Small Business Blog

Archive for the ‘Small Business’ Category

We are all listening attentively about lenders on the radio, television, newspapers, and the Internet of promises to be “small business friendly”, “small business oriented”, wanting to be your “personal small business advisor” and a panoply of packages taking care of all your business needs. What small businesses really need is money, not personal hand caring services. So is there anyone out there really making small business loans? Yes. If you know where to look you can find one.

You can generally categorize banks into: 1) 10% that are actually making small business loans now and are serious about doing so, 2) 70% who will talk to you directly and indicate they are not making small business loans at this time because of the economy, and 3) 20% that slap you on the back, invite you in, and readily take your application. It is the latter group that gives us the most heartburn. It is not unusual after the initial review of your application papers for a bank represented to signal you have a good chance. Overjoyed, you begin to make plans, including executing contracts and receiving quotes for inventory, raw materials, or merchandise. Two months later, after the fourth loan committee review, you get a call that they have decided not to make the loan. The reason has little if anything to do with credit. It is typically something that was never been mentioned before and after reflection, it seems like an excuse not to make the loan in the first place.

Loan brokers such as myself are victims of the same misleading behavior. I cannot tell you how many banks have looked me in the eye and said: “Sure, we are making lots of loans. For unsecured loans of $75,000 to $150,000, we just need a credit score above 680, in business for over a year and a half, and decent financials. Real estate security is not required. We would love to entertain your applications.” Right.

What they really do is pour over the applications and pick 1 out of 100 that has the following fantasy credentials: a platinum credit score that Bill Gates would be proud of and which could support a small country, gushing positive cash flow, little competition, executed contracts stacked high on your desk, then a booming market niche. In other words, someone who doesn’t need the loan in the first place. You know the old adage: banks only give money to people who don’t need it.

It is simply psychology 101. Banks are filled up with loan officers and they have to show they are busy. If their boss walks into their office and sees nothing on their desk, they might be laid off. They have to show they are busy earning their salaries, which means receiving applications and going through the review process. It’s gotten so bad that the other day we had a client whose grandfather helped found the bank, whose father was best friends with the president, and who had received two successful loans before. Even he was turned down. Nor do they tell you the large SBA commercial loan department job layoffs of employees throughout the nation.

To prevent being too caught in this trap, look your banker in the eye and ask these questions:

1) “Tell me honestly. I don’t want to waste your time or mine. I know the credit crunch is quite depressing and there is really no secondary market. Are you actually entertaining small business loans at this time or should I wait.”

2) “How many small business loans have you personally made in the last 30 days?”

3) “What are the loan terms of the last three loans you made, including interest rate and monthly payments, for the amount of loan I am seeking?”

4) “How long will it take before I get a definitive answer?”

5) “Can you briefly describe to me the process I have to go through to get the final approval? Will you be the one making the final decision? What other people superior to you or committees will make that decision?”

But do not despair. There actually are real live prime lenders out there making small business loans. They just need to know where to look. In the next article I will discuss if such loans are available to startups.

There are so many ways to make money. You do not need to have a big building to make a company or run a business. You can do your business from your own home. You can get money by benefited your properties to make money in your home. You can do it while you are doing your regular job.

So many people are willing to start a new business from home. There are several websites in which you can get much information about starting a home business. Smallbusiness.dnb com is one place where you can get information about checklists that you should follow to start a home based business. There are twelve checklists that you can follow and be your guidance. You can also get information of how to begin businesses from home. In Business.gov, you can get links to some discussion about business from home and the way to financing and marketing home business industries. You can also get information about taxes information for home businesses.

Moreover, you can get information about patent application title here in Faqs.org. There are two inventors, Dana Matthew Bashor and William Charles Stevenson. Then, here you can get information about Dana Bashor Patent for a home industry. Good luck for your new home business industry.

Small businesses are usually sole proprietorships, partnerships or privately owned corporations. They employ a small number of employees and often do not have financial turnovers as large as those of large multinational companies. Small businesses are present in every industry. Ranging from interior designing to jewelry sales and even pet services, it is hard to avoid any of these businesses in our daily lives.

However, with so many small businesses selling products and services in society, we often forget that they can potentially be a very lucrative pool of customers as well. Any company that provides products or services to small businesses can benefit greatly from having a small business list.

Fortunately, the advancement of technology has enabled almost anyone to get access to a small business list with ease. There are online portals available for organizations and individuals to communicate with these small businesses, allowing them to get up-to-date information about company details and any other updates. One can also do a quick search online to look for such publicly available small company details. However, this is a potentially long and tedious process.

A good alternative is to look for small business mailing lists offered by list brokers and compliers on the web. The small business lists provided by brokers enable immediate access to a large pool of up-to-date information about other small businesses. The best part is that these lists are continuously being updated, so you won’t have to worry too much about getting outdated information. A quick rental of such a list would save one the time of having to personally search and update records.

Next, after having a small business list, individuals and other businesses can use it to their advantage. Entrepreneurs, start-up firms and home-based workers can use the list to conduct market analysis and research for example. This way, they easily identify market needs and are able to offer their products and services to these potential clients.

Another way a small business list can be used is to send out promotional material to highly targeted business prospects. For example, if you own an air-conditioning repair service, you could send out promotional brochures advertising your services to small businesses that could very well be your clients in the future. After all, which business office doesn’t own an air-conditioner or two?

The benefits of having access to a small business list is worth it’s weight in gold. But should one compile the list themselves, or rent one instead? If one wishes to manually compile the small business list himself, he will have to ensure that they are constantly being kept up-to-date.

This is because companies often make changes in their management, causing contact persons to change, or even a change in company address. The time and monetary costs required to maintain an accurate list of small business contact information is not small.

To avoid this, it would be best to rent a small business list and spend their time on making actual sales.

Having immediate access to a complied updated business list helps individuals and organizations to save time and money. When they require small businesses for their marketing needs or require help in their businesses, they can tap on this large resource base easily and efficiently.

People who own and run small businesses may have been overlooked in the past. Not attracted to the big budgets and sophisticated requirements of big business, the security industry has not focused on providing small business security. Small businesses had to settle for inappropriate and overpriced security that resembled home security systems.

But there’s good news. Leading security industry manufacturers and providers are paying attention now. They’re beginning to understand that the unique needs of small business security require tailored security measures and systems.

Small business security does have one advantage. Needing smaller staff and experiencing less turnover than large businesses, small business’s risk for in-house theft is significantly less, reducing the need for inventory tracking and video monitoring for break rooms and storage areas. But small businesses still face serious risks for theft, vandalism, and violence.

Small business security needs are in many ways like those of corporations and individual homeowners. Common-sense security measures are important. Things like removing potential hiding places for would-be thieves by eliminating blind spots on building exteriors is a basic preventive measure. Lighting the building, inside and out, makes it possible for people outside the building to observe criminal activity at night and when the business is closed. Keeping entry points clear of obstructions and shadows is important to safety and security. Installing locks with security codes for individual employees prevents entry by unauthorized people.

Exterior lighting is not only important for security. It’s an important way to prevent injuries to customers and to prevent crimes against both customers and employees outside the building. Liability insurance is a significant expense, and good exterior lighting can qualify small businesses for discounts and insurance savings. So in a way, liability insurance is a good small business security measure.

Every year, small businesses lose billions of dollars to preventable theft and vandalism. Monitored commercial alarm systems are an inexpensive and effective way to protect your small business. They’re easy to install in less than a day, and they’re easy to operate. A good small business security system will include control panels, security keypads, glass break sensors, window and door contacts, motion detectors, and sirens. Systems can be hard-wired or wireless. They can include loud immediate alarms or silent alarms that alert law enforcement without interrupting ongoing business. They can have add-ons like fire alarms and video surveillance. You can get a back-up system to assure your small business security needs are covered at all times.

If you haven’t already done it, you should ask a security professional to inspect and assess your small business for vulnerabilities and ask for a proposal that addresses them. Inherently more vulnerable to financial losses, there’s no such thing as too much security for a small business. An expert in the field can help you identify your small business security needs and create a plan that both meets your budget and makes your small business more secure.

When shopping for a small business security system provider, there are a few basic ways to select the best one for your needs. First, you should always talk to more than one company. Three or four reputable vendors is a logical choice that produces competition and gives you a variety of ideas and options. They should be willing to come to your business for face-to-face meetings. Be sure to get the proposals and price estimates in writing, and make sure the proposals are complete, including monthly charges, set-up and installation fees, and warranties. Find out if they offer training for you and your staff. Once you’ve made a commitment, review the contract very carefully to make sure it includes all the options you discussed with them.

The small business security specialist can analyze your physical layout, your internal procedures, and your vulnerabilities to help you come up with a comprehensive plan.

“Small businesses” is an economically term which generally related to the business scope and extent. The taxing authorities categorize “small business” according to their finance turnover in a defined time duration, in most cases: a year. Another aspect of specifying a business as a “small” one is its field of activity: a single barber shop, or a single “Pizza” parlor, or a single stand in a marketplace, are “small businesses”. When one of those becomes “a chain of…” it’s another story.

The behavioral sciences, especially Sociology, regard “small business” as a small organization. From the sociology point of view a business is a type of social organization. The sociology discipline classifies organizations by their internal human relations and interaction. No matter how many people are involved, what’s count is the quality of the inter-relationships among them. If everybody knows everybody, face to face, by each name, and the instrumental communication is informal as the social communication, then it’s a “small organization”. 

Such informal relationships can function when we are talking about 2 to 100 workers, managers and subordinates all together. Probably when it’s a 100 people organization we’ll find formal division of labor, duties definitions and documented regulations. On the other hand – a 4 personnel store: the informality is extreme and there is no room for documentation and definitions, everyone is doing everything and if the boss, the store owner, will keep distance – he’ll lose the great advantage of potential warm instrumental relationships with his three salespersons.

Between the 4 and 100 personnel the most common are the 30-40 personnel small businesses. Even if the business owner will try to establish formal regulations he wouldn’t succeed. In such a small organization people will behave according to the informal habits which dominate the everyday activities. There is no way that a new employee will sit down and read a documented guidance book. What will probably happen is that he’ll be told orally what to do by a senior foreman and will complete his integration by imitating others in his close working environment. If he’ll insist to read written instructions he wouldn’t find it because it doesn’t exist  in such small businesses and if he will – it wouldn’t be updated. This is the great fault of small organizations and yet their great advantage: it makes them much more flexible and adaptable to market real time changes.

The sociologist Max Weber claimed that the ideal desirable theoretical model of the most efficient organization is the ‘bureaucratic” model. Weber argued that this type of model will be the only social organization that will overcome human faults and weaknesses. His organization will leave much longer than the individuals who are working for it. People will have to adapt themselves to the organizational needs and demands and not the other way round. He wanted to fulfill the old cliché saying “The graveyards are packed with people who thought they were irreplaceable”.

Just for the sake of argumentation, I’ll point only two of the criticism on Weber’s model:

One – Bureaucratic organizations suffer of stagnation. When a “big business” wants to react to changes in its businesslike environment its got to be someone whose job is to detect such changes and to call a meeting of the right forum which is nominated in advance to take care of such cases and according to the firm regulations to make decisions which will be accomplished by those who will be appointed to the task. Such a procedure is taking a lot of time while small business are reacting immediately and move forward leaving the big businesses behind.

Two -  The biggest enemy of the bureaucratic organization is the informal organization within the formal one. A lot of money, time and energy are wasted trying to overcome the influence of the informal organization. In small businesses, which are informal by nature, there is no such problem.

As a metaphor we can compare big and small businesses to a steam ship and a sailing boat. In the big steam liner, even if the crew members know each other personally, they operate a daily routine under strict regulations carried out by formally ranked officers and other commissioned lower ranked staff. If the weather will change and threat the ship safety, no one will react without a strict command issued by the captain. In the small numbered crew of a 40 feet sailboat there are no ranks or strictly defined jobs. Everybody is doing everything which is needed when it is needed to be done. There is a Skipper but in case of a sudden hazard you can carry on each sailor that he’ll do what’s necessary without waiting to be told what to do. In small teams, who are operating in a stressed environment, a small boat in the big blue sea or a small business in the jungle of the wild markets, crew members know that if they wouldn’t operate shoulder to shoulder they will be hanged neck to neck. The friendly commitment to each other is working for the benefit of the organization.

A online print shop is a classic example of a small business. It is organized by the following departments:

Management and administration (3)

Sales and marketing (3)

Accountants (2)

Customer service (3)

Graphic artists studio (5)

Printing machines operators (3)

Production and finish (7)

Shipping (2)

Business development and Internet support (2)

Those 30 workers are crowded in 100 square meters shop including machines and furniture.

The print shop is operating on line and off line.

On line, through the Internet, they offer the classical advertising and promoting printed materials like: Business cards, magnets, fliers, stamps, account books, envelopes, letterheads, invitations, stickers, bookmarks, and so on.

Off line, when the customer arrives in person and orders his request face to face. This is when the products are “heavy” like: books, catalogs, folders, small paper made packing materials, and such.

The small number of employees, operating under the right managers leadership, creates consolidation, unification, integration, and forging “team spirit” based on interpersonal relationship which creates an identification, involvement and empathy with the business goals. The lack of distance between managers, foremen and other employees do not harm discipline and high standards of working moral and ethics. Discussions, which are taking place from time to time, in open forums, enable all workers criticize constructively or suggesting improvements. Workers can express themselves freely in periodical interviews and all channels of communication, including internal E-mailing, are open unlimited. The closeness relationships enable flexible positioning workers in different stations according to various burdens. The outcomes of 30 workers is synergistic by nature and much more than just aggregative.

Poor financing is the number two reason small businesses fail, falling right behind poor management. Sufficient funding is paramount to the success of small businesses, and small business grants can be the answer to the problem. If business owners have the necessary knowledge about how to find and properly request grants, they have a better shot at creating a successful business that will be open longer and prosper.

There are over 300 different grants and loans available for small businesses that are just starting out. The grants range from $25,000 up to $1,000,000 depending on the size and projected success rate of the business. There are also grants available to help small businesses grow or expand. Grants are not the same as loans because they do not have to be repaid. A grant is considered free money, as well as an investment to promote the success of small businesses and the U.S. economy. Money for grants comes from income taxes. Obtaining a small business grant does not require credit checks or deposits, even if the owners have experienced bankruptcy in the past.

There are a number of helpful websites that send small businesses government grant packages for free, excluding the cost of shipping. These packages include information on how to find grants, how to prepare a grant request, and how to apply for grants pertaining to a specific business. Some of the providers are Government Funding Solutions, Grant Master, and Grant Wizard.

It is important to be familiar with the Small Business Administration’s (SBA) rules for receiving grants before beginning the process of obtaining one. Although the SBA does not provide grants to small businesses, they do provide helpful suggestions and resources on how to find grants.

In order to qualify for a small business grant, individuals must first become familiar with the 13 CFR 143 document that lists all of the requirements to be eligible for a grant. This document includes information on the pre-award and post-award periods and defines all aspects of applying for a grant and states who is eligible. The CFR is the primary source of rules and regulations for small business grants and must be read before starting the grant writing process.

After reviewing the requirements, prospective business owners must write a grant request. There are professionals who will write a grant proposal or the individuals may complete it themselves. The Catalog of Federal Domestic Assistance is a helpful site that links individuals to resources about federal grants for small businesses. Afterschool.gov gives helpful tips on how to write a small business grant and, although it is geared toward grants for after school programs, includes helpful information for grant writing in general.

Additionally, there are many well-established government and private organizations that provide grants to small businesses. The Department of Justice’s Ten Grant document gives access to grant opportunities for those conducting research in support of law enforcement. The Department of Labor’s Employment and Training Administration has several grant opportunities for small business owners. They offer about $125 million to businesses that are based in a community setting with special attention to training programs. The Department of Transportation is another organization that offers small business grants. They offer grants to any business willing to help resolve the growing problems with the federal-aid highway program. The Department of Education has a program called e-GRANTS that locates electronic grants online. They have a detailed list of grants available and the necessary applications to fill out. There are a variety of grants available for different groups, all of which have detailed descriptions and contact information. Other organizations that provide small business grants include the EPA, the National Cancer Institute, NOAA, the National Endowment for the Humanities, and the U.S. Department of Health and Human Services.