Archive for

All About Small Business Loans – How to Get Them

If the business employs less than a hundred, is owned and operated independently, and not the market leader in the industry where it belongs, then it is considered a small business. These are some of the criteria of the U.S. Small Business Administration (SBA) defining a small business.

One of the most common problems of a small business owner is the lack of funds to maintain, run and expand the business. If you have this problem, then these frequently asked questions will guide you in making your business survive through the support of a business loan.

What is a Small Business Loan?

A small business loan is the type of loan that lends money or funds to a small business owner so he or she can operate the business. It is also made available for individuals who wish to start a business.

Small business owners may use the amount borrowed for the establishment, construction or renovation of the business, acquisition of the necessary equipment, and for operational expenses such as payroll.

While a small business loan refers to a loan for the business itself, the personal credit history of the business owner will strongly determine if the bank or lender would give its approval to the application. Thus, a small business loan is also termed as a personal loan granted to small business owners.

How to apply for Small Business Loans?

When you apply for a loan, your loan provider will look into your personal credit history. You, the business owner, should also be able to project a sense of deep commitment to your small business. The lender will gauge your willingness to put a portion of your personal funds to help the business prosper. Be prepared also to present a loan security or collateral such as a house or car. What’s more, your educational background and expertise are also important factors for your business to be granted the loan.

The small business owner is also required to submit a business plan. A business plan is a written proposal which details the nature of your business, marketing strategy and contains a financial report. This document should also include how the business will generate income and support its operational expenses in the coming years. Moreover, the business plan should be able to convince your loan provider that you can pay the loan within the stated date of payment through the profit realize from the business and its expected continuous growth.

Remember that lenders need to make sure that the business can survive to pay up the loan and that its owner is credible enough to guarantee that the business is well planned to prosper.

Where to apply for Small Business Loans?

You can apply for a loan traditionally, which means going to local banks and government funded organizations. Even your local cooperatives have facilities for small business loans.

You may also apply for a loan online. Online application for a business loan is easier and convenient for a small business owner. You no longer have to waste time scouting for the best loan arrangement in the market. All you need to do is visit various websites and compare the rate and application requirements. However, make sure that your target small business loan provider is credible to avoid problems later on. A national bank with online capability is the best choice.

9 Tips For Writing Better Business Letters

It’s quite amazing how often business people fail to follow basic guidelines when it comes to writing their business correspondence. That might explain why so many people come to my writing help websites looking for help with their business letter writing. Just as businesses need to be focused and efficient to thrive and succeed, so too does the primary communications tool of most businesses – the business letter.

Following are a number of tips and guidelines that I have compiled while reading and writing many hundreds of business letters over the past 25+ years.

1. Limit Them To One Page

By definition, business letters should be short and to the point, preferably one page in length. Studies have found that busy business people do not like to read beyond the first page, and will actually delay reading longer letters. So, if you don’t want your letter to gather dust in an in-basket, keep it as short as possible.

2. Be Reader-Friendly

Always try to focus on the needs of the reader and make an effort to see things from their perspective. Put yourself in their position and imagine what it would be like for you to be receiving your letter. Anyone can do this, since we are all “customers” of some other business in some part of our lives.

3. Keep The Tone Formal And Factual

Generally speaking, the tone and content of business letters should be formal and factual. Feelings and emotions do not have a place in business letters. So, avoid phrases like “we feel” and use “we believe” or “we think” instead. A cordial, friendly approach is fine. Just keep it businesslike, but avoid overly formal terms like “heretofor”, “as per”, “herewith”, etc.

4. Carefully Plan Your Letter

Before writing the letter, take a few minutes to list all of the specific points you need to cover. Sometimes it may even mean a phone call to the recipient or his/her company to confirm a specific point. Remember, the purpose of the letter is to tie up all of the details on the subject at hand, so that more letters won’t have to be written back and forth.

5. Make It Clear, Concise And Logical

Use a clear and direct writing style that uses simple words and straightforward phrases. Make sure that your flow follows a logical progression, first identifying the main subject, elaborating on it, and then drawing the logical conclusion.

6. Accuracy And Timeliness Are Key

By their very nature, business letters need to be accurate and timely. They almost always have financial implications and related impacts on other businesses and/or people. Double-check all of the facts stated in the letter, and make sure that any future dates specified give others enough time to realistically complete what is expected of them.

7. Relegate Technical Details To Attachments

Often it is necessary to include detailed technical information as part of a business letter package. In such cases, use the main letter as a cover letter that lists and briefly explains and references the attached (or enclosed) documents.

8. Use Non-Discriminatory Language

Make sure that you avoid language that is specific to gender, race, or religion in all business letters, either to other businesses, or to customers. For example, use “workforce” instead of “manpower”, or “chairperson” rather than “chairman”. Most style guides contain detailed lists of the offensive terms and some suggested substitutes.

9. Eliminate Redundant Words And Phrases

There are certain words and phrases that one often sees in business correspondence that tend to make the language more complicated and cumbersome than necessary. For example, instead of the phrase “in spite of the fact that” use “although”; or instead of “in the normal course of events” use “normally”. There are many such redundant phrases, so review your letter and eliminate them.

If you are running any type of business in which business letters are important communication tools, you would do well to take careful heed of the above tips and advice. Remember, the business correspondence that you issue is a direct reflection of the overall products and/or services offered by your business. Poorly-written, amateurish, and/or shoddy business letters will surely result in lost sales.

To see some fully-formatted real-life business letter templates, check out the following link:

http://writinghelp-central.com/sample-letters-business.html

Copyright © Shaun R. Fawcett. All rights reserved.

Start Your Own Business – No Excuses!

Valid reasons to not start your own business do exist, however, many commonly used reasons have simple solutions. Not knowing what business to start, not having the money, not knowing the requirements for starting a business, not having a support system or the time are five of the top reasons preventing people from taking charge of their lives. Herein are some solutions to these problems.

Not Knowing What Business to Start

The surest way to success is to find something you are passionate about, then find a way to make money doing it. This should be your first step to starting your own business. First, find something you would enjoy doing for many hours a day, at least five days a week, even if you made no money. Second, look into your choice to find a specialty area. Don’t settle for “making furniture” when “making colonial style furniture for children’s playhouses” would be much easier to market because it very quickly determines your target market.

Don’t have a passion? Try picking up a few business magazines to see some trends and possibly find the spark to inspire you to start your own business.

Not Having Any or Enough Money

If you need to borrow money, do a lot of research. There are many options. It is not recommended to use credit cards to finance your business. Other options include small business or home equity loans through local or large chain banks, the small business association, Prosper.com, and venture capitalists. Borrowing from friends and family may be a viable option for you.

By far, the best way to purchase anything is to save the needed money and pay cash. This is true for business. Set up a monthly budget for your current income and allot as much money as you can afford into your business start-up fund. Focus your time on laying the foundation for your business. This includes writing a business plan, doing market research, reading books to hone or acquire business skills, learning about laws and regulations in your area, etc.

It may take a lot of time, but it will be worth it. If you start your business debt free, you will be miles ahead of the competition. You will be able to take bigger, calculated risks and see profits faster.

Not Knowing the Requirements

This problem is easily solved by asking questions. Start with your local Chamber of Commerce. Oftentimes, they will have a packet of information already made up for would be entrepreneurs. Talk with a tax advisor. Consider talking with an attorney about legal matters, copyrights, licensing, contracts and your business structure.

Not Having a Support System

Great support systems do not just happen, they are created. You can find a mentor through SCORE, a nonprofit organization dedicated to counseling small business owners. The Small Business Association also has a free program, the Small Business Development Center, that offers support to current and prospective small business owners. You can find both of these organizations on the internet.

Join an online forum for people with similar goals. Create a local support group, meet once a month to discuss your goals, challenges and generally encourage each other. Contact the Small Business Association. Search the web for other small business resources.

A great support system starts with you. If you don’t believe in yourself, it will be hard to convince others to believe in you, especially customers. Take the necessary steps to build your self-confidence. Any costs will be offset by the impact a positive attitude will have on your business.

Not Having the Time

You have no less time than anyone else. Everyone has 24 hours a day, 7 days a week. If something is important to you, you will find the time. We all prioritize our lives, either consciously or subconsciously. Become a conscious prioritizer. Eliminate time wasters, streamline necessary chores and delegate responsibilities where possible. If you want to run a successful business, these are tasks you need to master anyways. Start the habit now.

There will always be stumbling blocks on the path to success when you decide to start your own business. The key is to not stay down when you fall. Look at each one as a challenge to be creative. Creativity is, by necessity, the very core of running a successful business.