Rebuild your credit with a $500 to $750 credit builder loan

Credit builder loan of $500 to $750 to rebuild or establish credit for residents of Georgia, Florida, New York, Puerto Rico, or Massachusetts.  http://www.acdfinancial.com/creditbuilder.htm

Use It As You Need It Small Business Financing

A factoring company like ACD Financial Services (www.acdfinancial.com) offers clients a “use it as you need it” funding option. Each invoice purchase is a separate transaction and does not form part of a portfolio lending approach. The transaction is modeled as a buy-sell transaction. ACD Financial first undertakes a due diligence that typically takes one to two business days. Once completed the client is at liberty to offer invoices for purchase. Upon receipt of invoices, ACD Financial checks the credit of the debtor named on the invoice and makes sure that the sale represented has been satisfactorily completed. Once this is done the debtor is advised of the purchase by ACD Financial and the client receives their funding. At the end of the credit period the debtor pays ACD Financial directly completing the transaction. #smallbiz

Benefits of Accounts Receivable Factoring

Here are some of the benefits of using accounts receivable factoring companies:

·         Get cash in 24 hours for first time applicants.

·         Customers can receive cash in less than four (4) hours.

·         There are no minimums, and no maximums.

·         Factoring is not a loan. There are no obligations.

·         You pay no upfront fees and no co-signers are required.

·         There’s no account to open.

 

 

How to Raise Start-up Capital in 2011

 

 

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How to Raise Start-up Capital in 2011

via Inc.com by Ilana DeBare on 12/14/10

Raising capital for a brand-new business has never been simple, and the continuing recession of 2009 and 2010 made a tough challenge even tougher. Start-up funding may be a little easier to come by in 2011, but securing adequate capital is likely to remain an uphill battle for many aspiring entrepreneurs.

On the down side: Banks are still being much more conservative in their lending than before the recession. Venture capitalists and angel investors are also much less willing to take risks than they used to be.

On the up side: Microlenders can now make loans of up to $50,000, an increase from past limits. There's also a new Internet marketplace of peer-to-peer lending and investing that can provide small amounts of capital.

How can you beat the money crunch? Tilt the odds in your favor by understanding the wide range of capital sources, which ones are appropriate for you, and by making sure you have a solid and well-thought-out business plan.

Raising Start-up Capital in 2011: Go Back to the Bank

One of the main capital sources for small business has traditionally been bank loans backed by guarantees from the U.S. Small Business Association. Of course, that's not so simple these days. Banks sharply tightened their lending criteria in the wake of the mortgage crisis, and the amount of SBA-backed loans dropped from $28.5 billion in 2007 to $17 billion in 2009.

Federal incentives have fostered a small rebound in SBA lending, up to $22 billion in fiscal year 2010. But that's still far lower than pre-recession levels. Regardless of the state of the economy, banks are more likely to lend to established businesses than to a start-up.

"In today's economy, I'd say 75 percent of SBA lenders will simply not do a start-up," says Jerry Chautin, a volunteer SCORE business mentor in Atlanta and Sarasota, Florida. "So the first question you should ask of a potential lender is, 'Will you do a start-up?'"

To maximize your chances of approval for a traditional bank loan:
• Have a well-written business plan, as well as personal experience or very solid mentorship in the industry you're entering.
• Be prepared to put up personal assets (such as home equity) as collateral.
• Provide as much start-up capital yourself as possible. In the recent past, banks looked for a business owner to provide 20 percent of the capital, but now some will want you to kick in 30 percent or more. For restaurants, Chautin says, borrowers may need to provide 40 or 50 percent of the funding.

"The smaller the loan, the easier it is," says Scot Cunningham, a consultant on SBA loans in Moraga, California. "And the more money you have into it, the easier it gets."

Will your business be located in a low-income area? Is one of the owners a veteran? The SBA has special programs to encourage these kinds of businesses.

Dig Deeper: How to Use a Personal Asset Loan for Your Business

Raising Start-up Capital in 2011: Check out Microloan Possibilities

If you can't qualify for a conventional bank loan, consider a smaller loan from a microlender—a nonprofit economic development organization approved by the SBA.

Microlenders provide training and mentoring, along with loans of up to $50,000—a cap that was increased in September from $35,000. They will consider borrowers whose poor credit history or lack of collateral sets them off-limits for regular banks. So they can be an ideal source of funding for a start-up with relatively modest cash needs.

"Because most microlenders are community-based, they have a simplified application and less stringent underwriting criteria," says Mark Allio, regional director of the Massachusetts Small Business Development Center, located at the University of Massachusetts at Boston. "They've historically been focused on neighborhood, Main Street-type businesses or entrepreneurs with credit challenges. They typically, although not always, charge a higher interest rate."

You can find a list of microlenders in your region on the SBA website.

Dig Deeper: How to Get Financing When Banks Won't Lend

Raising Start-up Capital in 2011: Consider Peer-to-peer Lending

Here's an option for entrepreneurs that didn't exist five years ago—borrowing money directly from other individuals via the Internet.

Peer-to-peer or P2P lending allows people to list and bid on loans using an online auction platform—a kind of eBay for lending. The two biggest peer-to-peer lenders in the U.S. are Lending Club and Prosper, both of which offer unsecured loans of up to $25,000. Most borrowers are seeking funds for personal reasons such as reducing credit card debt or paying tuition, but some are small business owners looking for capital.

"One of my clients with a yoga business couldn't get funding anywhere else because of her credit score," says Gwendolyn Wright, a small business coach with The Wright Consultants and the Renaissance Entrepreneurship Center in San Francisco. "It was a little expensive, but she got a loan of about $20,000 from a peer-to-peer lending site, and she got it within a week."

There are also some even newer "crowdfunding" websites that allow entrepreneurs to raise small amounts of capital such as a few thousand dollars in exchange for a share of revenues. Some examples are ProFounder.com, Peerbackers.com, Kickstarter.com, RocketHub.com and IndieGoGo.com. But there's no guarantee you'll be able to get as much cash as you need: Only ten percent of IndieGoGo borrowers get all the money they're seeking.

Dig Deeper: How to Find Alternatives to Bank Financing


Raising Start-up Capital in 2011: Seek out Venture Capitalists or Angel Investors

Many aspiring entrepreneurs imagine hefty injections of cash from venture capitalists or angel investors, but in fact these groups of investors focus on a very narrow sliver of businesses.

Both VCs and angels (not to mention the new breed of super angels) typically invest in companies that promise a very high rate of return and a clear exit strategy through a public stock offering or acquisition. They focus on industries like tech and biosciences rather than Main Street businesses such as individual restaurants, retail stores, or service firms.

That's in the best of times. And in the past two years of recession, VCs and angels have pulled back even in the technology sectors.

"If you're developing something where they can see a direct, clear path to an acquisition – for instance, something that Facebook or Apple wants—then there will be interest," says Michael Doherty of Doherty & Associates, a business-consulting firm in San Francisco. "But you need to have already demonstrated [buyer] interest or customers. VCs want to provide the bump that finalizes what you're trying to reach."

Dig Deeper: How to Pitch to Angel Investors

Raising Start-up Capital in 2011: Keep it Close to Home

People who know you are the ones most likely to help you, either by lending you money or investing in your business. Approach friends and family like you would a bank, with a clear business plan, terms of the loan or investment, and even a PowerPoint presentation. Put everything in writing.

And keep in mind that being in business together can dramatically change personal relationships—even ruin them, if not managed carefully.

"I went into business with a guy I'd known for 10 years, and in the business he was nothing like what he was in our friendship," says Allio. "But often friends and family are the only source of funding. So I'd recommend it be structured as debt rather than ownership. A loan you can always pay off, but it's not so easy to get out of a business partnership."

Dig Deeper: How to Pitch Your Business to Friends and Family

Raising Start-up Capital in 2011: Home Equity and Credit-Card Financing

It's not glamorous or sexy, but personal credit cards and home equity lines of credit are the way that many small businesses get going. The strategy here is to rely on your personal finances to get the business up and running. Then, once you've got documented sales and cash flow, you can turn to a bank for expansion capital.

Dig Deeper: How to Build and Maintain Good Business Credit

Raising Start-up Capital in 2011: Stretch Your Start-up Dollars With Leasing and Financing

Equipment leasing and vendor financing are two ways to make limited start-up money go further. Equipment leasing allows you to avoid coming up with cash to buy machinery or vehicles, instead paying a monthly fee to the leasing company. Shopping around among competing lessors can get you lower rates.

"Some of the equipment leasing packages are priced surprisingly aggressively," Cunningham says.

Similarly, you may be able to work out an arrangement with vendors where they provide the goods you need but don't require payment for 90 days or more. That can give you time to generate sales and achieve a positive cash flow.

 

 

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How one Boss Gave Away his Company for Christmas

 

 

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How one Boss Gave Away his Company for Christmas

via Inc.com by Eric Markowitz on 12/24/10

As he approached retirement age, Foss Miller knew he needed an exit strategy for the company he co-founded 35 years ago. It wasn't going to be easy.

His company, Sawbones Worldwide, presented unique circumstances. It wasn't that Sawbones makes artificial bones for medical use, which raises eyebrows. It was the company's location. It is the largest manufacturing plant, and largest employer, on Vashon Island in Washington State.

Vashon is a small island just west of Seattle in the Puget Sound with 10,000 full-time residents. It is accessible to the mainland only by ferry. There are no chain stores on Vashon, aside from a single Subway sandwich shop. Miller describes life on Vashon as the "Norman Rockwell existence."

With 135 employees and a payroll of nearly $6 million, Sawbones is crucial to the economy of Vashion Island. K2 Skis, a sporting goods manufacturer, was originally headquartered on Vashon, but left nearly a decade ago for cheaper labor abroad. Residents still feel the sting. K2's move eventually left about 400 people jobless.

"It was a big hit to the island," Miller recalls. "Everyone was paranoid that the same thing would happen to us." But the company, which Miller co-founded in 1975, has prospered. According to Miller, it has carved for itself a niche in the medical supply field.

How to leave his company in good hands? Miller first met with venture capitalists and strategic buyers, but they couldn't promise to keep the company on the island. He then considered a management buyout, but when he ran the numbers, he realized it wasn't going to be feasible. It would be too expensive.

Eventually, he and his business partner, Denzil Miller, made their decision.

On December 10th, Miller assembled his employees in the cafeteria for their annual Christmas party. Miller took the microphone and before a crowd of hundreds of his employees and their families. He announced a decision that would change their lives forever.

Foss Miller gave his company to his employees. Using the government-sponsored ESOP, or the employee stock ownership program, Miller would segue out of his role as an executive of his company, and as of that day, he'd let his employees take full ownership of the business.

Pacific Research Laboratories, the company's official corporate title, is one of nation's largest purveyors of artificial bones. They manufacture everything from bovine pelvises to plastic skulls. Shoulders are available for rent by the week. The locals call it The Bone Factory.

Naturally, the crowd erupted in cheers when Miller announced his decision to give the company to his employees. With an ESOP, employees are guaranteed a piece of the company's equity, which functions much like a 401k retirement plan. Since company profits are essentially reinvested into the employees retirement accounts, ESOP employees can genuinely enjoy the fruits of their labor. And as the employee grows with the company, so does his or her equity.

In addition to a number of tax advantages both employer and employee enjoy using an ESOP, what's notable is a common thread among ESOP programs: a strong company culture. The Sawbones story, which was originally reported by Vashon's local newspaper, The Beachcomber, is not as uncommon as yone might think.

Michael Keeling, president of the Washington-based ESOP Association, estimates that there are currently around 10,000 ESOPs nationwide, though precise statistics are impossible because most of these companies are private, and don't open their books to the SEC.

"The ESOP is a very attractive alternative or model for existing shareholder," Keeling says. "It keeps the culture and style going versus having new owners come in, shut it down, ship the machinery overseas, and cut the jobs out. I could make the case that if you have a great culture, the ESOP can be essential in preserving that culture, and probably make it better."

Though the popularity of ESOPs has steadily declined since the 1980s when government-sponsored tax incentives were repealed, ESOPs seem to be creeping back into the spotlight. There are a couple of reasons for this. For one, the recession has made venture capitalists a bit more conservative about their offers to small business owners like Miller.

"ESOPs have become a more appealing way for owners to cash out their equity because the downturn has lowered what most companies would fetch in a merger or acquisition," BusinessWeek noted about the recent rise in ESOPs.

Perhaps another reason for the reappearance of ESOPs is a little less quantifiable. As buzz words like "sustainability" permeates the corporate lexicon, CEOs and managers are beginning to understand that strong company culture can affect the bottom line. Low turnover rates, high productivity, and a sense of loyalty contribute to the intangible assets of a small business.

Companies such as Eileen Fisher and Publix Super Markets have announced ESOPs in the last several years, as well as Clif Bar Company, maker of the popular organic health food, which was announced in June 2010.

Clif's owners, Gary Erickson and Kit Crawford, implemented the ESOP "to recognize employees' role in helping build the business, and because it is in line with their goal to lead a sustainable business for future generations," according to a company statement. Erickson and Crawford sold 20 percent of their family shares to employees while retaining 80 percent ownership.

"All along we wanted to create a company where we would want to work," Crawford said in a statement. "Employee ownership is one more way we could run a different kind of business: one that inspires a team of people to make the kind of delicious, nutritious food we'd like to eat, and that strives for a healthier, more sustainable world."

When the news was announced at Clif Bar, employees could barely contain their joy. "Dancing in the aisles is definitely the right way to put it," said Renée Davidson, a company employee. "It was a big surprise. Employees had no idea it was coming. They were amazed."

ESOPs don't work for every company. But for Miller, who made his first worktable by taking his bedroom door off its hinges and laying it over two sawhorses, selling Sawbones to his employees just felt right.

"So many of the employees have worked here for many, many years," he says. "Providing them a great retirement when they leave—it just made more sense and felt better and better."

 

 

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How to Perform a Break-Even Analysis

How to Perform a Break-Even Analysis

via Inc.com by Ilana DeBare on 12/15/10

A break-even analysis is a key part of any good business plan. It can also be helpful even before you decide to write a business plan, when you're trying to figure out if an idea is worth pursuing. Long after your company is up and running, it can remain helpful as a way to figure out the best pricing structure for your products.

It sounds complicated, but it's not. Basically, a break-even analysis lets you know how many units of stuff—say, how many ham sandwiches, iPhone apps, or hours of consulting services—you must sell in order to cover your costs.

You'll need several basic pieces of information:
• Fixed costs per month
• Variable costs per unit
• Average price per unit

Performing a Break-Even Analysis: Fixed Costs

Fixed costs are ones like rent and administrative payroll that don't change much from month to month, regardless of how many units you sell. SCORE lists many common fixed costs.

"Be sure to include everything," says Jerry Chautin, a volunteer SCORE business mentor in Atlanta and Sarasota, Florida. "People forget about things like deposits or contingency funds, which can add up to a sizable amount."

If you're creating a business from scratch, don't rely on guesswork to estimate your costs. Chautin suggests asking the utility company for the past year of bills for your location. Call an insurance broker for a real quote for your particular business. Check with trade associations or web sites such as www.bizstats.com for information on average costs in your particular industry.

Dig Deeper: Exploring the Break-even Analysis

Performing a Break-Even Analysis: Variable Costs

Variable costs are ones like inventory, shipping and sales commissions that rise or fall with your sales volume. As with fixed costs, talk to trade associations, vendors and even other business owners in your field to come up with the most accurate estimate.

"Look up the financials of public companies in your industry: 10-Ks, which are annual disclosures, or 10-Qs, which are quarterly," Chautin says. "Even though those companies are much larger, you can size it down. The ratios are not going to be that far off."

Dig Deeper: Break-Even Analysis Chart

Performing a Break-Even Analysis: Pricing

This is the trickiest of your three pieces of data, since you're able to choose exactly where to set your prices. Start by looking at your competition, and how they price their products. You can also do informal focus groups to see what people might be willing to pay for your wares or services.

"You can look at pricing many different ways," says Gwendolyn Wright, a small business coach with The Wright Consultants in San Francisco. "How's your competition pricing it? Do you want to be at the midpoint, higher end, or lower end? I see people pricing earrings at three times what their competitors are charging. Why would anyone buy that?"

You'll also need to consider your costs when setting prices. If you spend $2 on meat and condiments to produce a hamburger, you'll obviously need to price it at more than $2. But how much more—$4? $5? $7? That's where a break-even analysis can come in handy.

Dig Deeper: Break-Even Analysis in Inc. Tools

Performing a Break-Even Analysis: The Formula

Once you've got your cost data and a target price, plug them in to this formula:

BEQ = Fixed costs / (Average price per unit – average cost per unit)

This will tell you your break-even quantity (BEQ), the number of units you need to sell to cover your costs. Any sales above that are pure profit. Anything below means you're losing money.

Here's an example. Suppose you're turning a jewelry-making hobby into a business. You have $1,000 per month of fixed costs (studio rent, utilities, equipment, etc.). Your variable costs for each necklace are $50 for materials and labor. You'd like to charge $70 per necklace, since that's what similar pieces are selling for.

BEQ = $1000 / ($70 – $50) = $1000 / $20 = 50

That means you'd need to sell 50 necklaces a month at $70 each in order to break even.

Use your break-even formula to compare different pricing strategies. For instance, if you raised the price to $80, you'd only need to sell 33 necklaces—but it might be harder to attract buyers.

On the other hand, if you lowered the price to $60, you'd attract bargain shoppers—but would need to sell 100 necklaces to break even.

The break-even formula can help you compare different cost structures as well as prices. For instance, suppose you used less expensive materials in your necklaces and pared the unit cost down to $45. The formula tells you that you'd have to sell just 66 necklaces at $60 to break even.

You can use a basic Excel spreadsheet to run different break-even scenarios, or download one of many break-even templates available online.

Dig Deeper: Break-Even Analysis, a Basic Calculation

Small Business Planning for 2011

Some of the best small business planning tips come from SCORE.  If you are like many people today who have lost their corporate jobs, you might be starting a new small business.  Here are some of the best tips for planning:

Take the time to define your business idea.

Be able to talk about your business in an elevator pitch. (3 minutes.)

Write down your mission statement.

Think about what your motives are, and be sure you have a passion for owning your company.

Commit to the frustrations,  time, education and that you may encounter.

Learn about your competitors - their products, service, distribution methods, pricing, and advertising.

Think about any outside influences that could affect your new business.

Always reserve small business factoring as a standby method of maintaining your business:  paying employees, bills, suppliers, and production or manufacturing costs. Seek a factoring company like ACD Financial Services to talk with about how invoice factoring can help keep your business on track.

 

Determining the legal structure for your small business (free online workshop)

Here is a free online workshop from SCORE that provides a good overview to help you determine the best legal structure for your business.  It covers Sole Proprietorships, Partnerships, Corporations, and Limited Liability Companies (LLCs)  http://www.score.org/Legal_Structure.html  #smallbiz #Tennessee #Georgia

Non-profit working capital loan program criteria

Working capital financing with terms of 1% to 1.5% per month for eligible non-profits with short-term capital needs.

 

Eligibility:  501 ( c) 3 organizations in Georgia and Tennessee.

 

Amount: up to $10,000

 

Interest Rate: 1% to 1.5% per month

 

Term: up to 6 months; can be extended for another 6 months

 

Collateral: Generally a first lien on cash and investments, contracts and accounts receivable and present and future contributions.  Approval may require other or additional support

Fee: $100 due diligence fee

 

 

Adrian Davis

678-868-1885

www.acdfinancial.com

 

#nonprofit #Tennessee #Atlanta

 

 

 

Veterans Starting Their Own Business

The SBA reports that nearly one quarter of veterans say they're interested in either buying or starting their own small business.  Interestingly, that percentage is even higher among female veterans. But the bad news is that financing is difficult for new business owners since the recession.

Veterans will be happy to know that accounts receivable financing can assist them in the start-up phase of any new venture, when cash flow may be tight. New business owners often use factoring to help pay for employees, and cover bills and expenses until their business is up and running strong. There are many factoring companies nationwide, but for more information on invoice factoring, go to www.acdfinancial.com.

 

10 worst credit card mistakes

http://articles.moneycentral.msn.com/Banking/CreditCardSmarts/10-worst-credit-card-mistakes.aspx

Chase Doubles SBA Loans to Become #1 in U.S., Helps 3,300 Small Businesses in 2010

If banks are making small business loans, why is it that small businesses are unable to obtain financing.  Invoice factoring (financing) is easier to obtain than a bank loan.   http://www.marketwatch.com/story/chase-doubles-sba-loans-to-become-1-in-us-helps-3300-small-businesses-in-2010-2010-11-15?reflink=MW_news_stmp  #smallbiz

 

SBA Business Loan Program Expanded by SunTrust Bank

Here is some encouraging news for small business owners.  SunTrust Bank is expanding its small business loan program.  Please note that obtaining working capital using invoice factoring (financing) is easier than a bank loan.  www.acdfinancial.com.  #smallbiz

 

SBA Business Loan Program Expanded by SunTrust Bank
by _anitalancaster_ (http://businessservicenews.com/author/anitalancaster/)
on November 15, 2010

The SunTrust Bank has decided to expand its SBA business loan program and
business activities in a bid to attract more small business clients. The
bank also plans to focus on advisory and online services.

SunTrust is already training its business bankers according to client
needs. It is particularly giving training on cash flow cycles.

Similar step is being taken by a number of other banks in Washington.
SunTrust is planning to expand their SBA business loan program next year
with a team of SBA bankers. The bank believes that business banking is
becoming quite easier for the people who are in need of loan and it should play a
part is helping them at the cheapest rate.

Although steps taken by SunTrust focuses their existing product offers like
mobile banking and cash management evaluation, it also highlights their
overall marketing objectives. According to SunTrust’s regional president and
chief executive for greater Washington, Scott Wilfong, business bankers are
getting ready to help businessmen to expand their businesses in right way.
He also added that this is a holistic approach as well as a great way to
support and advice companies along with personal finances that will make
overall businesses healthier.

The SunTrust Bank is the sixth-largest SBA lender in Washington. The bank
is recognized for making 38 loans valued at $9.1 million for fiscal year
2010. It is the third largest bank in Washington with 180 branches as well as
$14.4 billion in deposits. It maintained a well reputation in banking
industry over the last several years.

 

Will you receive all of your income tax refund in 2011?

Call (800) 304-3107 begin_of_the_skype_highlighting to find out.  Your tax refund or a part of it can be seized for federal, state, or local debt from defaulted student loans, to unpaid property taxes, to child support, etc.  Call (800) 304-3107 and follow the automated system.  The auto-attendant will let you know if you are clear.  If something is flagged it will provide contact info for the agency wanting your tax refund.  #smallbiz #Nashville #Atlanta #Memphis

Don't let your small business run out of cash when you have customers that owe you money

Invoice financing can provide the cash you need.  It has been around for centuries so take advantage of this financial tactic.  ACD Financial Services (www.acdfinancial.com) can fund your outstanding invoices within 48 hours.

What your bank won't tell you when you can't pay your SBA loan

Small business owners have been severely impacted by the Great Recession.  If you are in default or about to default on your SBA loan there is a solution.  Contact us today at 678-868-1885 or www.acdfinancial.com for a consultation on an Offer in Compromise.  It's an SBA program designed to support a request for debt forgiveness.  #smallbiz #sba #Nashville #Atlanta #Memphis

Don't Let lack of Cash Flow Be The Reason Why Your Business Fails

According to the Small Business Association (SBA), only 30 percent of new businesses fail during the first two years of being open.  On the other hand,  50 percent fail during the first five years and a whopping 66 percent fail during the first 10. Only  25 percent make it to their 15 year or more anniversaries.

It is estimated, by the SBA, that over half a million businesses opened in the year 2009, while 660,000 closed. Out of the 552,600 businesses that started in 2009, about 165,000 or more are expected to fail by 2011, especially with the most recent economy.

Invoice financing can help small businesses that are cash poor because their customers are slow to pay.  Don't let your business fail because you are out of cash, but you have customers that owe you money.  Invoice financing has been around for centuries so take advantage of this financial tactic.  ACD Financial Services (www.acdfinancial.com) can fund your outstanding invoices within 48 hours.

 

Everyone Deserves A 2nd Chance

I recently had a conversation with a borrower with poor credit.  He stated to me that everyone deserves a 2nd chance.  I agreed until he told me how he was late paying his mortgage and a credit card bill, but expected to pay them on time next month.  #smallbiz

Business Start-up Tip

Today you need not open  an office for many businesses. Just set aside one private room in your home, and you'll be doing business. Employees can work from home as well, and you will save a  ton of money on office overhead. There are conference call in companies and webinar services for internal or external meetings. All you need to pay for is a webcam and microphone if offsite employees do not have them, etc.   And what's more, if you don't have a lot of cash yet in your new business, you can always rely on a factoring company.  #smallbiz #smallbusiness

 

Use It When You Need It

A factoring company can be invaluable to any start-up business, especially if it offers clients a “use it as you need it” funding option.  With this option each invoice purchase is a separate transaction and does not form part of a portfolio lending approach. The transaction is modeled as a buy-sell transaction. Typically a factoring company undertakes a due diligence that typically takes one to two business days. Once completed the client is at liberty to offer invoices for purchase. Upon receipt of invoices, the factoring checks the credit of the debtor named on the invoice and makes sure that the sale represented has been satisfactorily completed.  #smallbiz #smallbusiness

 

SBA Implements Larger Loan limits Established Under Jobs Bill

WASHINGTON - On the heels of completing final approvals of loans to nearly
2,000 firms that has been in its loan queue waiting for final approval of
the
Small Business Jobs Act, the U.S. Small Business Administration has finished

implementation of another major element of the bill: increasing maximum
sizes
in several of its loan programs.

The changes - effective today - are permanent for general small business
loans under SBA's 7(a) guaranteed loan program, fixed asset loans through
the
504 Certified Development Company program, Microloans, and International
Trade, Export Working Capital and Export Express loans. A temporary
increase
for SBA Express loans is good for one year.

"Across the country, there are small businesses owners who are in a position

to take that next step to grow and create jobs, and these larger loan sizes
provide another tool to help them do just that," SBA Administrator Karen
Mills
said. "Whether they're in the start-up phase and could use a microloan or
are
looking to take advantage of lower real estate prices and interest rates to
buy
a new building to expand, SBA loans can now be an even greater resource to
help entrepreneurs and small business owners get the capital they need.

"Additionally, temporarily increasing the cap on SBA Express loans from
$350,000 to $1 million will allow more small businesses to take advantage of

the streamlined approval process for working lines of credit and other
capital
they need," Mills said.

Under the Jobs Act provisions, SBA has permanently increased 7(a) and 504
limits from $2 million to $5 million, and for manufacturers and certain
energy-
related projects seeking 504 loans, to $5.5 million. The maximum for
International Trade and Export Working Capital loans also has been increased

from $2 million to $5 million.

SBA also permanently increased microloan limits from $35,000 to $50,000,
helping larger entrepreneurs with start-up costs and small business owners
in
underserved communities. It also raised the limit on Export Express loans,
from
$250,000 to $500,000, and made the program permanent.

SBA Express loan limits have been temporarily raised from $350,000 to $1
million for one year. These loans offer a streamlined application process
with
reduced paperwork and approval often in a matter of days. Unlike
traditional 7
(a) loans, SBA Express loans carry a 50 percent guarantee and can be used as

revolving lines of credit - to help restock inventories and support larger
revenue sales - which are particularly critical for small businesses as they

emerge out of the recession.

SBA's own trends show increasing demand for larger loans. The percentage of

lending volume for guaranteed loans greater than $1.5 million has grown,
from
13 percent of total dollars approved in fiscal year 2005 to 21 percent in
fiscal
year 2010, with many loans actually at the $2 million maximum. In the 504
program, the percentage of loan volume committed to loans greater than $1.5
million also has grown, from 15 percent of total dollars approved in fiscal
year
2005 to 25 percent in fiscal year 2010.

SBA has already put in place the alternate size standard that expands
eligibility for SBA-backed loans that was included in the Jobs Act,
increasing
the alternate size standard to include those small businesses with less than

$15 million in net worth and $5 million in average net income.

Additionally, Administrator Mills announced on Tuesday that all loan
applications placed in the SBA's loan queue by small business borrowers had
received final approval, amounting to 1,939 loans for nearly $970 million.
The
loans were able to make use of loan guarantees up to 90 percent and reduced
fees extended under the Jobs Act. Many of the loans had been in the queue
waiting for the extension since May.

The bill provided the agency with enough funding to support an estimated $14

billion in lending to small businesses with the extension of higher
guarantees
and reduced fees in the top two loan programs, first implemented as part of
the American Recovery and Reinvestment Act of 2009.

The Jobs Act also includes additional resources to help increase lending to
small businesses, including the State Small Business Credit Initiative
announced today by the Department of Treasury that will support $15 billion
in
lending through local programs and the Small Business Lending Fund, which
will
provide capital to local, community banks to increase their lending to small

businesses.

Additionally, the new law contains $12 billion in tax credits targeted to
small
businesses, including higher deductions for investing in new machines and
equipment, zero capital gains for those who buy and hold small business
stocks
for five years, and a doubling of the maximum deduction for startups to
$10,000. It also allows self-employed Americans to completely deduct health

insurance costs for themselves and their families.

How to apply for a SBA Express Loan for $5,000 to $50,000

http://www.sbaxpressloan.com/

How to receive free small business counseling

http://www.acdfinancial.com/index.htm #smallbusiness #smallbiz #Atlanta #Nashville #Memphis

How to apply for a SBA Patriot Express Loan

http://www.sbapatriotloan.com/

How to turn a $25,000 outstanding invoice into immediate cash

http://www.acdfinancial.com/index.htm

Do you have poor or no credit? How to apply for a $500 credit builder loan to restore and establish your credit

http://www.acdfinancial.com/creditbuilder.htm #smallbusiness #Atlanta #Nashville #Memphis

SBA Announces That 504 First Mortgage Loan Pools Assembled, Ready For Sale On Secondary Market

WASHINGTON - Bank of America and United Midwest Savings Bank have
become the first financial institutions to assemble SBA 504 first mortgage
pools
to be sold on the secondary market, the U.S. Small Business Administration
announced today.

The announcement follows the launch of the 504 First Mortgage Loan Pooling
program on July 1, 2010. Authorized as part of the American Recovery and
Reinvestment Act of 2009, the measure is expected to jump start the
secondary market for the first mortgage loans made in conjunction with
Section 504 Certified Development Company loans. The ability to sell loans
into this secondary market will provide liquidity to those lenders that want
to
partner with a Certified Development Company to provide real estate and
fixed
asset financing to small businesses.

"The 504 loan pool guarantee program is one more tool we've added to SBA's
toolbox to expand access to capital for America's small businesses," SBA
Administrator Karen Mills said. "By jump starting the 504 secondary market,

more banks will have greater opportunity to strengthen their liquidity and
in
turn increase their lending to small businesses and entrepreneurs."

Bank of America pooled $32.07 million in loans it purchased from other
lenders,
with $25.65 million guaranteed by the SBA. United Midwest Savings Bank
assembled a pool of $7.96 million, with $6.4 million guaranteed by the SBA.

Under the program, the SBA provides a government guarantee on pools of
portions of eligible 504 first mortgage loans assembled by approved pool
originators who sell them to third-party investors. Lenders retain at least
15
percent of each individual loan, pool originators assume 5 percent of the
risk,
and the SBA guarantees the remaining 80 percent.

Typically, a 504 project includes three elements: a loan (or first mortgage)

secured with a senior lien from a private-sector lender covering up to 50
percent of the project cost, a second mortgage secured with a junior lien
from
a Certified Development Company (backed by a 100 percent SBA-guaranteed
debenture) covering up to 40 percent of the cost, and a contribution of at
least 10 percent equity from the small business borrower. Brokers, or pool
originators, purchase portions of the first mortgages, package and sell them
on
the secondary market.

For additional information on the pool originators, visit
http://www.sba.gov/aboutsba/sbaprograms/elending/secondarymarket/index.ht
ml. The list will be updated regularly as new originators are approved.

Release Date: Sept. 29, 2010
Internet Address: http://www.sba.gov/news

#smallbusiness #smallbiz

How to apply for an unsecured small business loan for up to $100,000

http://www.acdfinancial.com/bizloan2.htm  #smallbusiness #smallbiz #Atlanta #Nashville #Memphis

Three Small Business Jobs Act Benefits

Let's take a look at three key provisions the Small Business Jobs Act offers small business owners:

 

1. Thirty-billion dollars will go directly to community banks specifically for lending to small businesses. According to Senate reports, small business lending has dropped by 17.8 percent since the year 2008. The Bill's money is expected to encourage small banks to increase lending, and once things get rolling, they expect the creation of around 500,000 jobs.

 

2. Startups will get bigger deductions in 2010 or 2011. The Small Business Jobs Act would increase the amount you are allowed to deduct in your startup costs from $5,000 to $20,000. Plus, you'll more favorable deductions for real estate related to their business.

 

3. Microloans will be available for to help create small and home based businesses by aiding in their short term capital requirements. Prior, a business could only access a maximum of $35,000 in microloan funds. These microloans can be used for up to five years to pay existing loan payments to continue growing the business.That amount increased to $50,000 with the passage of this bill.

Source: IFG Network

 

#smallbusiness #smallbiz

 

How to apply for a micro small business loan for up to $50,000

http://www.acdfinancial.com/microloan.htm   #smallbusiness #Atlanta #Memphis #Nashville #smallbiz

For Non-Profits - How to Convert One-Time or Annual Donors into Monthly Givers

A great article from Network for Good….Thinking about monthly giving is one of the smartest things you can do as a fundraiser. At Network for Good, we find that 30-40% of the donation volume for a nonprofit website is monthly giving, and that would be a great situation to find all nonprofits in-thanking people every month instead of asking them for donations every few weeks.

How do you do that? How do you turn your annual givers into monthly supporters?

• Make sure your donation form asks what type of gift the donor wants to make ("Do you want to give us a monthly gift?"). Whenever you're asking for money, ask for the monthly pledge, not just a one-time gift.
• Revisit the language you're using in your appeals. Frame your ask in such a way that it's a win-win situation-monthly donations for you, convenience and budgeting for your donors. (Read more about the four parts of a great fundraising appeal.)
• Package the appeal in an exciting way. For example, some organizations have an ambassador program or a sponsor-a-child every month program. Put a face on that sustainable gift. This way you're creating some tangible tie to the idea of giving every month. Remember: To increase charitable donations, you should appeal to the heart--not the head.
• Don't be afraid to ask for a monthly gift of support after someone completes a one-time transaction. It can be ingrained as a nice thank-you message: "Thank you so much for making a one-time gift. This is how you can put your support to work for us each and every month. Would you consider becoming a monthly supporter?" We've seen great success in converting first-time online donors into monthly donors by doing that within the first three days of them making their first online gift.
  
  
  **We’ve seen great success in converting first-time online donors into monthly donors by doing this within the first three days of the donors making their first online gift. Think of using this strategy during the holidays when you're experiencing high traffic of one-time gift donations!

By Katya Andresen and Alia McKee: Sep 23, 2010 and Network for Good

 

#Nashville #Atlanta #Memphis #nonprofit

Small Business Cash Flow Management (Online Chat)

Every month, SBA hosts a free online Q&A chat. This chat is about managing
cash flow. It will be Thursday, 9/30 @ 1 pm and the expert answering the
questions is Julie Brander, past chair of SCORE's New Haven Chapter.

Check it out at the link below.

http://web.sba.gov/livemeeting/Sep10/

 

 

#Nashville #Atlanta #Memphis

4,000 Year Old Tactic for Business Cash Flow

One strategic way for small businesses to find and use cash to grow centers around a 4,000 year old tactic called factoring.  This allows companies to move beyond reliance on loans, and borrowing money from credit cards to survive and grow. Invoice factoring or spot factoring, enables companies to get short-term working capital and improve cash flow and grow their businesses. Factoring makes  business success more predictable.

Since most companies do not get paid immediately for delivered products or services, spot factoring benefits businesses that do not get paid for 30, 60 or 90 days by advancing up to 90 percent against the company's invoices. A factoring company like ACD Financial Services purchases selected invoices at a discount.

#Atlanta #Nashville #Memphis #smallbiz #loan #non-profit

Source:  IFG Network

 

New Temporary Commercial Real Estate Program

Here is a program that might help small business owners who have purchased a
small commercial building or office or warehouse condo with a short-term bank
loan.  I am monitoring the program's status and will provide an update, but here is a short overview.

New Temporary Commercial Real Estate Program

The Small Business Administration is proposing legislation to temporarily allow small
businesses to refinance existing, qualified, owner-occupied, small business
commercial mortgages into SBA’s 504 program, which provides guarantees
supporting loans for the development of real estate and other fixed assets.
Currently, 504 loans must be used for new development or construction—and can
only include a limited amount of refinancing when businesses are expanding.

* Refinance Existing Loans into SBA 504 Structure: SBA’s existing
network of Certified Development Companies and private lenders already help
small businesses finance long term investments like real estate and heavy
equipment through a financing structure that includes a 50% private first
mortgage, a 40% SBA-backed debenture, and 10% borrower equity. With collateral
values falling and many banks pulling back on CRE lending, even
refinancing well performing loans has become harder. Under this new proposal,
borrowers with either existing 504 loans or conventional CRE loans could apply for
refinancing through the 504 program.

* Leverage Existing Infrastructure and Programs: SBA’s existing
network of Certified Development Companies and participating first mortgage
lenders will be able to deliver this program to borrowers quickly. Eligibility
would be similar to the existing SBA 504 program. Certified Development
Companies are SBA’s critical partners in this program, linking small
businesses and private lenders and helping to manage program risk.

* Target Performing Real Estate Loans: Eligible small businesses
will have commercial first mortgage loans or existing 504 first mortgage loans
that are maturing in the next year. In order to qualify, businesses will
have to be current on all loan payments for the previous year.

* Help Finance up to 90% of Current Property Values: Lenders that
are refinancing mortgages for existing customers will make a loan for up to
70% of the current property value; and SBA will help finance the remaining
20%. For lenders taking on a new refinancing project, SBA will take on a
greater share of financing, up to 40%.

* No Cost Program through Incremental Refinancing Fee: SBA’s
proposal for a temporary, zero-subsidy rate CRE refinancing program would be
funded through an additional fee for refinancing projects, and would not require
credit subsidy appropriations.

* Prevent Foreclosure: Borrowers can finance up to 90% of existing
property values through this program. By allowing eligible small businesses
to refinance their CRE mortgage into an SBA 504 loan project, this program
would provide creditworthy small businesses the opportunity to lock in
stable, long-term financing—and save jobs—by protecting small businesses from
unnecessary foreclosure.

* Free up Capital for Community Banks: Market research shows that a
large percentage of CRE mortgages are set to mature within the next few
years, and that nearly half of these mortgages are held by community banks. By
removing a percentage of existing CRE mortgages from their books, lenders
will free up capital that they can use to make more small business loans.

Source: SCORE

#smallbiz #Atlanta #Memphis #loan #smallbiz

ACD Financial Services www.acdfinancial.com

 

New Small Business Bill Expands Microloans

President Obama is expected to sign a new small business bill into law on
Monday. Here is briefly how the Microlending program will change, according to
GulfCoast Finance, a certified development company in Florida.

Microloans: Permanently increases the maximum per small business borrower
to $50,000 and per intermediary to $5 million. Also authorizes SBA to
waive intermediary match requirements during fiscal years 2011 and 2012.
Intermediary Lending Pilot: Establishes a 3-year pilot program to provide
capital to 20 non-profit intermediaries annually, to make loans targeted to
startup, newly established and growing small business concerns. CDCs should be
eligible to participate.

 

#smallbiz #loan #Memphis #Nashville # Atlanta

 

Source: SCORE Atlanta

The Great Recession is Over! Says Who

According to a panel of leading economists at The National Bureau of Economic Research (NBER), the Great Recession that began in December 2007 ended in June 2009.  Go figure.

 

The unemployment rate hovers around 10% nationally and 27 states saw their unemployment rate increase.  The residential real estate market is still shattered and most Americans have seen a substantial decline in their wealth. Small businesses that drive the economy and create the majority of jobs are unable to obtain capital to grow and expand.  I am sure most small business owners and consumers without jobs don't agree with these economists. 

 

Well, we don't either.  That's why at ACD Financial Services (www.acdfinancial.com) we are constantly working to help small business owners obtain the capital they need to be successful.

Determining Your Business' Capital Needs

Let's start with two definitions.

"Capital," in investing terms, is money used to finance purchases of equipment, supplies, or products. If you want to buy a new piece of equipment, the money you will spend to purchase that equipment is considered Capital.

"Working Capital" is the money you need to spend to cover the day-to-day operating costs of your business. Working Capital is cash − or accounts that can be converted into cash, like accounts receivable or inventory − and cash you need to spend to cover financial obligations falling due in the current operating year. To keep it simple, think of working Capital as the money you need to pay the bills.

So: To determine your Capital needs, you'll need to consider both Capital and working Capital; the total is the amount you'll need to operate your business.

Let's start with Capital you'll need to make major purchases. Potential sources of Capital outlay include:

• Buildings, facilities, etc.
• Major equipment.
• Office equipment and furnishings.
• Materials, supplies, parts, etc.
• Initial inventory.

If you are planning the Capital needs of a start-up, simply write down the costs of setting up the business. If you run an existing business and need Capital to expand, write down the costs of that expansion. (But don't include items like salaries, utility costs, insurance, etc − we'll get to those items in a moment.)

Then focus on your working Capital needs. To make it simple, we'll assume you run an existing business and are looking to expand. In that case, to determine working Capital requirements create projections for items like accounts receivable, inventories, and accounts payable. Then compare your current actual costs to the figures you forecast. Then subtract the increase in current liabilities from the increase in current assets. The difference is your change in working Capital and indicates how much money you'll need.

If you are seeking Capital for a start-up, it's even easier: You don't have current actual costs, so the difference in liabilities and assets equals your working Capital needs.

Here is an example. Say you plan to open a new restaurant. (We'll keep the math simple.) You estimate the following Capital costs:

• Facility (building and land)	$500,000
• Equipment (stoves, freezers, etc)	$150,000
• Furnishings (tables, chairs, etc)	$75,000
• Other items (silverware, plates, etc)	$20,000
• Etc.
Total	$745,000

You determine you require $745,000 in order to open the restaurant. But that is not all the Capital you will need; you'll also require working Capital to keep the operation going while the restaurant gets on its feet. You estimate the following in working Capital needs for the first twelve months you are in business:

• Salaries	$400,000
• Utilities	$25,000
• "Groceries" (supplies)	$50,000
• Advertising	$15,000
• Etc.
Total	$490,000

Adding Capital and working Capital together indicates you'll need $1,235,000 to cover the first year's expenses. (You'll probably need more, since neither list above is in any way complete.)

On the other hand, you will bring in cash as customers patronize your restaurant. You run a variety of different scenarios and decide you feel comfortable assuming you will do $800,000 in sales over the course of the first year.

The math is simple: $1,235,000 minus $800,000 equals $435,000. You need $435,000 in Capital to open the restaurant.

But take a step back first. While you have estimated you will do $800,000 in sales, those sales are unlikely to be spread evenly across twelve months; your first few months are likely to be lean as customers learn about your restaurant and your sales build over subsequent months. Plus you need at least $745,000 to cover the costs of getting the restaurant started.

In addition, to cover potential shortfalls, you decide you need an additional $200,000 as a buffer for lean months and in case unforeseen expenses arise.

Taking into account your initial needs, and a buffer, you determine you'll need a total of $1,435,000 for the first year, but since you expect sales to rapidly increase as customers flock to your restaurant, you cut that total amount by $300,000 because you can use income to offset some of your working Capital needs.

Then, to present a great case to investors and lenders, you lay out those Capital needs on a month-by-month basis, showing working Capital requirements and offsets due to accounts receivable. In short, you show lenders and investors what you need, justify those needs based on solid forecasts and estimates, and show how you will pay back the money you borrow. The key is to factor in Capital needs and working Capital needs; don't let your business fail because you didn't estimate and plan for working Capital required to cover operating expenses

 

Thinking About Starting A Non-Profit?

To create a non-profit you have to file articles of organization with your state government.   Before you do that, you should visit www.irs.gov and read Publication 557.  It is a must read if you are going to start a non-profit. To receive tax exempt status you must file Form 1023 with the IRS.   Form 1023 and instructions can also be found on the IRS's website. The reason why you want to read the IRS documents first is because filing articles of organization with your state's government does not grant you tax exempt status.  Only the IRS can do that if they approve your non-profit for tax exempt status. Tax exempt status allows donations to your non-profit to be tax deductible for your donors. Applying for grants involves finding organizations that provide grants that support your non-profit's mission and completing their grant applications.

Grants To Start A For-Profit Business

Grants to start a for-profit business do not exist.  Grants generally are for and support non-profit organizations.  Most start-up businesses get started with personal funds from the owner, a combination of a business loan and personal investment, or a combination of both and private investment.  You should  develop a business plan if you are thinking about starting a business.  You will need a business plan to obtain any type of funding and at a minimum to serve as road map to be successful. 

How To Control Spending

It really does not matter whether business is facing financial challenges, growing at a manageable rate, or booming, without oversight a company's spending can easily spiral out of control. Have you established company spending policies? Because if you have not,  it will be difficult to set boundaries, or create controls, let alone enforce spending policies. Anyone who runs a business - whether small or large - has expenses. As a small business matures the need for spending controls is eminent. Here are a couple of strategies to support the process.

One company known as ExpenseWatch.com can help  you control  expenses by offering best-of-breed modules for Expense Reports, Purchasing and AP Invoice Management, which can be subscribed to individually to control specific company spending issues, or as a fully integrated expense control suite. An open expense control platform, companies have the flexibility to integrate spending data with a wide range of business solutions used—travel management tools, accounting/enterprise resource management systems and payroll providers, credit cards, budgeting applications, customer relationship management systems, ecommerce vendors and more.

If your business expenses get out of control thanks to a new product launch, or traveling for trade shows, there is another solution that can help you get funds in the door fast -- factoring.  As you may know, many companies pay their invoices 30/60 or 90 days out. If you have outstanding invoices for a job that you have completed, and are owed apx. $20,000 or more, invoice factoring might just be the solution to get funds in fast to cover outstanding expenses. 

Here's how it works. IFG looks at the creditworthiness your customers and can fund within as little as 24 hours. Most factoring companies do not expect to buy 100 percent of a company’s receivables, and there are no minimum or maximum sales volume requirements. IFG’s professional rates are competitive; each client's circumstances will vary and may have an impact on the fees.

Because IFG offers clients a “use it as you need it” funding option, each invoice purchase is a separate transaction and does not form part of a portfolio lending approach. The transaction is modeled as a buy-sell transaction. IFG first undertakes a due diligence that typically takes one to two business days. Once completed the client is at liberty to offer invoices to IFG for purchase. Upon receipt of invoices, IFG checks the credit of the debtor named on the invoice and makes sure that the sale represented has been satisfactorily completed. Once this is done the debtor is advised of the purchase by IFG and the client receives their funding. At the end of the credit period the debtor pays IFG directly. The transaction is completed.

ACD Financial Services

www.acdfinancial.com