or science-focused research and development programs. These businesses will also have commercial potential.

Venture Capital

The administration also works with Small Business Investment Companies (SBIC), which invest in small businesses. While SBICs are independently owned and managed, the SBA provides oversight in terms of regulation, licensing, and funding.

Government Contracts

The U.S. Government is one of the biggest employers in the world. That’s good news for small business owners. The government has tens of thousands of contracts available at any given time. A portion of those are reserved for small business owners.

The SBA helps support small business owners when it comes to finding and securing government contracts. The administration even offers advice and guidance through online courses and in-person help. Topics include how to become a qualified government contractor.

The SBA also has specific programs to help Women-Owned Small Businesses (WOSB). They help Service-Disabled Veteran-Owned Small Businesses (SDVOSB). And, they even aid small businesses located in historically underutilized business zones. These businesses can be in the HUBZone program, to secure government contracts as well.

Small Business Services

The SBA also offers programs and services for small business owners that offer help to support and grow businesses. These programs are provided free of charge for small business owners.

PUNTUACIÓN

SBA’s Counselors to America’s Small Business SCORE program has chapters throughout the country. The program is comprised of a network of volunteers who serve as mentors to small business owners. SCORE program members can receive help with everything from creating a business plan to marketing. They receive help through in-person events, online courses and workshops.

Small Business Development Centers

The SBA also partners with many colleges and universities across the country to form Small Business Development Centers (SBDC). These centers work with local small business owners on a variety of training and development programs.

SBA Learning Center

Through its online learning portal, the SBA offers dozens of free courses. They cover everything a small business owner would want to know. Classes range from Social Media Marketing, to Accounting 101. All courses are free.

Other Outreach Programs

Additionally, the SBA also has a vested interest in helping women, veterans and minority business owners succeed. To that end, the administration has smaller outreach centers geared specifically towards these business owners. These programs offer a bit more specialized training and guidance.

Small Business Owners and the SBA

The bottom line? The Small Business Administration is a phenomenal resource for small business owners. They offer everything from classes and mentorship to a variety of funding options. The SBA strengthens the backbone of the American economy: small businesses and their owners.

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7 razones El financiamiento basado en activos podría tener sentido para su compañía de rápido crecimiento

Las empresas de rápido crecimiento pueden tener problemas para financiar una expansión. Pero el financiamiento basado en activos puede ofrecer ventajas sobre los métodos más tradicionales de préstamo de dinero. Esto es lo que necesitas saber.

Cómo funciona la financiación basada en activos.

Imagine que está dirigiendo una empresa de indumentaria minorista y necesita efectivo para hacer crecer su negocio. En lugar de solicitar un préstamo basado en el historial crediticio de la empresa, en lugar de eso, puede solicitar un financiamiento garantizado por el inventario que posee. Los minoristas de ropa generalmente tienen niveles significativos de inventario (vestidos, jeans, etc.) que pueden usarse como garantía de préstamo.

Muchos minoristas también operan como mayoristas para empresas más pequeñas y, por lo general, tienen facturas pendientes de pago pendientes. Las empresas también pueden usar esas facturas para ayudar a financiar sus propias operaciones al contratar a un intermediario conocido como factor. El factor compra las facturas con un descuento a cambio de proporcionar efectivo inmediato.

Aquí hay siete razones para considerar el financiamiento basado en activos.

¿Cuáles son los beneficios de la financiación basada en activos?

Cuando se compara con las formas tradicionales de préstamo, el financiamiento basado en activos puede ofrecer una amplia gama de beneficios, desde menos restricciones hasta ahorros de costos y menos papeleo. Si bien no es la mejor opción para todas las empresas, tiene sentido incluirla como parte de su diligencia debida al seleccionar el mejor producto de financiamiento para su empresa.

Aquí hay siete razones para considerar el financiamiento basado en activos.

1. Costos potencialmente más bajos

Los préstamos basados en activos son préstamos garantizados. Y, por lo tanto, puede ser mucho más barato que los préstamos tradicionales, que generalmente se basan en el historial financiero de la compañía. Si un préstamo se basa únicamente en el historial crediticio de una empresa, se considera un préstamo no garantizado. Como tal, al prestatario se le cobrará una tasa de interés más alta. Esto se debe a que el banco puede estar asumiendo más riesgos cuando hace un préstamo sin garantía.

Las estructuras de préstamos asegurados y no garantizados son similares a los préstamos de consumo, ya que los préstamos hipotecarios pueden ser más económicos que las deudas de tarjetas de crédito. Con un préstamo hipotecario, si no paga su hipoteca, el banco puede recuperar su casa; sin embargo, con la deuda de la tarjeta de crédito no suele haber un depósito de seguridad que respalde el préstamo.

2. Menos papeleo

Si bien obtener un préstamo comercial tradicional puede requerir que documente el historial financiero de las operaciones de su empresa, un préstamo basado en activos probablemente no lo haría. En otras palabras, pedir prestado contra el valor de su inventario podría ser una forma más fácil para que una empresa más nueva obtenga financiamiento que tratando de obtener un préstamo tradicional.

3. Menos restricciones que los préstamos tradicionales.

Muchos préstamos tienen restricciones sobre cómo se utiliza el dinero del préstamo. Por ejemplo, un banco puede preguntarle por qué necesita un préstamo convencional (también conocido como préstamo a plazo porque se otorga por un período específico) y cómo piensa reembolsarlo. Si obtiene un préstamo a plazo y le dice al banco que quiere usarlo para remodelar sus tiendas minoristas, así es como el banco espera que use los ingresos. La buena noticia es que los préstamos basados en activos suelen tener menos restricciones de uso.

4. Condiciones de pago más flexibles

Eventualmente deberá devolver cualquier préstamo al prestamista. Sin embargo, no todos los préstamos son creados igualmente. Los préstamos basados en activos a menudo no requieren que el monto total del préstamo se pague de acuerdo con un calendario fijo, a menudo conocido como un calendario de amortización. Los pagos a plazo del préstamo (incluido el pago del saldo del capital) deben pagarse cada mes. Los préstamos basados en activos suelen tener condiciones de pago más flexibles, lo que permite a las empresas pagar la deuda en el momento más adecuado dado su flujo de efectivo. El resultado es potencialmente una mayor flexibilidad para las empresas que utilizan financiamiento basado en activos.

5. Hojas de balance simplificadas

Si obtiene un préstamo tradicional, el saldo adeudado aparecerá en su hoja de balance. Algunos fondos basados en activos no se registran de esa manera. Por ejemplo, si vendió sus facturas pendientes a un factor a cambio de efectivo inmediato, no habría saldo que mostrar en el balance de su empresa. Todo lo que debe hacer es anotar cómo gestionó esta transacción financiera en una nota a pie de página en los estados financieros. Esto se conoce como Financiamiento fuera de balance.

6. Una buena forma de financiar capital de trabajo.

Las compañías que experimentan un rápido crecimiento pueden tener dificultades para obtener capital de trabajo adicional a través de líneas de crédito revolventes. En el mismo sentido, a medida que aumenta la necesidad de capital de trabajo, su empresa puede tener mayores niveles de inventario y mayores facturas por parte de los clientes. Puede usar el inventario y facturas más grandes como garantía para financiar mayores necesidades de capital de trabajo.

¿Se siente más seguro de su negocio para comprar un préstamo? Antes de empezar a buscar debes entender ¿Qué factores afectan los términos de sus préstamos?.


5 cosas a tener en cuenta al solicitar subvenciones para pequeñas empresas

Cuando eres un pequeño negocio, el efectivo es el rey. ¿Pero sabes qué es aún más grande y mejor que el efectivo? ¡Dinero gratis! Sin embargo, a menos que sea un bebé de fondos fiduciarios o que tenga la suerte de ganar la lotería (una mala inversión por cierto), entonces es difícil conseguir dinero gratis. Aparte de los dos métodos mencionados anteriormente o de un tío rico, su principal opción para obtener efectivo gratis son las subvenciones para pequeñas empresas.

Aunque no te emociones demasiado

Las subvenciones para pequeñas empresas tienen sus pros y sus contras. Por lo general, el dinero gratis es algo bueno, pero ten en cuenta que hay algunos problemas que vienen con cosas "gratuitas". Entonces, antes de decidir que esta es la mejor opción de financiamiento para su pequeña empresa, veamos más de cerca.

En primer lugar, ¿qué es una subvención para pequeñas empresas de todos modos?

Piense en una beca como una beca para pequeñas empresas. Por lo general, provienen de gobiernos federales, estatales, del condado o locales, pero a veces las empresas o corporaciones privadas también los ofrecen. Al igual que una beca, hay un montón por ahí, y por lo general se reservan para "personas" que cumplen con ciertos criterios. Algunos son para compañías en línea, otros para veteranos, otros para mujeres y / o empresas pertenecientes a minorías. La lista sigue y sigue, y todos tienen diferentes requisitos de aplicación.

Aquí está la clave para obtener una subvención para pequeñas empresas.

Todo se reduce a la investigación. Hay miles de subvenciones disponibles por ahí, pero sus posibilidades de obtener una realmente se reducen a dos cosas: cuánto trabajo pondrá para encontrar una para la que califica y cuánto trabajo está dispuesto a hacer durante todo el proceso de solicitud. . ¿Estás viendo un tema aquí?

Vamos a ponerte al día en el proceso.

Un buen lugar para comenzar es el sitio web de Small Business Administration en www.sba.gov. Aquí es donde encontrará mucha información útil para comenzar su búsqueda. Nuestro mejor consejo es guardarlo en sus favoritos y simplemente explorar el sitio. Hay mucha información para consumir.

A continuación, intenta ir a www.grants.gov. También es un sitio web federal que le permite buscar subvenciones gubernamentales disponibles. Solo asegúrese de asegurarse de que es elegible para una subvención antes de pasar demasiado tiempo solicitando.

Por último, es una buena idea consultar la página web oficial de su estado. Muchos estados ofrecen no solo subvenciones a pequeñas empresas, sino también incentivos fiscales y otros incentivos económicos para que usted traiga empleos al estado.

¡Ahora hablemos de lo que necesita saber al comenzar su búsqueda de dinero gratis! Y para ser totalmente honesto, algunos de estos factores pueden superar los beneficios del dinero gratis. Entonces, para asegurarte de que entras en esto con los ojos bien abiertos, comencemos.

1. ¡Las subvenciones para pequeñas empresas consumen MUCHO tu tiempo y el de tu personal!

Como la mayoría de los procesos gubernamentales, obtener una subvención del gobierno federal o incluso local requiere mucho tiempo. Es importante entender cuánto vale su tiempo y luego evaluar cuánto está ganando en comparación con el tiempo que le llevará obtener el dinero. Hay una gran cantidad de papeleo y una gran cantidad de documentación requerida / informes de mercado / informes demográficos / etc que harán que su personal salte a través de aros. Solo asegúrese de que todo vale la pena antes de dedicar todo ese tiempo, es decir, el tiempo que podría gastar en su propia estrategia de crecimiento o desarrollo empresarial.

2. No esperes el dinero pronto.

Como mencionamos en la primera sección, recuerde que este es el gobierno con el que estamos tratando aquí. No esperes que las cosas se muevan rápidamente. Una vez que envíe su solicitud, pueden pasar semanas, o incluso meses, antes de recibir una respuesta o averiguar si está aprobado. Sí, es frustrante, pero si entiendes que eso es parte del juego, no perderás tanto sueño por eso.

3. ¡La competencia para las subvenciones para pequeñas empresas es dura!

Esto es dinero gratis de lo que estamos hablando aquí. No serás el único que lo solicite. Los más brillantes y los mejores tendrán a sus equipos trabajando para obtener este dinero, así que prepárate para una competencia feroz. La clave es conocer sus puntos fuertes y saber cómo puede presentar su negocio de la mejor manera posible. ¡Muéstrales por qué te lo mereces más que nadie! Y otra cosa ... asegúrese de solicitar subvenciones que se ajusten a sus fortalezas como empresa. Eso mejorará significativamente tus posibilidades.

4. Las becas vienen con cuerdas unidas.

Si tiene la suerte de ser uno de los pocos beneficiarios de subvenciones, recuerde que esto generalmente viene con cadenas. Prepárese para sacrificar un poco la privacidad y comprenda que tendrá que hacer un mejor trabajo para mantener su "casa en orden". A muchos emisores de subvenciones les gusta revisar su progreso. A menudo, esto significa "check ins" mensuales o trimestrales en los que le pedirán una prueba de que cumple con los requisitos descritos en su subvención. Además, puede haber otras cadenas como los acuerdos de contingencia. Los programas estatales y locales de IE le darán el dinero contingente de los fondos correspondientes o un préstamo para complementar la subvención.

5. Las subvenciones para pequeñas empresas pueden no ser el dinero que desea.

Las subvenciones por lo general vienen con reglas sobre para qué puede usar el dinero. Si crees que es una tarjeta libre de deudas, piensa otra vez. Las subvenciones federales y estatales se financian con dólares de los contribuyentes, por lo que hacen todo lo posible para garantizar que se utilicen con fines que beneficien a la comunidad en general y no solo para pagar las deudas de su empresa. (Quieren más empleos, tecnología mejorada, etc.) No es un préstamo. Es generalmente un regalo para un propósito específico.

Envolviéndolo todo.

Las subvenciones para pequeñas empresas pueden ser oportunidades increíbles para su negocio, pero también pueden ser depósitos de dinero que no tienen el ROI que imaginó cuando escuchó la palabra "¡DINERO GRATIS!" Para determinar si son adecuados para su negocio, investigue un poco. y tenga en cuenta todos estos factores. ¡Ahora que estás informado, tomarás la decisión correcta!


How to Strengthen Your Balance Sheet to Qualify for a Loan

Admittedly, some business owners neglect to review their financial statements monthly. Some, actually, only review financial statements yearly–and only for tax purposes! If you want a true ideal picture of your company’s financial health, you absolutely need to regularly monitor your financials, including your balance sheet. While lenders want to see that your firm is profitable, they are most concerned with whether or not you have sufficient working capital, a manageable debt to equity ratio and a strong operating history. Since your balance sheet provides all this information and more, you will definitely want to strengthen your balance sheet if you are seeking a loan.

Increase your working capital.

The more cash or assets you have readily on hand that can be converted into cash to pay your current obligations, the lower the risk you will default on a loan. In other words? Lots of cash and equivalents encourage a lender to lend. Working capital is short-term assets less short-term liabilities. Short-term assets include cash and cash equivalents as well as inventory and receivables. Short-term liabilities include all payables. Hence why lenders focus on working capital.

However, your working capital calculation can significantly differ from the lender’s. Lenders will drastically discount older current assets. If your inventory does not have quick turnover (this timing varies by industry), then lenders will discount its value from what shows on your balance sheet. Furthermore, if you are in an industry with shorter inventory lifespans such as retail and you have unsold inventory that is over two years old, when you sell it, you likely will only get a fraction of what you paid for it. Obviously, lenders cannot count on that cash for bill payment. They will thus exclude that inventory from your firm’s working capital calculation. The same applies to receivables. If your receivables are due in 30 days but 40 percent are over 90 days old, the lender will completely ignore that 40 percent. The exceptions are slow-paying industries such as industrial construction.

Since your old inventory and receivables will be totally excluded by lenders in their working capital calculation, convert those assets to cash. The cash will be included. Sell off your old inventory. Vigorously pursue all overdue receivables. To ensure your inventory turns over in a reasonable amount of time, only buy what sells or ramp up your marketing efforts. To square up your receivables within 30-day terms, create and implement strong accounts receivable and credit policies.

Decrease your debt.

Lenders look at your overall debt, your interest-bearing debt or both, compared to your equity. A high debt burden could mean trouble. Acceptable debt to equity ratios vary by industry. A capital-intensive industry like manufacturing will require much more capital investment than a services-oriented industry like marketing firms.

If you have unused or chronically underused equipment, strongly consider selling it. The purpose of an asset is to help produce or deliver the goods or services your firm provides. If a large asset is just sitting there, it is not fulfilling its mission. Not only will selling reduce your debt, it will convert the associated asset from PP&E to cash on the balance sheet. Although both are assets, the additional cash is much more powerful because it increases your working capital. Remember, working capital indicates your firm’s ability to repay debt in the near term.

Increase your equity.

The lender wants to see that your company has a profitable history. She also wants to know that you reinvest in the company. Why? That shows you both believe in your firm and expect it to grow. Therefore, the owner’s equity piece is very important. Do you retain a sizable portion of the earnings or do you pull every last dollar out you can? If it’s the latter, stop. Your owner’s equity needs to be high enough to be compelling.

One way to both decrease debt and increase owner’s equity at the same time is to convert any shareholder loans to equity. Owners often provide loans to the company instead of injecting equity capital for several reasons. The most notable reason is that you can receive a loan repayment of principal tax-free. But, you must pay taxes on any distributions received. However, if you are seeking funding, a strong balance sheet trumps your lower taxes. Make that conversion and immediately strengthen your balance sheet.

Reviewing your financial statements is important as they serve as the barometer of your firm’s financial condition. This is especially true of the balance sheet. If your firm is in expansion mode, use one or more of these suggestions to proactively strengthen your balance sheet to qualify for a loan.

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The Ins and Outs of Equipment Leasing

Suppose you need expensive equipment to run or grow your business. If you pay cash for it, your employees’ paychecks would bounce. Equipment leasing might be the rescuing you need.

1. What is Equipment Leasing?

Equipment leasing is a payment strategy accounting for around one-third of all equipment in use, from desktop computers to jumbo jets. “Evidence suggests,” according to the Commerce Finance Institute (CFI), “that an origin of leasing may have started… in the ancient Sumerian civilization.” Leasing has since evolved into an accessible financial resource.

The CFI defines an equipment lease as “a contract for the use of a piece of equipment over a specified period of time where the user of the equipment becomes the lessee and agrees to make periodic payments to the lessor of the equipment with specific end of term options.” In other words: you’re renting the equipment. Unlike renting a home, for example, the opportunity to buy the equipment outright when you enter the lease, is typically an option.

The accompanying illustration provides a breakdown of the categories of equipment leased today, and their share of the leasing universe. In the following pages we will explain when, why and how it is done.

https://www.elfaonline.org/data/market-trends/facts-about-industry-sectors (NEED TO CREATE AN IMAGE FROM THIS ARTICLE – BA)

2. When Should I Lease Equipment?

Before you begin to think of different ways you can bring in new equipment, whether by leasing, borrowing or even paying cash, give the idea a reality check. Ask yourself the same questions that a leasing company or a lender will probably ask you:

  • Will the equipment meet an important business need that’s currently unmet?
  • Does the cost of continuing to use the equipment I already have, in repairs and/or inefficiency, justify the price of acquiring new equipment?
  • Is now a good time to get new equipment due to special “deals” in the market?
  • How does the new equipment fit into my overall business plan?
  • If I wait a little longer before bringing in new equipment, might more advanced models become available that will give my business more bang for my buck?
  • What is my expected return on investment?
  • Do I have adequate free cash flow to enter a lease agreement without needing to sacrifice more urgent spending priorities today or down the road?

Another important consideration pertains to your company’s tax situation. With an “operating lease,” you are unable to take advantage of an important tax code provision known as Section 179. That benefit is available to companies using a different kind of lease known as a “capital lease.” It’s also available to companies that buy equipment through borrowing.

If you haven’t payed a lot of business taxes lately and don’t expect to soon, you won’t get the full benefit of Sec. 179. It could make sense to use an operating lease. That way, the lessor—the company you lease the equipment from—gets that tax benefit. This helps you because the lessor takes into account the tax benefits factors when deciding how much to charge.

3. What’s The Difference Between Leasing Equipment And Financing Equipment?

When you lease equipment, you’re essentially renting it. Equipment “financing” means you buy equipment with money borrowed from a lender. You own the equipment. There are advantages and disadvantages to both approaches.

A third way to obtain business equipment is buying it outright without borrowing or leasing.

4. What Are The Pros And Cons of Financing?

Equipment financing pros:

  • If you have a strong balance sheet and profitability, you might be able to obtain a very competitively priced loan to purchase the equipment at a lower total cost than leasing. Having the purchased equipment as collateral for the loan already makes the loan less risky for the lender than an unsecured loan. A strong balance sheet makes you more attractive to lenders.
  • Depending on your financial strength, you might be able to borrow all of the money you need to buy the equipment without a down payment.
  • As the owner of the financed equipment, you may be able to claim tax benefits such as Sec. 179 and deductions for loan interest.
  • With a loan, you have the option to pay the principal balance off if you want to–without penalty. This allows you to reduce the total interest you pay, and ultimately, the cost of getting the equipment.
  • If you own the equipment and can pay off the loan, you can dispose of the equipment at your discretion.

Equipment financing cons:

  • Borrowing to purchase equipment could limit your ability to borrow for other purposes, if lenders believe you’re assuming too much debt.
  • An equipment loan appears as a liability on your balance sheet.
  • Depending on the size of your down payment for the equipment, the lender might need more assets to secure the loan than just the equipment being financed, possibly including personal assets. The equipment might depreciate faster than the amortization schedule for paying off the loan.
  • The equipment could be obsolete before you pay the loan off.

5. What Are The Pros and Cons of Leasing?

Equipment leasing pros:

  • For companies of average or even sub-par financial standing, equipment leases are generally easier to obtain than loans.
  • It is often easier to obtain equipment via leasing without having to put any money down, than with a loan.
  • The only “security” you need to pledge is the equipment itself—which technically isn’t yours anyway since you’re borrowing it from a lessor.
  • Leasing equipment is known as “off balance sheet financing.” At least with an “operating lease,” the liability associated with your lease obligation isn’t reported as a liability on your balance sheet. Also, lease payments are treated as operating expenses–and tax deductible.
  • At the end of the lease term, which should coincide with the time you want to replace old equipment with newer models, selling or otherwise disposing of it isn’t your problem. You just return it to the leasing company. This is helpful with high-tech equipment which becomes obsolete more quickly than other equipment, and thus more difficult to sell.
  • Flexibility is a hallmark of leasing. There are many ways to structure a lease agreement.

Equipment leasing cons:

  • Because the leasing company is typically assuming greater credit and technology obsolescence risk rather than a lender making a loan to a financially strong company, lease payments often have a higher built-in cost structure than loans.
  • You are obligated to make all of the payments prescribed by the lease contract. You typically cannot pay it off ahead of the original schedule. Or if you can and want to, you would incur a large financial penalty.
  • Many lease agreements place the burden on you to pay for certain repairs and maintenance services.

6. What’s Involved In Entering A Lease Agreement?

The first decision you’ll face, after you decide on the equipment, is what kind of a lease agreement suits your needs. You’ll probably have several options, you just need to figure out which is best for you.

What can you really afford? While a leasing company makes its own judgments about that, you might want to be more conservative in the appraisal of your financial capacity. This will give your company plenty of breathing room for future financial needs.

Another task associated with entering an equipment lease agreement is which leasing company to work with (see Section 10). Some equipment manufacturers have their own “built-in” leasing companies. But, you owe it to yourself to be sure you’ve found the best deal before signing on the dotted line.

The final step in the process is persuading a lessor that you’re the kind of company with which it wants to do business. That may involve turning over reams of financial documents, along with good explanations of why you need the equipment and what it’ll do for your business. The process is like applying for a bank loan. However, it will probably be less rigorous since you aren’t borrowing money. You’re simply paying rent on property that you don’t own.

7. What Are The Main Categories of Equipment Leases?

There are two basic kinds of equipment leases: capital and operating. With a capital lease, you’re treated (for tax purposes) as the owner of the leased equipment. That means you can take depreciation deductions or, if you’re eligible, a Section 179 deduction. With an operating lease, you are treated more as a renter than an owner, and not eligible for that tax benefit. The only tax benefit is that lease payments are tax deductible.

Under Section 179 of the Internal Revenue Code, you are able–in 2019–to take a deduction for up to $1 million in equipment acquisition by purchase or through capital leasing. There are strings attached, however. You’re only eligible if a) you don’t acquire more than $2.5 million of equipment in that year (although you might still be eligible for a partial deduction) and b) the equipment is used at least 50% of the time for your business.

The Section 179 deduction is phased out dollar for dollar, for every dollar your equipment acquisitions exceed $2.5 million. For example, if you acquire $2.7 million in equipment, your maximum Section 179 deduction would be $800,000. The kinds of equipment eligible for deductions are restricted.

Any of the following criteria must be met in order for a lease to be treated as a capital lease.

  • You automatically become the owner of the leased property at the end of the lease term.
  • You have the option to purchase leased property at a subsidized price.
  • The lease term is long enough to cover at least 75 percent of the “useful life” of the equipment.

8. What Are Some Subcategories Of Leases?

Under a capital lease, there are several subcategories. The most expensive (in terms of monthly payments) is the $1 buyout lease. You have the option to buy the leased equipment for $1 at the end of the lease term. In effect, you’re buying the equipment over the lease term, since the lessor is prepared to turn it over to you at that time for the price of $1.

This type of lease may be the easiest to qualify for as the lessor is getting more money from you. You might not want to use a $1 buyout lease unless you plan to buy the equipment, and expect to use it for years to come.

Another common capital lease is the 10 percent option lease. As the name suggests, it gives you the option to buy leased equipment for 10 percent of the original value when the lease is up. Your monthly payments might be lower than the $1 buyout lease since you’re only paying for 90 percent of the equipment. Yet, the interest rate the lessor uses to calculate the payment might be higher, because it’s assuming the risk that you’ll decide not to buy the equipment at the end of the term.

A variation on the 10 percent option lease is the 10 percent “purchase upon termination” (PUT) lease. You’re obligated to purchase the equipment for 10 percent of the original equipment cost when the lease is up. This is more of a financial risk to you, thus giving you lower monthly lease payments. Of course, you have to come up with the cash simultaneously.

What are the terms?

Terms for a standard operating lease, in which there are no special tax benefits (beyond writing off lease payments), is the FMV lease. It gives you the option of purchasing leased equipment for its fair market value (as set by the lessor) at the end of the lease term, return the equipment or renew the lease. It’s an operating lease because it’s more like a simple rental arrangement. Lessors set approval standards highest for FMV leases.

A fifth lease category, known as a TRAC (Terminal Rental Adjustment Clause) is a hybrid contract. Depending on specifications, it can be a finance or an operating lease. They’re used primarily for commercial vehicle leases.

9. How Much Does Leasing Cost?

The cost of leasing equipment varies. These are the factors determining the cost:

  • The value of the equipment
  • The competitive state in the market of lessors that specialize in companies like yours
  • The interest rate environment
  • The way credit and obsolescence risk are allocated between you and the lessor
  • The assigment of which party gets the tax benefits

Also critical is your credit history. In a perfect world, the stronger your credit score is, the lower your lease payments will be. You can find lease payment calculators online to give you ballpark numbers for your own leasing situation.

10. How Do I Decide Which Equipment Leasing Company Is Right For Me?

When you start looking for an equipment lessor, you’ll find four kinds:

  1. A company that just puts together equipment leases.
  2. A “captive”: a subsidiary of a company making costly equipment.
  3. A financial institution offering equipment leasing among a variety of other financial services.
  4. A lease broker, who helps you find a suitable lessor.

Considering the long-term financial commitment involved, shop around. Your best bet might be a leasing company that specializes in working with companies like yours, and / or specializes in the kind of equipment you want to lease. Getting competitive terms is important, but so is the strength and integrity of the leasing company.

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