Tag: Business

The Disadvantages of Working from Home: 5 Things to Consider When Using Your Home Address for Your Business

Working from home has many advantages. One of the easiest ways to start a business is to start it from your own home.  It’s the most natural way to start for many.  Whether you are baking, woodworking, offering a service, or anything else, doing so out of your house has many advantages. What isn’t discussed as often are the disadvantages of working from home. 

5 Surprising Disadvantages of Working from Home

Most business owners just assume that if they are running their business from home, their home address and their business address will be one and the same.  That’s fine, but what if you decide to move out of your home?  Changing business address can cause issues. This is just one of many surprising disadvantages of working from home.

Disadvantages of Working from Home #1:  Your Home May Not Be Conducive to Productive Work

A home may not necessarily be well equipped to handle working. You need a workspace that will help you be productive.  This will be different for everyone.  But, consider that you at least need a room with a door you can close.  Drawing boundaries between home life and work life can be hard.

Learn more here and get started with building business credit with your company’s EIN and not your SSN.

Managing time can be harder when working from home as well. It can be easy to work all day when you are at home, or not work enough due to “home” distractions. It’s hard to get people to respect your time and boundaries. Also, isolation and depression are not uncommon. 

Disadvantages of Working from Home #2: You May Not Be Allowed to Run Your Business From Your Home

In some situations, you may not be allowed to run your business from your home. If you rent, you will need to check your lease to make sure there are no issues. Whether you rent or own, you need to check zoning requirements. Also, agencies like the Health Department and the FDA have guidelines related to running certain types of businesses from your home. 

Disadvantages of Working from Home #3: Home Address on Public Record

Many people worry about their home address as their business address.  They feel it is unsafe, so they turn to a PO Box or an UPS Box. However, that can make it difficult to get funding.  Lenders require a physical address.  

This is a unique disadvantage of home-based businesses.  Even home based businesses need funding for a number of things: 

  • Supplies
  • Inventory
  • Equipment (for jewelry making, woodworking, computer/ office equipment, etc.)
  • Even working capital

One option is to use a virtual address.  Be aware however, that some lenders will not accept those either.  The truth is, if someone wants to find your home address, it’s easy enough regardless of whether you use it as your business address or not.  In the end, to get funding for your business you are going to need to use a physical business address where you an receive mail.

Learn more here and get started with building business credit with your company’s EIN and not your SSN.

Disadvantages of Working from Home #4: Changing Your Business Address Later Can Cause Problems

You may think you can get by with using your personal address now, and just change it later. That’s not a good idea. If you think about it, your business address goes everywhere.  For example: 

  • All legal documents
  • Licences
  • Marketing materials
  • Your website
  • Insurance papers
  • Everywhere!

The longer you wait, the more places you will have to remember to change it. It is a bigger deal than you may think if you miss one. If lenders start looking into your business and see your business address is listed differently in different places, it can cause unnecessary issues. It brings up fraud concerns. 

A bank will not take the time to try to figure out all the different ways a business may be listed. Even something as simple as using Street vs St, or using an ampersand in one spot and the word “and” in another can cause issues. So you can imagine using your home address in one spot and a separate business address in another will definitely cause problems. 

That doesn’t mean that if you move your business out of your home you have to keep your home address.  Just be aware that you will need to make sure the address is changed everywhere.  

Disadvantages of Working from Home #5: Legal Issues

There are a number of legal considerations that you have to think about when it comes to running a home based business. For example, even if zoning laws allow you to run your business from your home. You need to check out what requirements those laws lay out. Some cities have regulations regarding foot traffic. Some even regulate yard sign use for advertising. And if you have an Homeowners Association (HOA) you may need their permission as well.

Learn more here and get started with building business credit with your company’s EIN and not your SSN.

Some cities limit the number of employees a home based business can have. Some even regulate the number of customers that can come to your door. You’ll need to check with your local city officials to determine what if any regulations apply to you. And figure out what licences and permits you need to operate.

Consider the tax issues as well. While you can deduct some expenses when it comes to home-based businesses, it can get complicated. You need to make sure you thoroughly understand the home business deduction on the front end and plan accordingly. 

Insurance needs to be considered as well. If you have employees or customers coming in and out, you need to think about what would happen if they were injured. Will homeowners’ insurance cover it? Often you will need to purchase a separate policy or a rider. All insurance needs to be in place on the front end.  Be sure it has the proper business address on it!

Avoid Many Disadvantages of Working From Home 

Nothing is perfect. Running a business from your home is no different. However, you can avoid many of the disadvantages of working from home by building fundability from the beginning.  Not only will it help with legal issues, but it makes a bigger difference than you may think when it comes to funding.  

The best way to start building fundability, whether you own a home-based business or run a business from a different location, is to work with a business credit expert. Contact us today for a free consultation.

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3 Surprising Reasons Why It’s So Important to Get Business Permits and Licenses

Business Licenses and Permits – Are They Really Necessary?

While not every company needs to have business licenses and permits, it’s still vitally important to check. Make sure because there are consequences to not having licensing.

Check out why business licenses and permits matter. And along the way, get specifics on licensure in North Carolina, Massachusetts, Florida, and Washington State.

Reason #1: Why Does a Business Need Licensing?

According to LegalZoom, A business license is a government document that certifies a business is safe for the public. Exactly which kinds of licenses you require depends upon the kind of business you operate and where you operate it.”

Licensing is also a form of revenue for states, cities, and counties. But no matter how much profit a jurisdiction may get from providing licenses, licensure is still rooted in public safety.

Reason #2: Why Does a Business Need Permits?

According to Chron, “Business permits regulate safety, structure and appearance of the business community. They act as proof that your business follows certain laws and ordinances. Requirements vary by jurisdiction, and failure to comply often results in fines or even having your business shut down.”

Permits can be related to tax collections. They can also be related to zoning laws, which can be for public safety. For example, you probably can’t open a cattle feedlot or a chemical processing plant in a residential area

Applying for Variances

If you cannot, or do not want to, comply with a local ordinance, you can petition for a special permit called a variance. A variance essentially gives you permission to violate an ordinance. These are rarely granted and can be expensive due to legal fees. So make sure you need one before you request it.

Reason #3: Check Out What Happens if you Operate Without Business Licenses and Permits

So if a license is required, then get one. If you don’t, you could be forced to close. You may have to pay a fine. Your business could have to go through a probationary period before being allowed to reopen. The licensing authority (city, state, etc.) could refuse to grant you a license. Or your business could experience any combination of these.

If you don’t have a license, you could be sued for fraud. This is because it’s a misrepresentation if you open your doors without a license. After all, the public is reasonably expected to believe you have all necessary permits and licenses.

Your business reputation could take a tumble. Because customers may feel if you won’t follow the law, you won’t follow their directions, either. You could scare off prospects. As they might see your business as being fly by night.

So is it really worth it to not have licenses and permits? You should already know the answer to that.

Consider This: Licenses, Leases, Permits, and Registrations Are All on a Calendar

These all need renewal on a regular basis, so keep track of those dates. Keep a copy of all applications and forms in your business records. Make sure you follow all rules for displaying licenses and permits.

Most places require you to display the license prominently for your customers. Check to see if you need additional licenses before expanding your building, launching a new product, or offering a new service.

Consider This: Recordkeeping

When we talk about fundability, one of the areas we stress is keeping consistent records. Hence in addition to keeping track of renewal dates, you should also make sure all licenses, permits, etc. have the exact same business name, address, phone number, etc. And if any of these basics change, be sure to update all of these documents.

Learn more here and get started with building business credit with your company’s EIN and not your SSN.

Which Types of Federal Business Licenses Do You Need?

If a federal agency regulates your business activities, you will need a federal license. According to the Small Business Administration, businesses in the following industries will need a federal license:

  1. Agriculture
  2. Alcoholic beverages
  3. Aviation
  4. Firearms, ammunition, and explosives
  5. Fish and wildlife
  6. Commercial fisheries

These industries are also included on the list of industries that must have federal licenses:

  1. Maritime transportation
  2. Mining and drilling
  3. Nuclear energy
  4. Radio and television broadcasting
  5. Transportation and logistics

Which Types of Local Business Licenses Do You Need?

Local business licenses come from your state or city. They are determined by local laws. Federal licenses pertain to certain kinds of business activities. But a local business license means adhering to your state’s specific business regulations. To set up your business license, you often have to have a commercial address that must be a licensed business as well. You increase your chances of rejection if you use a non-licensed business as your address.

Which Types of State Business Licenses Do You Need?

States have various requirements. As a result, the rules for one will not necessarily apply to another. Here are a few example states to give you an idea of what’s needed, and where to get licensing.

Business Licenses and Permits in North Carolina

North Carolina does not have a generalized license to cover all bases. You’ll need to check your specific industry. The North Carolina Department of Commerce keeps the North Carolina Business & Occupational License Database. There are hundreds of business, occupational, and privilege licenses issued in North Carolina.

Some sample occupations that require licensing include:

  1. Truck Driver School Recruiter
  2. Asbestos Accreditation
  3. Certified General Real Estate Appraiser
  4. Kerosene Supplier

Business Licenses and Permits in North Carolina Cities Like Charlotte

Cities have their own licensing requirements. For example, in Charlotte, you will need to visit Charlotte Business Resources. The Licensing and Permitting page has a wealth of information on getting licenses not just in Charlotte, but also Mecklenburg County. The page answers basic questions on taxes and other topics of interests to business owners.

Learn more here and get started with building business credit with your company’s EIN and not your SSN.

Business Licenses and Permits in Massachusetts

In the Bay State, the Division of Professional Licensure (“DPL”) is an agency within the Office of Consumer Affairs and Business Regulation.

Collectively, DPL boards and offices license and regulate over 150 trades and professions in Massachusetts.

From the Massachusetts government website page on the DPL, you’ll need to click on the board governing the appropriate industry to get more information on the licensing you’ll need.

Get a Business License in Mass.

There is also a topic page on the Massachusetts government website all about professional licenses and permits. From that page, you can learn about licensing requirements and laws governing basic professional categories such as:

  1. Health care
  2. The building trades
  3. Cosmetology

Getting a Business License in Massachusetts Cities Like Boston

In the city of Boston, the city’s website has a section on small business development. The Licensing Board issues and regulates licenses for alcohol, food, and lodging in Boston. The Consumer Affairs and Licensing Division licenses entertainment for restaurants and nightclubs. When it comes to liquor licenses, in some instances you will have to meet with the Neighborhood Association before a Board can proceed.

Business Licenses and Permits in Florida

On the My Florida License website, you can click on the names of several industries to learn all about their licensing requirements. These industries include:

  1. Electrical contractors
  2. Harbor pilots
  3. Certified public accountants (CPAs)

Get a Business License in Florida Cities

Many Florida cities have licensing requirements. For a list of Florida cities that links directly to their official websites, go to the Cities page at the State of Florida website. That website also has a Permits and Licenses page.

Business Licensing in Florida Cities Like Tampa

For example, the Tampa government website shows how to get construction permits in the city. Permits are required for, among other activities:

  1. Tree removal
  2. Adding or repairing/upgrading a pool or a spa
  3. The interior finishing of new construction

Business Licenses and Permits in Florida Counties Like Hillsborough

Florida counties have their own licensing requirements. For a list of Florida counties that links directly to their official websites, go to the Counties page at the State of Florida website. On that page, you can choose a county by name.

For example, for licensing information in Hillsborough County, go to the county website’s Apply page, then choose the Businesses tab. There you will find links to permits for activities such as:

  1. Fireworks displays
  2. Special events
  3. Doing construction, development, or utility work in the County’s Right-of-Way

Learn more here and get started with building business credit with your company’s EIN and not your SSN.

Business Licenses and Permits in Washington State

On the Washington State government website, go to the Department of Revenue page, and then to Open a Business, then to Apply for a Business License. You will need to register with the Department of Revenue and get a business license if you meet any of the following conditions:

  1. Your business requires city and state endorsements
  2. You are doing business using a name other than your full name legal name
  3. Or you plan to hire employees within the next 90 days
  4. You sell a product or provide a service that requires the collection of sales tax

You will also need to register with the Department of Revenue and get a business license if you meet any of the following conditions:

  1. Your gross income is $12,000 per year or more
  2. Your business is required to pay taxes or fees to the Department of Revenue
  3. Or you are a buyer or processor of specialty wood products
  4. Your business meets Nexus threshold reporting requirement

Business License in Washington Cities

For city licensing, go to the Washington State government website and look under Manage a Business, then City License Endorsements. There is a list of many of the cities and larger towns in Washington. However, it does not include all cities and towns.

To be thorough, Google the name of the appropriate city or town if it isn’t listed. Check their government website directly, just to be sure.

Business License in WA State Cities Like Seattle-Tacoma (SeaTac)

For example, if you click on the SeaTac link, there is information on a general business license. The City of SeaTac requires a license for all businesses located within city limits or conducting business within city limits.

If you are not sure if you will do business within the city limits, contact the city directly before you apply. Costs depend on the total number of full-time equivalent employees at your business.

Business Licenses and Permits: Takeaways

Business licenses and permits can be easy to overlook in your initial excitement at getting your business off the ground. But don’t ignore them! Failing to properly license a business can result in fines and other penalties. It can also cost you in business from customers and prospects.

Always check state, county, and city/town websites when it comes to licensing. Or call the appropriate government offices to be sure your business is fully and properly licensed.

For more help with setting up a business and making it the best it can be, make sure to contact us. And find out just what our Business Credit Builder has to offer.

The post 3 Surprising Reasons Why It’s So Important to Get Business Permits and Licenses appeared first on Credit Suite.

30 Great Franchise Business Ideas

If you’re a new entrepreneur looking for profitable business ideas with minimal risks, a franchise business can be a great place to start.

A franchise business carries the success, credibility, and popular associations of established brands, reducing the need for extensive marketing and brand building for you as a franchise owner. This can save you much time and money as you focus on making your business more profitable.

A franchise business model can also help you scale rapidly because you inherit the operation processes and framework from the licensing company.

Think about it this way: What would be easier?

Starting a company from scratch, working on branding, operations, funding, and marketing—or buying a license for a pre-established company?

In most cases, it’s the latter. That’s why entrepreneurs are so eager to buy into franchise businesses.

What Is a Franchise Business?

A franchise business is a licensing model of business where a successful company allows you to run a version of its business using its logo, processes, and in-house resources.

Think of the many fast-food stores you see worldwide.

These “franchise” businesses exist in multiple locations, selling the same products under the same branding, which helps build loyal customers and instant brand recognition. Some examples of worldwide franchises include McDonald’s, Domino’s Pizza, and Subway.

Option #1: Start a “Home Services” Franchise Business

Home service franchises offer services related to moving and housing. These work best for regional companies as most people prefer using local home repair and renovation services to save time and money.

Painting Franchise Business

As more and more houses are built every year, the demand for painters keeps growing. You can cash in on this growth by launching a painting franchise business.

Companies like CertaPro Painters let you start your own business under their name, so you can begin offering painting services using the CertaPro branding.

Great Franchise Business Ideas - Painting Franchise Business

Repair Services

No matter where you live, there is always a need for repairing services.

If you’re looking for a steady business with minimal market shocks, start a repair service franchise. This model is fairly stable because houses need recurring repairs—meaning you have the opportunity to develop long-term customers.

Some popular options include Paul Davis Restoration, Mr. Handyman, and 911 Restoration.

Moving Services

Another popular home service franchise business opportunity lies in the moving industry. Beyond moving series, these franchises offer temporary storage and junk removal services. You can find franchise business opportunities with companies like UNITS Moving & Portable Storage.

Although, it’s important to keep in mind that managing a moving business can be incredibly tricky because there’s a greater degree of responsibility involved.

House Cleaning Services

As the average citizen moves towards continuously busier lifestyles, the need for house cleaning services has grown significantly over the past few years. You can benefit from this booming trend by launching a housecleaning franchise business with companies like Chem-Dry and Merry Maids.

Option #2: Start a “Retail Franchise” Business

When people think about shopping, retail is one of the first industries that come to mind.

Retail franchise businesses come in many shapes and sizes. This way you can focus on an industry that truly matches your interests and skillset.

Fitness Franchise

The fitness industry, and especially sportswear, is thriving.

It’s one of the few sectors that saw huge growth throughout the pandemic, with people paying more attention to their health than ever before. From training shoes to yoga accessories, people have an ongoing need for fitness products.

Starting a fitness franchise business with companies like Anytime Fitness and Planet Fitness can help you target these customers and scale your business.

Real Estate Franchise

Real estate is a tricky but lucrative market for aspiring entrepreneurs. It has a steep learning curve but can help you build a profitable business with a generous cash flow—if done right.

Companies like HomeVestors of America are a great place to start a real estate franchise business.

Car Wash Franchise

Car wash franchises with strong branding can benefit from repeat-purchase loyalty, helping you attract new customers and build long-term relationships—keeping your business profitable.

Some great car wash franchise options include Prime Car Wash, Tommy’s Express, and Mr. Clean.

Sports Franchise

If you have a passion for sports, consider investing in a sporting business. Companies like Soccer Shots offer great franchise opportunities with a mission-driven business model.

You can also focus on companies selling sporting goods, offering training spaces, sports club memberships, and other sport-adjacent activities.

Furniture Franchise

Similar to the growing popularity of housing services, furniture stores are seeing a surge in demand. From selling individual furniture pieces to offering rental packages, franchises in the furniture industry offer a wide range of scaling opportunities.

You can work with franchises like Bloomin’ Minds and Slumberland Furniture.

Option #3: Start a “Food Franchise” Business

People love food, especially fast food. So if you’re looking for a hot-selling, customer-favorite franchise business, start a food franchise. These are super popular, tend to do well economically, and carry great brand recognition across a wide geographic region.

Pizza Franchise Business

Popular food items like pizza have the potential to sell well, offering you a chance to build a profitable franchise business. This is one of those categories where there’s tight competition, but great growth potential.

You have many options to choose from including Domino’s Pizza, Pizza Hut, and Papa John’s.

Coffee Franchise Business

Coffee is another hot-selling item, literally.

If you’re a fan of the beverage and have a desire to manage a consistent business, starting a coffee franchise can be a great option for you. Consider working with companies like Dunkin’, Aroma Joe’s Coffee, and Scooter’s Coffee.

Great Franchise Business Ideas - Coffee Franchise Business

Ice Cream Franchise Business

If you’re looking to target the frozen foods market, consider starting an ice cream franchise business. Brands like Baskin-Robbins have a huge customer base that you can leverage with a franchise business model.

You can also consider companies like Kona Ice which are smaller than the top industry names but offer great variety and opportunities for reaching new customers.

Burger Franchise

When we talk about franchise businesses, we often picture McDonald’s, which is still popular decades after its launch. If you’re looking for that kind of growth, consistency, and brand power, choose a burger franchise.

You can also choose other companies like Wendy’s, Burger King or Carl’s Jr.

Noodle Franchise

Starting a noodle franchise business can offer a great breakfast and snacking option for local residents. You, as a business owner, can build relationships, expand locations, and still remain consistent in your offerings.

You can work with companies like Nothing But Noodles and Noodles & Company to launch noodle franchise businesses.

Option #4: Start a “Professional Services” Franchise Business

If none of the options so far appeal to you and you want to take a more personalized approach, consider launching a professional services franchise business. These offer the greatest potential for customization, adaption, and variation compared to other franchise business models.

With a professional service franchise business, you have a multitude of customer retention opportunities that can be quite profitable in the long run.

Shipping and Mailing Franchise

Nearly every company and residential community needs a shipping and mailing service today. This rising demand offers promising potential for franchise owners.

Established brands like The UPS Store can help you find your customers faster and retain them for decades to come.

Such franchise business models also offer a huge expansion potential as shipping and mailing companies continue to expand the geographical areas they serve.

Printing Franchise

Just like shipping and mailing companies are a cornerstone of work-life across several industries, printing businesses are also a key component of modern living.

The best part of starting a printing franchise business is that it’s easier to set up and manage. It’s relatively low-maintenance, carries low risk, and has much potential to grow, making it an ideal option for new entrepreneurs.

Look for companies like Minuteman Press for launching a successful printing franchise.

Staffing Franchise

Another popular corporate franchise option is a staffing franchise business. Companies like Spherion and Express Employment Professionals help other companies fill their staff positions by connecting them to people looking for jobs.

These franchise business models can help you build positive relationships with major companies in your industry while making a decent profit.

Training Franchise

Along with staffing agencies, companies also need training providers to help upskill their staff. Whether it’s quarterly seminars or yearly upskilling boot camps, working with companies like Sandler Training and Dale Carnegie can help you establish an impactful thought leadership and corporate training franchise business model.

Great Franchise Business Ideas - Training Franchise

Design Franchise

From rebranding to interior decor, design teams are a key player in most major industries.

If you’re passionate about art, decoration and understand the fundamentals of marketing design, you can work with companies like Closets by Design and Decorating Den Interiors to launch a design franchise business.

Frequently Asked Questions About Starting Franchise Businesses

Here are some common questions new entrepreneurs ask when they’re planning to launch a franchise business.

Do I own the rights to a franchise business name?

When you buy a franchise business, you’re only buying the license to use the company’s resources and not the rights to own or manage the company itself. This means, you can own and control the franchise but the original company still remains an independent entity.

Do I have to pay a royalty when I sell through the franchise?

The payment structure for each franchise business depends on the agreement you have with the owning company. For instance, a company may choose to accept royalties for every purchase in addition to a licensing fee. Companies can also work with a fixed-fee payment structure for each franchise location.

What is the difference between a franchise fee and a royalty fee?

While both the franchise fee and royalty fee are necessary to own a franchise, the two are not the same. The franchise fee is the cost of buying a license to use the owning company’s branding and resources. A royalty fee, on the other hand, is a revenue-based fee you pay based on your sales and profits.

An easy way to remember this is to keep in mind that franchise fees are one-time payments for buying the trading license, while royalties are ongoing payments based on your revenue.

Can I sell a franchise?

If you’re not happy with your franchise business, you always have the option to sell it. Franchise exits are pretty common, especially in larger cities where multiple businesses are vying for consumer attention.

However, it’s important to check your agreement before making any selling decisions. Your owning company may not allow you the rights to sell their franchise outside of their organization.

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Franchise Businesses Conclusion

Starting a franchise business has many benefits to offer entrepreneurs at all levels. New business owners may find it easier to run a pre-established business than starting a new brand from scratch.

Mid-level entrepreneurs can also use a franchise to pivot their career, especially if it’s an industry change.

Finally, senior entrepreneurs can hugely benefit from the brand recognition the owning company has built.

Most franchise brands have thousands of loyal customers who become a source of recurring revenue for the business. If you’re able to leverage this reach for further growth, it can be easier to scale your franchise business rapidly.

Which franchise business idea best suits your needs? Which idea would you like to try first?

How To Use Business Credit Wisely to Help With Sound Cash Flow Management … So Your Cash Flow is Always Strong and Never a Headache

Cash flow management is essential to running a successful business.  This is true for a number of reasons. Some of the reasons are obvious, and some are more subtle.  

5 Steps to Building a Cash Pool for Better Cash Flow Management 

First, you need to understand exactly what cash flow is. Investopedia says:

Cash flow is the net amount of cash and cash equivalents being transferred into and out of a business.”

But what does that mean practically for your business? Basically, cash flow relates to the actual, liquid cash flowing in and out of your business. Strong, positive cash flow allows you to have the funds you need ready and available. You can use them at any given time to do the things you need to do to run your business effectively and efficiently.  Why is this important? Because you need cash to: 

  • Pay the bills
  • Pay salaries
  • Buy supplies and stock 
  • To be able to take advantage of growth opportunities

None of these things are possible without cash.  You need a cash flow management strategy.

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit. 

Step 1: Understand Profit is Not the Same as Cash

This is one of the most common misconceptions when it comes to cash flow management. Many think  if you have a strong bottom line, you have cash.  Some business owners are surprised when they find their business can be doing quite well, but they still struggle to pay the bills.  This is because sales do not automatically convert to cash. It can take time to collect payments from customers. Also, if you run a seasonal business, certain times of the year are going to find your business shorter on cash than others. Even non-seasonal businesses have times when they aren’t making as much money.

Step 2: Knowing Why Just Enough is Not Enough

It’s possible that you may have all the cash you need for day to day business operations, but you still need more. For example, if you  have an investment opportunity, like a bulk wholesale deal on inventory, or a growth opportunity, you need to be able to act fast. The more cash you have immediately available, the faster you can act on these opportunities with confidence. A sensible cash flow management system will take this into account. 

Step 3: Develop a Plan for Building a Cash Pool for Cash Flow Management

A cash pool can help you manage your cash flow effectively. It’s a way to make sure you have access to the cash you need, when you need it. A cash pool is an aggregate collection of three different types of cash.  

It includes cash on hand, cash available to spend on vendor accounts, and cash available to spend on business credit cards. How do you build a cash pool for your business? How do you do so and keep business expenses off your personal credit accounts? You need to build business credit. Using business credit to build a cash pool is key to cash flow management.

Cash Reserves and Vendor Accounts

Cash reserve is simply cash on hand. This is the money you have in your business bank accounts that you can spend. Vendor accounts are accounts that you have with vendors that allow your purchases on credit. These are typically net accounts rather than revolving. Net accounts have to be paid off completely within 30, 60, or 90 days, depending on what terms you get with that lender.

Cash Available on Business Credit Cards

This is the total of all available credit you have on business credit cards. Business credit cards can serve your business well in a number of ways. First, they can help protect your business by limiting exposure when making purchases online. This is because most credit card companies have fraud protocols. These protect you from having to pay for fraudulent charges on your account. 

In contrast, if you use a debit card connected to your business bank account and it gets hacked, you could easily lose all of your available cash with potentially very few options for recovery. 

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.

Step 4: Start the Process by Building a Fundable Foundation

It sounds easy, and essentially it is. However, you can’t just go out and apply for vendor accounts and business credit cards and expect to get credit that is only related to your business and does not affect your personal credit report. 

This is the tricky part. There are specific steps that you have to take in a specific order to build a separate business credit profile and score. It starts with how your business is set up. It has to have a foundation of fundability. Then, you have to get accounts reporting initially, which can get interesting. 

If your business isn’t set up right and you don’t apply for the right types of accounts in the beginning, you will be denied every time. 

How to Build a Fundable Foundation

The first step is to make sure your business has a fundable foundation. The includes a number of things such as:

  • Having a physical business address where you get mail
  • A P.O. Box or something similar will not work
  • You need to incorporate as an LLC, S-corp, or corporation
  • An EIN is essential  (get yours from the IRS)
  • A D-U-N-S number from Dun & Bradstreet
  • You need a separate, dedicated business bank account

This is only the beginning, but it is a good start. 

5: Get Accounts That Report

Once you have a fundable foundation, you can start applying for business accounts. The key is, you have to start small by applying with starter vendors first. These are vendors that will not do a personal or business credit check. Rather, they will extend net terms to your business based on other factors.

These factors may include:

  • Time in business
  • Revenue
  • Average balance in business bank account
  • And a lot of other things

Vendors may look at one, all, or any combination of these factors to verify the creditworthiness of your business. Then, they will report your payment on these accounts to the business credit reporting agencies

This brings up another issue. Unlike personal credit accounts where pretty much all creditors report your payment to your personal credit profile, only about 7% of business credit accounts actually report payments.  Of course, the other 93% will not hesitate to report defaulting payments. 

As a result, it can be difficult to find vendors that will both extend credit without a credit check and report payments. They do not make this information easy to find. Still, having accounts that report is vital to building a strong business credit score. Without that, you will not be able to get the accounts you need to build your cash flow pool.

Getting Started

We have a list of vendors that we know do both of these things. They include vendors like Uline and Grainger, among many more. Start building your credit pool with these and other starter vendors by applying for accounts, and buy things like packaging, cleaning products, and office supplies that you will use in the course of your business anyway. 

Once you get enough of these accounts reporting, you will be able to apply for more vendor accounts and business credit cards and get approval.

Of course, you need more than just a few vendor accounts to build a strong business credit score.  The next steps include applying for credit with increasingly harder to meet requirements. If you do things in the right order, you will have no problem getting approval.  That is, assuming you handle all accounts responsibly.

You can apply for accounts like Quill and Office Depot that are a little harder to get, but apply with starter vendors first.  That way, you’ll be closer to meeting their requirements. 

Keep the Ball Rolling

After that, you just have to keep the ball rolling.  You should be well on your way to building your cash flow pool. You can apply for higher limit cards with more rewards. Remember to keep using all of your accounts responsibly, as It does no good to build a cash flow pool if you have no cash available on any of your accounts. 

Bonus: A Top Secret Tip to Help You Get Started

It is not easy to start the ball rolling on your own. It is much faster, cheaper, and easier in the long run to get expert help to build your cash flow pool. A business credit expert can help you evaluate your current fundability. Then, they can get you on the right path to building and improving fundability if necessary. Furthermore, they can point you toward those initial business credit accounts that will open the door to many more, 

With a business credit expert, you will not waste time applying for accounts you do not qualify for. You won’t waste time and money on accounts that do not report to the business credit reporting agencies. You will know exactly what step you are on and what needs to be done to move on to the next step in the process, so you can build your cash flow pool effectively and efficiently.

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.

Once your business credit is strong, a business credit expert can guide you toward even more accounts that may be great additions to your specific credit pool.  These may not be accounts that report, but rather may be more suitable for the type of business you run. Once your business credit profile is strong, you can use non-reporting accounts to continue to grow your business long into the future. 

What Does This Mean for Cash Flow Management? 

It means you can run your business without worrying about cash flow gaps. You can take advantage of wholesale deals when they come along.  It will be possible to apply for larger jobs, knowing you can get the tools and equipment you need to get the job done without depleting cash reserves.

You will be able to quickly take advantage of investment and growth opportunities with confidence, knowing you have the cash available to do what you need to do.  In addition, you can limit your exposure to fraudulent charges when making online purchases. That is sensible cash flow management.

The post How To Use Business Credit Wisely to Help With Sound Cash Flow Management … So Your Cash Flow is Always Strong and Never a Headache appeared first on Credit Suite.

The post How To Use Business Credit Wisely to Help With Sound Cash Flow Management … So Your Cash Flow is Always Strong and Never a Headache appeared first on Business Marketplace Product Reviews.

How To Use Business Credit Wisely to Help With Sound Cash Flow Management … So Your Cash Flow is Always Strong and Never a Headache

Cash flow management is essential to running a successful business.  This is true for a number of reasons. Some of the reasons are obvious, and some are more subtle.  

5 Steps to Building a Cash Pool for Better Cash Flow Management 

First, you need to understand exactly what cash flow is. Investopedia says:

Cash flow is the net amount of cash and cash equivalents being transferred into and out of a business.”

But what does that mean practically for your business? Basically, cash flow relates to the actual, liquid cash flowing in and out of your business. Strong, positive cash flow allows you to have the funds you need ready and available. You can use them at any given time to do the things you need to do to run your business effectively and efficiently.  Why is this important? Because you need cash to: 

  • Pay the bills
  • Pay salaries
  • Buy supplies and stock 
  • To be able to take advantage of growth opportunities

None of these things are possible without cash.  You need a cash flow management strategy.

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit. 

Step 1: Understand Profit is Not the Same as Cash

This is one of the most common misconceptions when it comes to cash flow management. Many think  if you have a strong bottom line, you have cash.  Some business owners are surprised when they find their business can be doing quite well, but they still struggle to pay the bills.  This is because sales do not automatically convert to cash. It can take time to collect payments from customers. Also, if you run a seasonal business, certain times of the year are going to find your business shorter on cash than others. Even non-seasonal businesses have times when they aren’t making as much money.

Step 2: Knowing Why Just Enough is Not Enough

It’s possible that you may have all the cash you need for day to day business operations, but you still need more. For example, if you  have an investment opportunity, like a bulk wholesale deal on inventory, or a growth opportunity, you need to be able to act fast. The more cash you have immediately available, the faster you can act on these opportunities with confidence. A sensible cash flow management system will take this into account. 

Step 3: Develop a Plan for Building a Cash Pool for Cash Flow Management

A cash pool can help you manage your cash flow effectively. It’s a way to make sure you have access to the cash you need, when you need it. A cash pool is an aggregate collection of three different types of cash.  

It includes cash on hand, cash available to spend on vendor accounts, and cash available to spend on business credit cards. How do you build a cash pool for your business? How do you do so and keep business expenses off your personal credit accounts? You need to build business credit. Using business credit to build a cash pool is key to cash flow management.

Cash Reserves and Vendor Accounts

Cash reserve is simply cash on hand. This is the money you have in your business bank accounts that you can spend. Vendor accounts are accounts that you have with vendors that allow your purchases on credit. These are typically net accounts rather than revolving. Net accounts have to be paid off completely within 30, 60, or 90 days, depending on what terms you get with that lender.

Cash Available on Business Credit Cards

This is the total of all available credit you have on business credit cards. Business credit cards can serve your business well in a number of ways. First, they can help protect your business by limiting exposure when making purchases online. This is because most credit card companies have fraud protocols. These protect you from having to pay for fraudulent charges on your account. 

In contrast, if you use a debit card connected to your business bank account and it gets hacked, you could easily lose all of your available cash with potentially very few options for recovery. 

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.

Step 4: Start the Process by Building a Fundable Foundation

It sounds easy, and essentially it is. However, you can’t just go out and apply for vendor accounts and business credit cards and expect to get credit that is only related to your business and does not affect your personal credit report. 

This is the tricky part. There are specific steps that you have to take in a specific order to build a separate business credit profile and score. It starts with how your business is set up. It has to have a foundation of fundability. Then, you have to get accounts reporting initially, which can get interesting. 

If your business isn’t set up right and you don’t apply for the right types of accounts in the beginning, you will be denied every time. 

How to Build a Fundable Foundation

The first step is to make sure your business has a fundable foundation. The includes a number of things such as:

  • Having a physical business address where you get mail
  • A P.O. Box or something similar will not work
  • You need to incorporate as an LLC, S-corp, or corporation
  • An EIN is essential  (get yours from the IRS)
  • A D-U-N-S number from Dun & Bradstreet
  • You need a separate, dedicated business bank account

This is only the beginning, but it is a good start. 

5: Get Accounts That Report

Once you have a fundable foundation, you can start applying for business accounts. The key is, you have to start small by applying with starter vendors first. These are vendors that will not do a personal or business credit check. Rather, they will extend net terms to your business based on other factors.

These factors may include:

  • Time in business
  • Revenue
  • Average balance in business bank account
  • And a lot of other things

Vendors may look at one, all, or any combination of these factors to verify the creditworthiness of your business. Then, they will report your payment on these accounts to the business credit reporting agencies

This brings up another issue. Unlike personal credit accounts where pretty much all creditors report your payment to your personal credit profile, only about 7% of business credit accounts actually report payments.  Of course, the other 93% will not hesitate to report defaulting payments. 

As a result, it can be difficult to find vendors that will both extend credit without a credit check and report payments. They do not make this information easy to find. Still, having accounts that report is vital to building a strong business credit score. Without that, you will not be able to get the accounts you need to build your cash flow pool.

Getting Started

We have a list of vendors that we know do both of these things. They include vendors like Uline and Grainger, among many more. Start building your credit pool with these and other starter vendors by applying for accounts, and buy things like packaging, cleaning products, and office supplies that you will use in the course of your business anyway. 

Once you get enough of these accounts reporting, you will be able to apply for more vendor accounts and business credit cards and get approval.

Of course, you need more than just a few vendor accounts to build a strong business credit score.  The next steps include applying for credit with increasingly harder to meet requirements. If you do things in the right order, you will have no problem getting approval.  That is, assuming you handle all accounts responsibly.

You can apply for accounts like Quill and Office Depot that are a little harder to get, but apply with starter vendors first.  That way, you’ll be closer to meeting their requirements. 

Keep the Ball Rolling

After that, you just have to keep the ball rolling.  You should be well on your way to building your cash flow pool. You can apply for higher limit cards with more rewards. Remember to keep using all of your accounts responsibly, as It does no good to build a cash flow pool if you have no cash available on any of your accounts. 

Bonus: A Top Secret Tip to Help You Get Started

It is not easy to start the ball rolling on your own. It is much faster, cheaper, and easier in the long run to get expert help to build your cash flow pool. A business credit expert can help you evaluate your current fundability. Then, they can get you on the right path to building and improving fundability if necessary. Furthermore, they can point you toward those initial business credit accounts that will open the door to many more, 

With a business credit expert, you will not waste time applying for accounts you do not qualify for. You won’t waste time and money on accounts that do not report to the business credit reporting agencies. You will know exactly what step you are on and what needs to be done to move on to the next step in the process, so you can build your cash flow pool effectively and efficiently.

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.

Once your business credit is strong, a business credit expert can guide you toward even more accounts that may be great additions to your specific credit pool.  These may not be accounts that report, but rather may be more suitable for the type of business you run. Once your business credit profile is strong, you can use non-reporting accounts to continue to grow your business long into the future. 

What Does This Mean for Cash Flow Management? 

It means you can run your business without worrying about cash flow gaps. You can take advantage of wholesale deals when they come along.  It will be possible to apply for larger jobs, knowing you can get the tools and equipment you need to get the job done without depleting cash reserves.

You will be able to quickly take advantage of investment and growth opportunities with confidence, knowing you have the cash available to do what you need to do.  In addition, you can limit your exposure to fraudulent charges when making online purchases. That is sensible cash flow management.

The post How To Use Business Credit Wisely to Help With Sound Cash Flow Management … So Your Cash Flow is Always Strong and Never a Headache appeared first on Credit Suite.

Warning: Don’t Apply for Bank Credit Cards For Your Business Before You Read This

You can’t apply for bank credit cards for your business and expect approval if you don’t have a business credit profile. If you do apply and get approved, it will likely be on the merit of your personal credit.  That means if something goes wrong, your ability to buy a house, a car, or anything else you may want to buy with consumer credit, goes down the drain. 

Find Out Why Your Business Is Being Denied High Limit Bank Credit Cards and the Simple Changes that Can Lead to Approval

If you are applying for high limit credit cards in the name of your business are getting denial after denial, the likely culprit is a lack of business credit profile. Or, you have a business credit profile but a low business credit score. 

The idea behind business credit is that the debt is in your business name.  It is totally separate from you as the owner. This means it does not impact your personal credit score. As a result, since business credit tends to have higher limits, you can actually get more funding for your business. 

The key to avoiding denials is to wait to apply until your business is fundable. This includes having a strong business credit score. 

Check out how our reliable process will help your business get the best business credit cards.

5 Tips for Applying for High Limit Bank Credit Cards for Your Business

1.Build Business Fundability First

If your business is not fundable, business credit will never be an option. It starts with how your business is set up.  It has to be set up to be a fundable entity separate from you, the owner.  How do you accomplish this? It starts with building a fundable foundation. 

The Building Blocks of a Fundable Foundation 

As you know, a foundation is only as strong as the materials you build it from. Here are the building blocks of a strong, fundable foundation for your business. 

Contact Information

Your business should have its own phone number and a physical address. 

EIN

You also need an EIN for your business.  This is an identifying number for your business.  It works similarly to how your SSN works for you personally.   You can get one for free from the IRS.

Incorporate

Incorporating your business as an LLC, S-corp, or corporation is necessary to fundability.  Talk to your attorney or a tax professional about which option might work best for your business. 

Business Bank Account

You have to open a separate, dedicated business bank account.  There are many reasons to do this. One of them is that many lenders require it before they will extend credit.

Licenses

To be fundable, you must be a legitimate business.  For a business to be legitimate, it has to have all of the necessary licenses it needs to run.  

Website

Spend the time and money necessary to ensure your website is professionally designed and works well.  Furthermore, pay for hosting. Don’t use a free hosting service.  Also, make sure your business has a dedicated business email address with the same URL as your website.  Don’t use a free service such as Yahoo or Gmail.

More Fundability Secrets

Now, the foundation is just the tip of the iceberg when it comes to fundability.  In fact, there are well over 100 factors that affect the fundability of the business. However, they all fall into these broader categories. 

  • Business credit reports
  • Business data agencies
  • Identification numbers
  • Business credit history
  • Congruence of business information
  • Financial Statements
  • Bureaus such as FICO and ChexSystems
  • Personal credit scores
  • The application process

Here is a visual that may help you better understand how complex and far reaching business fundability really is. 

2. Try This Expert Trick to Get Out of the “Need Credit to Get Credit” Cycle

The next step is to get accounts reporting to your business credit profile. This is how you build a business credit score.  High limit business bank credit cards will use your business credit score to make an approval decision. 

The truth is, even if you do everything right to initially establish your business credit profile, there is no business credit score on your business’s credit report until accounts are reporting on-time payments.  

With consumer credit, creditors automatically report payments.  In contrast, to work intentionally to find creditors that will report your payments to your business credit profile. Surprisingly, not all of them do. In fact, only about 7% of companies that extend credit to businesses actually report accounts to business credit reporting agencies. 

So, how do you find companies that will extend credit to your business without a good business credit score and report your payments?  That’s the million dollar question, and it’s the trick to getting out of the “need credit to get credit cycle.” 

Check out how our reliable process will help your business get the best business credit cards.

The Secret Weapon

First, the type of vendor that will extend credit to a business without a credit check is called a starter vendor.  Despite not running a credit check, they do have various other factors that they look at to determine whether or not to extend credit. These vary between vendors, but they include fundability factors such as a business bank account, as well as income and time in business, among others. 

Starter vendors typically will extend net terms on invoices rather than revolving credit. However, they will report your payment to the business credit reporting agencies.  In turn, you build your business credit score. Yet, it is very difficult to determine which lenders will report your payments.  That is where the secret weapon comes into play. That is, a business credit expert. 

3. Don’t Try to Build Business Credit Without a Business Credit Expert

As for finding starter vendors that will report, a business credit expert can help. They know which accounts report and which ones you can qualify for right now.  They also help you determine when the tie is right to apply for other accounts.  

There are many more ways that a business credit expert can help, including helping you assess current fundability and improve it if necessary.  Not only that, but they can also help you find funding that you can get while you are working on fundability and building your business credit score.  Get an idea of what a business credit expert can do for you with a free consultation. 

4. Apply for Store Credit 

Soon, you will have an established business credit profile with multiple accounts reporting.  These are credit cards that are restricted to use with the store that issues them. For example, an Office Depot card that you can only use at the store or on that store’s website.  These cards typically start with fairly low limits.  Yet,the limits will increase as you handle the credit responsibly.  Your business credit expert can help you determine when the time is right to start this step, and guide you toward the right store cards for your business. 

  1. 5. Fleet Credit

After you have several of these types of credit cards reporting on-time payments, you should be able to get approval with Fleet cards. These are cards that are more typically limited to the type of purchase you use them on.  They are for automobile fuel and maintenance, but some do allow for certain other purchases as well.  Again, your business credit expert will help you discern when the time is right to apply for fleet cards, and guide you toward the ones that will work best for your business. 

Check out how our reliable process will help your business get the best business credit cards.

Now The Sky’s the Limit for Your Business with High Limit Bank Credit Cards

After you work through each of these steps, responsibly and in order, you should have a well rounded business credit profile and strong business credit score. That is the time to apply for high limit bank credit cards. They include general business credit cards from Visa, MasterCard, Discover, and the like that are not limited by location of use or purchase type.  

They generally have very high limits and favorable incentives. All you have to do is pick the ones with the best interest rates and the rewards programs that fit your business best. If you jump right in before establishing your business credit profile and business credit score, you will get denials from these types of cards every time. 

Using a business credit expert to help you assess and improve fundability, find starter vendors that report,  and guide you in knowing the right accounts to apply for at the right time to get approval makes the process much faster and easier.  As a result, you will avoid wasting time with vendors that do not report, and move through the steps as fast as possible.  Then, you can watch your business grow and thrive with high limit bank credit cards.

The post Warning: Don’t Apply for Bank Credit Cards For Your Business Before You Read This appeared first on Credit Suite.

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Ditch the Boss…Here’s How to Start a Small Business With No Money

Do you dream of starting your own small business but have no clue how to finance it? The number one thing that stands in the way of those who want to start a business, assuming they already have an idea of the type of business they want to start, is that they have no money. A general rule of life is it takes money to make money. While in a way this is true, it’s not always as cut and dry as it seems. Find out how to start a small business with no money.

No Money? No Problem! Try These Tried and True Tips for How to Start a Business with No Money

Ok, so let’s be real.  It actually does take money to start a business.  However, it doesn’t have to be money you already have. In fact, it doesn’t even have to be your money at all!  Here are some creative ideas for how to start a small business with no money, or rather, how to get the money you need to make your small business dreams come true.

Credit Line Hybrid Financing: Get up to $150,000 in financing so your business can thrive.

How to Start a Business With No Money

So, you do need money to start and grow a business, and we are going to show you how to get it. Yet, you don’t have to wait to start.  Start your business now, and grow it from the ground up.

1. Start Small

Facebook was started by college roommates in their dorm room, Microsoft was birthed in a garage by a college drop out, and Hewlett- Packard got started with less than $600. These are just a few of the many major companies that started out very small and with little capital.  After all, how many people actually remember that Amazon used to be an online bookstore?

Starting small is essential, especially if you are wondering how to start a small business with no money. Cut out as much overhead as you can and focus on getting your product to the customers.

2. Keep Your Day Job…For Now

It will be a challenge for sure, but working your business outside of your regular working hours, while keeping your current job if you have one, will allow you to put any profit from your business back into your business.  In essence, your business will be funding itself.

3. Keep Early Marketing Simple

In the early stages, simple is best. Offer free samples, leverage word of mouth, and start a Facebook page. As you build funds, you can increase your marketing strategy as well.

Be strategice as well. There is no need to market to the masses initially.  Keep it narrowed down to the market that you know will be interested.

How to Start a Small Business With No Money: Leverage Your Assets

Now, you do need to figure out how to get the funding you need.  If you have no money, you may struggle to get a small business loan.  As you are starting small and building revenue, consider what  assets you can leverage to get the cash you need.

There is always the option to use  your home or land as collateral for a loan.  Pretty much any bank will do that.  Yet, that understandably makes many uncomfortable. There are some better options.

401K Financing

401K financing is a flexible and powerful way to leverage assets that are in a 401(k) plan or IRA.  In as little as 3 weeks you can actually invest a portion of these funds into your own business. Then, you not only have more control over the performance of your retirement plan assets, but you also have the working capital you need.

This type of program even has the blessing of the IRS. In fact, they  have their own term for it. It’s called a Rollover for Business Startups (ROBS).

You do not have to submit financials or have good credit to get approval. In fact, all the lender will ask for is a copy of your two most recent 401(k) statements.

If the plan has a value of more than $35,000,  you can get approval. This is true even if you have bad personal credit. You can get however much of your 401(k) is “rollable.”

The plan you use cannot be from a business where you currently work. It will have to be from previous employment. Also, you can’t still be contributing to it.

Equipment Financing

This is a great option if you need equipment for your business and have no money to purchase it.  Equipment financing allows you to purchase or borrow hard assets for your business using said asset as security for the loan. You can use it to buy or lease any physical asset. This can include items like an industrial freezer in a restaurant or an oven or a company car.  You name it.

How to Start a Small Business With No Money: Use a Guarantor

What if you have no money and no assets? What then? You still have options. The easiest way to get funding for a business if you can’t do it on your own is to use a guarantor. Many entrepreneurs have friends or family that will sign a loan with them. Doing so tells the lender that, if you default, your guarantor will be responsible for the payments.

This is a better option for many, because the guarantor isn’t out any money up front, and they only have to pay if you do not.  Keep reading for one of our favorite options for guarantor funding.

Credit Line Hybrid Financing: Get up to $150,000 in financing so your business can thrive.

Credit Line Hybrid

What if there were a way to fund your business with 0% interest? The Credit Line Hybrid allows you to fund your business without putting up collateral, and you only pay back what you use.  Generally, you do need a personal credit score of 680 or above, and you can’t have any liens, judgments, bankruptcies or late payments.  However, if you do not meet the requirements, you have the option to take on a credit partner, which is in essence a guarantor. And yes, you can often get 0% interest for up to 18 months!

The great part is, this program reports payment to your business credit profile, meaning you build your business credit score regardless of whether you have a guarantor or not.

How to Start a Small Business With No Money: Other Options

If you do not have assets, your personal credit is not great, and you can’t find a guarantor, all is not lost. Here are some other possibilities.

Crowdfunding

Crowdfunding allows you to access tons of investors at once, and test the market at the same time. You market your business on the platform, and anyone who wants to can invest in the company.  Some platforms will even accept donations as low as $5 or $10 dollars, though most do require more.  With rewards-based crowdfunding, you get a trinket of thanks for your donation.  This may be anything from a thank you note to a free product.  With equity-based crowdfunding, which almost always requires $500 or more, investors get a piece of the company. There are a ton of crowdfunding sites to choose from, you just have to pick the one that will work best for your business.

One unique program is Kiva.  The money you get has to be repaid, but the loan is crowdfunded.  The interest rate is 0%, so even though you do pay it back, it’s free money.  You have to get at least five of your family and friends on board to donate to your business, and then you have to lend $25 to another company on the Kiva platform.

After that, submit a thorough business plan and you could be well on your way to a 0% interest loan.

Angel Investors

Now, an angel investor from an angel firm is going to want to know you have some money already, likely. But you don’t need to go through an angel firm, because anyone can be an angel investor. That includes friends and family, even your mom!  So, this is definitely an option if needed.

Credit Line Hybrid Financing: Get up to $150,000 in financing so your business can thrive.

Is it Even Possible to Start a Small Business Without Money?

In the strictest terms, no.  You have to have funds to start a business. However, there are ways to fund your business without having money in the first place. While knowing how to start a small business with no money is important, it is always important to understand how to set your business up to get the funding it needs into the future as well.

The key to that is to start building business fundability from the beginning. As you consider funding options for your small business startup, look for those that will help you build fundability.  As you set up, set your business up in a way that will help it become more fundable.  These things are best done at the beginning.

You can discover what funding options are available to you right now, and get a head start on fundability by speaking with one of our business credit experts.  Try a free consultation now!

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Warning: Don’t Apply for Bank Credit Cards For Your Business Before You Read This

You can’t apply for bank credit cards for your business and expect approval if you don’t have a business credit profile. If you do apply and get approved, it will likely be on the merit of your personal credit.  That means if something goes wrong, your ability to buy a house, a car, or anything else you may want to buy with consumer credit, goes down the drain. 

Find Out Why Your Business Is Being Denied High Limit Bank Credit Cards and the Simple Changes that Can Lead to Approval

If you are applying for high limit credit cards in the name of your business are getting denial after denial, the likely culprit is a lack of business credit profile. Or, you have a business credit profile but a low business credit score. 

The idea behind business credit is that the debt is in your business name.  It is totally separate from you as the owner. This means it does not impact your personal credit score. As a result, since business credit tends to have higher limits, you can actually get more funding for your business. 

The key to avoiding denials is to wait to apply until your business is fundable. This includes having a strong business credit score. 

Check out how our reliable process will help your business get the best business credit cards.

5 Tips for Applying for High Limit Bank Credit Cards for Your Business

1.Build Business Fundability First

If your business is not fundable, business credit will never be an option. It starts with how your business is set up.  It has to be set up to be a fundable entity separate from you, the owner.  How do you accomplish this? It starts with building a fundable foundation. 

The Building Blocks of a Fundable Foundation 

As you know, a foundation is only as strong as the materials you build it from. Here are the building blocks of a strong, fundable foundation for your business. 

Contact Information

Your business should have its own phone number and a physical address. 

EIN

You also need an EIN for your business.  This is an identifying number for your business.  It works similarly to how your SSN works for you personally.   You can get one for free from the IRS.

Incorporate

Incorporating your business as an LLC, S-corp, or corporation is necessary to fundability.  Talk to your attorney or a tax professional about which option might work best for your business. 

Business Bank Account

You have to open a separate, dedicated business bank account.  There are many reasons to do this. One of them is that many lenders require it before they will extend credit.

Licenses

To be fundable, you must be a legitimate business.  For a business to be legitimate, it has to have all of the necessary licenses it needs to run.  

Website

Spend the time and money necessary to ensure your website is professionally designed and works well.  Furthermore, pay for hosting. Don’t use a free hosting service.  Also, make sure your business has a dedicated business email address with the same URL as your website.  Don’t use a free service such as Yahoo or Gmail.

More Fundability Secrets

Now, the foundation is just the tip of the iceberg when it comes to fundability.  In fact, there are well over 100 factors that affect the fundability of the business. However, they all fall into these broader categories. 

  • Business credit reports
  • Business data agencies
  • Identification numbers
  • Business credit history
  • Congruence of business information
  • Financial Statements
  • Bureaus such as FICO and ChexSystems
  • Personal credit scores
  • The application process

Here is a visual that may help you better understand how complex and far reaching business fundability really is. 

2. Try This Expert Trick to Get Out of the “Need Credit to Get Credit” Cycle

The next step is to get accounts reporting to your business credit profile. This is how you build a business credit score.  High limit business bank credit cards will use your business credit score to make an approval decision. 

The truth is, even if you do everything right to initially establish your business credit profile, there is no business credit score on your business’s credit report until accounts are reporting on-time payments.  

With consumer credit, creditors automatically report payments.  In contrast, to work intentionally to find creditors that will report your payments to your business credit profile. Surprisingly, not all of them do. In fact, only about 7% of companies that extend credit to businesses actually report accounts to business credit reporting agencies. 

So, how do you find companies that will extend credit to your business without a good business credit score and report your payments?  That’s the million dollar question, and it’s the trick to getting out of the “need credit to get credit cycle.” 

Check out how our reliable process will help your business get the best business credit cards.

The Secret Weapon

First, the type of vendor that will extend credit to a business without a credit check is called a starter vendor.  Despite not running a credit check, they do have various other factors that they look at to determine whether or not to extend credit. These vary between vendors, but they include fundability factors such as a business bank account, as well as income and time in business, among others. 

Starter vendors typically will extend net terms on invoices rather than revolving credit. However, they will report your payment to the business credit reporting agencies.  In turn, you build your business credit score. Yet, it is very difficult to determine which lenders will report your payments.  That is where the secret weapon comes into play. That is, a business credit expert. 

3. Don’t Try to Build Business Credit Without a Business Credit Expert

As for finding starter vendors that will report, a business credit expert can help. They know which accounts report and which ones you can qualify for right now.  They also help you determine when the tie is right to apply for other accounts.  

There are many more ways that a business credit expert can help, including helping you assess current fundability and improve it if necessary.  Not only that, but they can also help you find funding that you can get while you are working on fundability and building your business credit score.  Get an idea of what a business credit expert can do for you with a free consultation. 

4. Apply for Store Credit 

Soon, you will have an established business credit profile with multiple accounts reporting.  These are credit cards that are restricted to use with the store that issues them. For example, an Office Depot card that you can only use at the store or on that store’s website.  These cards typically start with fairly low limits.  Yet,the limits will increase as you handle the credit responsibly.  Your business credit expert can help you determine when the time is right to start this step, and guide you toward the right store cards for your business. 

  1. 5. Fleet Credit

After you have several of these types of credit cards reporting on-time payments, you should be able to get approval with Fleet cards. These are cards that are more typically limited to the type of purchase you use them on.  They are for automobile fuel and maintenance, but some do allow for certain other purchases as well.  Again, your business credit expert will help you discern when the time is right to apply for fleet cards, and guide you toward the ones that will work best for your business. 

Check out how our reliable process will help your business get the best business credit cards.

Now The Sky’s the Limit for Your Business with High Limit Bank Credit Cards

After you work through each of these steps, responsibly and in order, you should have a well rounded business credit profile and strong business credit score. That is the time to apply for high limit bank credit cards. They include general business credit cards from Visa, MasterCard, Discover, and the like that are not limited by location of use or purchase type.  

They generally have very high limits and favorable incentives. All you have to do is pick the ones with the best interest rates and the rewards programs that fit your business best. If you jump right in before establishing your business credit profile and business credit score, you will get denials from these types of cards every time. 

Using a business credit expert to help you assess and improve fundability, find starter vendors that report,  and guide you in knowing the right accounts to apply for at the right time to get approval makes the process much faster and easier.  As a result, you will avoid wasting time with vendors that do not report, and move through the steps as fast as possible.  Then, you can watch your business grow and thrive with high limit bank credit cards.

The post Warning: Don’t Apply for Bank Credit Cards For Your Business Before You Read This appeared first on Credit Suite.

Ditch the Boss…Here’s How to Start a Small Business With No Money

Do you dream of starting your own small business but have no clue how to finance it? The number one thing that stands in the way of those who want to start a business, assuming they already have an idea of the type of business they want to start, is that they have no money. A general rule of life is it takes money to make money. While in a way this is true, it’s not always as cut and dry as it seems. Find out how to start a small business with no money.

No Money? No Problem! Try These Tried and True Tips for How to Start a Business with No Money

Ok, so let’s be real.  It actually does take money to start a business.  However, it doesn’t have to be money you already have. In fact, it doesn’t even have to be your money at all!  Here are some creative ideas for how to start a small business with no money, or rather, how to get the money you need to make your small business dreams come true.

Credit Line Hybrid Financing: Get up to $150,000 in financing so your business can thrive.

How to Start a Business With No Money

So, you do need money to start and grow a business, and we are going to show you how to get it. Yet, you don’t have to wait to start.  Start your business now, and grow it from the ground up.

1. Start Small

Facebook was started by college roommates in their dorm room, Microsoft was birthed in a garage by a college drop out, and Hewlett- Packard got started with less than $600. These are just a few of the many major companies that started out very small and with little capital.  After all, how many people actually remember that Amazon used to be an online bookstore?

Starting small is essential, especially if you are wondering how to start a small business with no money. Cut out as much overhead as you can and focus on getting your product to the customers.

2. Keep Your Day Job…For Now

It will be a challenge for sure, but working your business outside of your regular working hours, while keeping your current job if you have one, will allow you to put any profit from your business back into your business.  In essence, your business will be funding itself.

3. Keep Early Marketing Simple

In the early stages, simple is best. Offer free samples, leverage word of mouth, and start a Facebook page. As you build funds, you can increase your marketing strategy as well.

Be strategice as well. There is no need to market to the masses initially.  Keep it narrowed down to the market that you know will be interested.

How to Start a Small Business With No Money: Leverage Your Assets

Now, you do need to figure out how to get the funding you need.  If you have no money, you may struggle to get a small business loan.  As you are starting small and building revenue, consider what  assets you can leverage to get the cash you need.

There is always the option to use  your home or land as collateral for a loan.  Pretty much any bank will do that.  Yet, that understandably makes many uncomfortable. There are some better options.

401K Financing

401K financing is a flexible and powerful way to leverage assets that are in a 401(k) plan or IRA.  In as little as 3 weeks you can actually invest a portion of these funds into your own business. Then, you not only have more control over the performance of your retirement plan assets, but you also have the working capital you need.

This type of program even has the blessing of the IRS. In fact, they  have their own term for it. It’s called a Rollover for Business Startups (ROBS).

You do not have to submit financials or have good credit to get approval. In fact, all the lender will ask for is a copy of your two most recent 401(k) statements.

If the plan has a value of more than $35,000,  you can get approval. This is true even if you have bad personal credit. You can get however much of your 401(k) is “rollable.”

The plan you use cannot be from a business where you currently work. It will have to be from previous employment. Also, you can’t still be contributing to it.

Equipment Financing

This is a great option if you need equipment for your business and have no money to purchase it.  Equipment financing allows you to purchase or borrow hard assets for your business using said asset as security for the loan. You can use it to buy or lease any physical asset. This can include items like an industrial freezer in a restaurant or an oven or a company car.  You name it.

How to Start a Small Business With No Money: Use a Guarantor

What if you have no money and no assets? What then? You still have options. The easiest way to get funding for a business if you can’t do it on your own is to use a guarantor. Many entrepreneurs have friends or family that will sign a loan with them. Doing so tells the lender that, if you default, your guarantor will be responsible for the payments.

This is a better option for many, because the guarantor isn’t out any money up front, and they only have to pay if you do not.  Keep reading for one of our favorite options for guarantor funding.

Credit Line Hybrid Financing: Get up to $150,000 in financing so your business can thrive.

Credit Line Hybrid

What if there were a way to fund your business with 0% interest? The Credit Line Hybrid allows you to fund your business without putting up collateral, and you only pay back what you use.  Generally, you do need a personal credit score of 680 or above, and you can’t have any liens, judgments, bankruptcies or late payments.  However, if you do not meet the requirements, you have the option to take on a credit partner, which is in essence a guarantor. And yes, you can often get 0% interest for up to 18 months!

The great part is, this program reports payment to your business credit profile, meaning you build your business credit score regardless of whether you have a guarantor or not.

How to Start a Small Business With No Money: Other Options

If you do not have assets, your personal credit is not great, and you can’t find a guarantor, all is not lost. Here are some other possibilities.

Crowdfunding

Crowdfunding allows you to access tons of investors at once, and test the market at the same time. You market your business on the platform, and anyone who wants to can invest in the company.  Some platforms will even accept donations as low as $5 or $10 dollars, though most do require more.  With rewards-based crowdfunding, you get a trinket of thanks for your donation.  This may be anything from a thank you note to a free product.  With equity-based crowdfunding, which almost always requires $500 or more, investors get a piece of the company. There are a ton of crowdfunding sites to choose from, you just have to pick the one that will work best for your business.

One unique program is Kiva.  The money you get has to be repaid, but the loan is crowdfunded.  The interest rate is 0%, so even though you do pay it back, it’s free money.  You have to get at least five of your family and friends on board to donate to your business, and then you have to lend $25 to another company on the Kiva platform.

After that, submit a thorough business plan and you could be well on your way to a 0% interest loan.

Angel Investors

Now, an angel investor from an angel firm is going to want to know you have some money already, likely. But you don’t need to go through an angel firm, because anyone can be an angel investor. That includes friends and family, even your mom!  So, this is definitely an option if needed.

Credit Line Hybrid Financing: Get up to $150,000 in financing so your business can thrive.

Is it Even Possible to Start a Small Business Without Money?

In the strictest terms, no.  You have to have funds to start a business. However, there are ways to fund your business without having money in the first place. While knowing how to start a small business with no money is important, it is always important to understand how to set your business up to get the funding it needs into the future as well.

The key to that is to start building business fundability from the beginning. As you consider funding options for your small business startup, look for those that will help you build fundability.  As you set up, set your business up in a way that will help it become more fundable.  These things are best done at the beginning.

You can discover what funding options are available to you right now, and get a head start on fundability by speaking with one of our business credit experts.  Try a free consultation now!

The post Ditch the Boss…Here’s How to Start a Small Business With No Money appeared first on Credit Suite.

Looking for an Online Business Loan? Read this Become.co Review Before You Do Anything Else

Become.co, once known as Lending Express, claims to help businesses get funding even when they have gotten denials elsewhere. But can they do what they say?

An All In Become.co Review

First as Lending Express, and now as Become, this is a company that claims to be able to help businesses get funding when they have not otherwise been able to do so.  What is their secret, and does it really work? We dug deep in order to find out.

Become.co Review: What is Become?

First things first. This is not a lender. Rather, they are more of a lender and borrower dating service.  They collect information from potential borrowers and send it to partner lenders. The lenders then decide whether or not they want to make a financing offer to the would-be borrower. The company spins it as lenders competing for the opportunity to fund the borrower’s business.  In some cases, this may well be how it turns out.

Find out why so many companies use our proven methods to get business loans.

Become.co Review: Types of Business Loans

The lenders that work with Become offer a broad range of lending products.  They include:

  • Startup business loans
  • Commercial vehicle loans
  • Asset based loans
  • SBA loans
  • Merchant cash advances
  • Lines of credit
  • Invoice financing
  • And unsecured business loans

Become.co Review: How Does it Work?

First, you fill out an application with Become.  Then, the company technology analyzes the application and matches you with the best lenders for your business from among their partners.

Application Process

  1. Select how much you need under “loan amount” and then “Get Loan Offer”’
  2. Fill out the information asked for, which includes time in business, industry, revenue etc.
  3. Select up to 3 different lenders.
  4. Then, you will have to connect your business’s checking account to be analyzed.
  5. After that, you wait for the offers to roll in.
  6. After reviewing offers, select the lender you wish to go with.
  7. Funds will be deposited into your business checking account.

The process takes about 15 minutes and involves a soft pull on your credit report.  It will not affect your credit.

Rates and Terms

Typically, the minimum amount available from partner lenders is $5,000.  The  maximum is up to $500,000.  Flexible repayment is available based on monthly turnover. Loan terms are from 3 to 36 months.

Also, repayments do not use “interest rates.”  Rather, you are given a payback amount, which is agreed on upfront. It is based on your business type and your loan term.

They claim this  structure is beneficial for your business cash flow, because you will know your total costs upfront.  While not untrue, it would be wise to calculate an effective interest rate for comparison purposes.  For example, if your loan amount is $5,000 and your repayment amount is $5,500, your effective interest rate is 10% over the life of the loan.

This is important information to know, so that you can make sure you are getting the best deal possible for your business.

Qualifying

Any business owner can apply.  If you do not qualify, you will still be assigned a dashboard explaining the reason why, along with tips to help you improve your chances. At a minimum, you should have an average revenue of $5,000 per month, ideally.  You also need to have been in business for at least 3 months if you are a U.S. business and at least 6 months if you are in Australia.

As for credit score, while it is important, some of their partners do not deny based on a low credit score.  Instead, their decision is based on the overall health of your business as determined by a number of factors. These may include revenue, time in businesses, average balance in business bank accounts, and more.

Clearly, the more of these factors you have in your favor, the better your chances are going to be for getting funding from Become.

Required Documents

You must have a business checking account.  Become will analyze the statements for the past 3 to 6 months. Other document requirements will be up to the lender you end up applying to.  Some examples of documents they may require include merchant statements, tax returns, and financing projections. It will never hurt to have a business plan.

Find out why so many companies use our proven methods to get business loans.

Become.co Review: How Are They Different?

Become uses technology and advanced algorithms to help match business borrowers to alternative lenders. The process is free, and unlike others, they do more than just match borrowers to lenders. They also function as a credit profiler.

Their proprietary technology renders a unique LendingScore™ for each business.  This is a financing profile that is intended to help the company improve funding possibilities, access new opportunities, and find the best funding solutions.

Find out why so many companies use our proven methods to get business loans.

Become.co Review: Reputation

They do not seem to have a  Better Business Bureau profile, at least not under the name Become. There is a company with the same name that uses the URL “Become.com.” Become.com appears to be an online shopping portal, wholly unrelated to Become. Co. Since both companies are in the state of California, this could be quite confusing.

They do, though, have a very good rating on Trustpilot. The rating is 4.8 stars.  There are over 500 reviews, and over 90% of them are excellent.

Become.co Review: Are They All That They Claim to Be?

It seems that they do a great job.  They have a lot of happy customers, and Trustpilot is a trusted review source. That said, it’s unfortunate that they chose a name that requires a .co URL.  This may make them hard for many to find when looking for small business loans.  Alos, the name “Become” doesn’t exactly reflect who they are or what they do, further complicating the ability of business owners to find them. It is a very generic word which most people would not relate to business funding.

Another potential area of concern is the fact that they want access to your business bank account. It sounds as if they want to access it electronically. Still, online lenders are doing this more and more these days.  Given the number of great reviews, it may not be an issue.  That is a decision you will have to make for yourself.

Is Become the End of the Road if You Do Not Qualify?

If you fill out an application with Become and you do not qualify for funding with any of their lenders, your dashboard will contain the reasons why and ideas to help you qualify in the future. This can be helpful in the long term. But, what if you need funding right now?

A business credit expert can help walk you through the process of building a business credit profile.  This is separate from your personal credit profile, and will open up new funding opportunities.  They can also analyze the current fundability of your business, and help you find ways to improve it.

In addition, they can help you find the funding you need right now with products like 401K financing and the Credit Line Hybrid.  Get a free consultation today.

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