New Business Finance Funding

Business finance has never been in the news more than it is now and justifiably so. The lack of liquidity is having a stifling effect on businesses looking to restructure finances to provide liquidity in today's market, and it could have a knock on effect in many ways. An incredible £76bn of commercial property loans require refinancing before the end of 2010.(1) If they are unable to achieve this, businesses and property will come under a double dip pressure. There are concerns of banks having significant category hits. Not surprisingly they are now finding out that they did not know what they had invested into. This is causing them considerable uncertainty in terms of their own balance sheets and exactly what they are exposed to. Naturally they will be very concerned about what they will now invest into. I am not in the habit of catching falling knives, and this market is falling, and it's only with clarity of what is really out there that banks will feel the ground unde...

Small business owners are usually confronted with a number of challenges. One of them is getting business financing. Although most entrepreneurs start their businesses with their own funds, or those of friends and family, soon they reach a point where they need additional funding to grow the business. One solution is to look for additional financing among your friends. This is a risky strategy since there is a risk of losing the friendship if you run into business problems. Another solution is to try to go to the bank for a business loan. However, to qualify for a bank loan, your company usually needs to show three years of profitable operations and appropriate collateral assets. Generally, this puts business loans out of the reach of most small business owners. Two alternatives that are often overlooked by businesses are factoring and purchase order financing. Both offer great flexibility and are much easier to obtain than conventional business financing. Invoice Factoring Do hav...

Working through the rigorous chain of processes, trying to secure a license or permit to start a business or trade can be difficult enough, now add to that the great worry for most; how do I raise the capital? For long this question has been recurring, experts in the field of business finance have turned out series of books and articles on the best ways of raising the necessary funding, but if one looks closer, you will discover that as the capitalist society is class ridden, so does it affect the rules as they relate to business finance. I would want to draw attention to the funding options available to the poor, or putting it more correctly; the financially challenged. From my observation, it is clear to me that on average, the poor pay more for services than the well off in the same city. If you think this to be farfetched, then consider how much a family occupying a one room shack pay to buy water from a selling point on a daily basis as their deprived neighborhood is not conn...

Every organization regardless of its size and mission may be viewed as a financial entity. Management of an organization, particularly a business firm, is confronted with issues and decisions that have important financial implications. Questions must be answered like: o What kind of plant and machinery should the firm buy? o How should the firm raise finances? o How much should the firm invest in inventories? o What should the firm's credit policy be? o How should the firm gauge and monitor its financial performance? Business finance is broadly concerned with the acquisition and use of funds by a business firm. Its scope may be defined in terms of the following questions: How large should the firm be and how fast should it grow? What should be the composition of the firm's assets? What should be the mix of the firm's financing? How should the firm analyze, plan and control its financial affairs? In general, business finance rests on the premise that the objective of t...

Business needs funds for its smooth functioning. Funds carry same importance as blood in our veins. In other words, it is really difficult to imagine a business without funds. Usually, financial market has number of sources that provide finance for business. But, the best source among them is business financing and commercial loans. Business Financing and Commercial Loans can be availed through banks, financial institutions or from various building societies. Due to this neck throat competition, the borrower can get competitively low cost for Business Financing and Commercial Loans. Business Financing and Commercial Loans can be used in following ways: o To start a new business or, o Investing in existing business or, o Buying machinery and equipments for business or, o Consolidating business debts etc. Business Financing and Commercial Loans can be availed in two ways that is by placing collateral and without placing collateral. Both are good in their own way. So, the borrowe...

Various strategies for cost control will be helpful for most small businesses trying to cope with reduced sales volume. Business planning and consulting are likely to be among the most effective alternatives to help small business owners deal with recent distressed financial conditions. The need for new business planning tools is rarely a high priority for a company that is not experiencing one or more substantial problems. However even for the most healthy business, contingency plans are advisable. The value of contingency planning for business financing is sharply illustrated by recent examples of banks suddenly eliminating commercial loan programs with little or no advance notice. The level of chaos that currently prevails throughout commercial banking unfortunately means that changes can continue to occur with little warning. Business consulting will often not be thoroughly considered by small businesses because of the potential cost. As with any any other corporate service, c...

There is a form of business financing that is debt-free, with no loss of ownership or control.  It is very quick and still readily available.  It is the only form of finance that grows as fast as invoices.  There is no minimum time in business or collateral requirement.  The client's personal or company credit is usually not important.  Prior liens are usually not a problem, so long as they're disclosed up front .  (Factors don't like surprises.  A deal that could have worked will probably die if the factor's due diligence turns up undisclosed liens.) This form of finance is called factoring.  Say your company (the client) provides a product or service to a customer, then issues an invoice for those goods or services.  The customer frequently takes 30-90 days to pay the invoice.  Rather than wait, the client can sell the invoice to a third party, called a factor.  The factor will verify that the invoice is valid and t...

Depending on whose stats you pay attention to, approximately 80% of small businesses fail within their first 5 years of operation. In many cases, its not that a particular business could not succeed; there just wasn't sufficient time to figure out how to succeed. Which brings us to the worst small business financing strategy ever. Here's how it work. The would be entrepreneur develops what they believe to be a sure fire business plan that can't fail. Unable to locate any form of start up capital, they start their business with credit cards as the only source of financing, and an expectation of sustainable business results within 3 to 6 months. If everything goes well, the debt will be retired within a year and funds will start building in the bank account. Sounds Good, right? I mean the thinking lines up perfectly with all the get rich quick business opportunities that exist on and off the internet today where some of them even try to convince you to use your credit ca...

Over the last few years we have heard ad nauseum about small business struggles with accessing capital for growth. But, even harder hit then your typical Main Street business has been those companies that have yet to open their doors - Start-Up Businesses. Start-ups have always struggled at getting capital before launching their businesses. They have no revenue, no real prospects, no assets and no brand name. In fact all they really have is a hope and a prayer. Thus, no lender or investor in their right mind would touch a start-up business - and they usually don't. But, year in and year out, some 600,000 + new businesses are started each year; according to the Small Business Administration. These businesses have to get funding somewhere. The question becomes, where? Each business is different and as such each may find a different or unique way to scrape together the capital needed to launch their company. Some new businesses have to either cash out all their personal resources...

Your small business demands products; chairs, copy machines, faxes, and additional. You aren't confident in the finest strategy to handle funding the tools. Must you lease, obtain, what? This post will appear on the distinct ways apparatus finance is usually handled. Equipment finance could be accomplished as a result of four major alternatives. Loans, leasing, municipal leasing, and leasebacks are what we will focus on right here. Remember, the selection you pick out for the company will vary depending upon your organization demands and your small business enterprise credit rating. Equipment Loans: this financing selection permits you to buy the gear through either traditional or non-traditional loan possibilities. Utilizing a loan involves fine economic histories, credit ratings and debt-ratio scores. The gain of utilizing a loan to buy your products is that in the end from the repayment period, you now individual the gear. It is possible to get pleasure from all of the rewa...

So many times small business (and medium-sized business) owners say, "I need money, I wonder if I can get a bank loan?" Or if they are technology company owners they say, "I need money. I wonder if I can get angel investors or venture capital?" I say to this, HOLD UP! Do not jump the proverbial gun. There are some other questions you need to ask otherwise you will immediately limit your focus to one or two particular sources of small business financing. Put another way, if you hone in on the "how" too quickly, you shut down your imagination and limit your options. To broaden their perspective, business owners and executive management must focus on the "why" and the "what". These are the questions you need to ask FIRST: • How much money do I need? This is a crucial question. Yet there are so many business owners who cannot answer this question. The amount you need is a big driver of the best source of the financing. The true amount ...

It is frequently a good idea to get back to basics, and this is particularly appropriate for small business owners when they are reviewing if they can increase their cash flow with business cash advances while reducing processing costs. Because many businesses have experienced both decreased sales and increased difficulty in obtaining bank financing, this review of basic working capital management processes should be helpful to most commercial borrowers. The possibility of reducing a significant business expense is likely to be appealing to even the most successful small businesses. While they will not be discussed here, there are other working capital financing options to consider for a business which does not accept bank cards from customers as a payment option. A minimum monthly volume of bank card sales which typically varies from $5000 to $10000 is needed in most cases to obtain business funding based upon credit card receivables factoring. A lump sum payment is received base...