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Monthly Archives: October 2018

Grow Business With a Bad Credit

Bad Credit Equipment Finance for Growing Business

Equipment Financing is short-term loans (about 3-5 years) extended to businesses specifically to purchase the equipment needed for its operations. Equipment financing is a collateral loan which means that the equipment you purchased could be repossessed in case payments go into default. Since the loan is released with a collateral, lending companies view it as low risk and may offer a lower rate of interest compared to a standard loan.

To qualify for an equipment loan, one must have a credit score of at least 600, been in business for at least 11 months, and generate around $100,000 in revenue. If you have a bad credit but meet the other two requirements, there is still a chance for you to avail of a finance. It really depends on the lender’s assessment of your financial situation.

Equipment financing is an alternative for start-up and small businesses for growth and development especially for those who don’t have enough capital to fund their purchase. And if you have a poor to bad credit score, being granted an equipment financing gives you the chance to improve your credit score.

How to improve your chances of approval for equipment financing despite bad credit

You can increase your chances of an approval for equipment finance. By making ways to improve your credit standing and strengthen your application to lenders, there is a fair chance that loan companies will consider your loan application. Below are ways to strengthen your application.

1. Apply with a cosigner with good credit standing. Lenders can consider your application if you are applying with someone who has a better credit standing. The cosigner can provide security for the loan considering that the consignor has equal obligations as the borrower.

2. Present other assets for collateral. If you have other assets such as other types of equipment or even real estate property, you can offer it as a collateral. It strengthens your application to secure the loan.

3. Bigger down payments. Do you have enough cash to put as down payment to significantly lower your total loan amount? If you are able to present bigger down payments, lenders may consider you a candidate for poor credit equipment finance.

4. Proof to show business is growing strong. Provide documents like bank statements showing a good revenue for the past months. Lenders like to see a growing steady business, therefore, it is essential to provide income statements and other documents to support your claim.

5. Seek professional help. With bad credit, lenders will give you a hard time acquiring a loan. They may even deny the loan immediately after checking your credit score. But with proper assistance from loan experts, you can increase your chance of getting the right lender who can look beyond your bad credit.

Start Up Business Plan Ideas

Business plans have a number of functions – as a funding business plan, a marketing plan template, maybe as a joint venture offer. I have made a list of important things to include.

Start Up Business Plan Points

What business will you be in? What will you do? List all of your major products or services

Your Mission Statement: It’s a good idea to create a brief mission statement, usually in 30 words or fewer, explaining your business mission and guiding principles.

Goals and Objectives: Goals are destinations-where you want your business to be. Objectives are progress markers along the way to goal achievement. For example, a goal might be to have a healthy, successful company that is a leader in customer service and that has a loyal customer following. Objectives might be annual sales targets and some specific measures of customer satisfaction.

Business Philosophy: What is important to you in business?

To whom will you market your products? Identify your targeted customers, their characteristics, and their geographic locations, otherwise known as their demographics

Funding and Finance: How much initial investment is required? Where are you sourcing the funds from?

The Edge: What factors will give you competitive advantages or disadvantages? Examples include level of quality or unique or proprietary features. What products and companies will compete with you?

Price Points: What are the pricing, fee, or leasing structures of your products or services?

Your industry: Is it a growth industry? What changes do you foresee in the industry, short term and long term? How will your business poised to take advantage of them?

Legal Environment: Are there Licensing and bonding requirements, do you need Permits? Will your business need to register Trademarks, copyrights, or patents?

Key Financial Data: This includes Your business start up costs, ongoing costs, marketing costs, staff, wages and projected sales. You should calculate your break even points and make projections against your sales of how and when you will achieve this. Plan how much you need before startup, for preliminary expenses, operating expenses, and reserves.

Cashflow Forecast: Create a cashflow forecast. You should keep updating it and using it afterward. It will enable you to foresee shortages in time to do something about them-perhaps cut expenses, or perhaps negotiate a loan. But foremost, you shouldn’t be taken by surprise. There is no great trick to preparing it: A cash flow forecast is just a forward look at your checking account.

Describe your most important company strengths and core competencies. What factors will make your business succeed? What do you think your major competitive strengths will be? What background experience, skills, and strengths do you personally bring to this new venture?

Legal form of ownership: Sole proprietor, Partnership, Corporation, Limited liability corporation (LLC)? Why have you selected this form?

I have worked with many different types of business start ups and find that the most successful (and those who are still around) tend to be the owners who plan in advance. Forward thinking and solid planning contribute to the success of many start up businesses.

Women in Business

1. Explore the reason why. There are a variety of reasons why many aspire to start a new business. For some it’s about creating a life of greater meaning and purpose. For others, it’s an opportunity to gain more financial security, or answer a “calling” of sorts, among other things.

Whatever the motivation for starting your business, it must be something that resonates profoundly and becomes the fuel that keeps the flame from within ignited. Without a deep-rooted conviction for the reason why, you stand a real risk of throwing in the towel at the slightest hint of difficulty or challenge you will inevitably encounter with your business.

2. Bring “you” to the journey. Although you may be venturing into unfamiliar territory as a new business owner, it doesn’t mean you are starting from scratch. The reality is that you already come equipped with resources, skills and abilities to thrive as an entrepreneur.

There are many success traits all entrepreneurs possess: problem solving, communicating, collaborating, decision-making, and risk taking, just to name a few. Some of these traits have been honed and groomed from your career experiences, but they are also innate qualities you possess as a woman.

Trust and rely heavily on your unique life experiences and strengths as the greatest assets to accompany you at the start of your journey.

3. Take others along. You are a woman who juggles many life roles as professional, mom, wife and homemaker. Adding another responsibility to the mix as entrepreneur could tip the scale too heavy to one side, to say the least.

But this new role and responsibility doesn’t have to throw everything off balance. To avoid this, allow others to help you, get used to delegating more and give yourself permission not to be “super woman.”

Your family members in many instances will be your biggest fans, but be sure to get their buy-in from the start. Help them to see “what’s in it for them,” so that you experience less resistance and push back in the long run. Allow your family to be more self- sufficient. In so doing, you create a bit more “space” in your life for business development, without feeling guilty.

Also, consider your professional network. Are there any colleagues or contacts in your circle that can facilitate any aspect of business planning or development, more quickly and easily? If so, use this support system to jumpstart the process of building your business.

Business For Beginner Entrepreneurs

Write a business plan. If you are building a business from scratch, you definitely need one of these. Not only will it keep you focused and organized, but it will also help with funding. Banks and private investors want to see that their money is going to be well spent and that your plan is solid enough that they’re likely to get their money back.

Location, location, location. I know you’ve heard this one before. If your business is not home or internet based, you will need a physical commercial space. Do research and figure out what area would be best for the type of services or products you offer. You will have to balance that with things like commute, likelihood of disaster (I.e., robbery, flood, etc), and surrounding commercial buildings. Once you’ve got a general area in mind, it is time to shop around a bit and compare prices. Be prepared for steep prices for small space in comparison to residential property.

Get some funding. Once you have a business plan ready, you can present it to banks and try to get a loan. Alternatively, you can try and find an investor or two to give you some funding in exchange for a percentage of your profits. Either way, prepare for a lot of negotiating and a bit of a wait. Getting a loan approved, no matter the source, takes time.

Take care of the legalities. Before you can legally open, you will need to register your business, apply for a tax I.D. number, and make sure any and all permits and/or licenses needed are at hand and up to date. This sounds like a lot of work, and it is, but it is better than getting financially crippling fines, or even getting shut down. In addition, if you’re not a sole proprietor, you’ll need to learn the ins and out of hiring employees and related things like worker’s comp, unemployment, and things like that.

Promote. Once you have everything set up, get the word out about your business so you can start making a profit. Hopefully you covered methods for doing this in your business plan. Even so, there are always new ways to let people know about your business so it’s a good idea to continually revise your marketing plan.