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8 Ways Your Small Business Can Establish and Maintain a Good Credit Score

With bad credit, your small business could suffer greatly. You can say goodbye to any future loans or government grants for small businesses you were counting on to expand or improve your business. Most businesses rely on investments and loans to thrive. If the profitability of your business is important to you, you’ll want to keep these ways to establish and maintain good credit in mind.

1. Incorporate and Identify Your Small Business

What happens in your personal life shouldn’t directly impact the profitability of your business. If you’ve mismanaged your personal credit, your business doesn’t need to suffer unnecessarily. Incorporating your business separates your business proprietors and creators (you).

Incorporation allows for the transferability of shares in your company and the ability to raise investment capital.

Once this is done, you can apply for a tax identification number. A tax identification number essentially acts as a social insurance identification number for your business. From here, you can open separate bank accounts, allowing your individual small business credit score to build.

2. Open a Small Business Bank Account

The vast majority of banks offer special incentives when it comes to small business banking. They understand your wants and needs and make it easier for you to open a small business account. Keeping your business and personal bank accounts separate will allow you to keep things strictly professional. Separating your two accounts will allow you to begin building a rapport under your business’ name.

3. Obtain a Business Credit Card

Credit cards make spending for your small business a breeze. Just ensure you pay your credit card monthly to develop a good credit score.

Double check to make sure the financial institution that you obtain your credit card from reports directly to the credit reporting agency.

4. Regular Payments Can’t Be Missed

Regular payments allow you to show your credit reliability and build upon it. Never miss a monthly payment and watch your credit score rise.

5. Count on Your Suppliers

A line of credit with your regular suppliers can make payments easy and help you build your business’ credit. You’ll be buying all the things you would normally, just with credit plan.

6. Taxes, Taxes, Taxes

April is every business’ most dreaded month—tax month. While it may be a pain, it’s important that you don’t ever forget to file your taxes. Non-compliance can have a negative effect on your business credit score.

7. Get Listed

Dun & Bradstreet is one of the most popular credit bureaus that will create a credit profile for your business. The majority of investors, credit card companies, and lending agencies require your business’ DUNS number before you can be approved.

8. Keep a Close Eye on Your Score

It is recommended that you check your business credit score every one to two months. This way, if any errors appear, you can solve the issue immediately. Also, if you notice something affecting your credit score, you can make the necessary adjustments in order to eliminate the issue.

If you want your small business to succeed, it’s essential you follow these tips to establish and maintain an excellent credit score.

5 Small Business Funding Options to Consider

Financing a small business is always a big challenge. Of course, you can get funding by applying for government grants for small businesses but there are other ways to finance your business. Here are some useful ways to find the money you need.

1. Consider Factoring

Factoring is one of the ways businesses secure funds. In this case, the company sells its receivables to get cash up-front for a small fee. This method is usually common among business owners with poor credit or businesses, such as apparel manufacturers, that have to fill orders long before they get paid. Though it’s a great way to secure funds, it can be expensive.

2. Self-Funding

Many entrepreneurs self-fund. Keep in mind that this takes a lot of commitment and dedication. You either have to use your personal savings or take on debt such as credit cards or a second mortgage. In some instances, small business owners sell their valuable assets to raise funds for the business.

3. Loved Ones

Most friends and family members want to see you succeed. And they will stop at nothing to help you. Such people can provide either equity or debt funding. No doubt, this is a great way to generate funds but be careful about bringing them into your business. Make sure you think it through before reaching an agreement. The sad thing is that more than 80% of new businesses fail in the first few years. The loss of capital can make your relationship go sour or result in an unpleasant family gathering. It is important to fill them in on the risk involved before they invest in the business.

4. Cash in Your Retirement Account

Are you unemployed and are looking to staring your own small business? If you don’t have the required funds to bring your idea to life, you can use the funds you’ve accumulated in your retirement account over the years. However, you have to follow the right procedures to tap into these programs before your retirement. Otherwise, you may be penalized. The procedures are quite simple but legally complex. Keep in mind that your retirement funds are at stake here. So if anything goes wrong, you will lose everything including your business and retirement funds. This is a risky business decision that you should only make after careful thought and consideration, as well as a discussion with your financial advisor.

5. Crowdfunding

Crowdfunding consists of web-based projects that allow small business owners to reach out to millions of potential investors worldwide through many different platforms. Investments can be debt, equity or reward-based. Keep in mind that there are different crowdfunding platforms available, so you will need to conduct thorough research to make an informed decision. All in all, crowdfunding can be a great way to secured funds for a relatively low-cost project.

There are more small business funding options to explore. However, with a comprehensive business plan and great commitment and dedication, you can generate the much-needed funds you need to finance your project.

4 Ways Your Small Business Can Improve Its Cash Flow

Managing a small business is not for the faint of heart. More than 80% of start-up businesses shut down within the first 5 years, many of them due to cash flow problems. And as such, many entrepreneurs are looking for new ways to fund and bring their ideas to life, which is why they apply for government grants for small businesses. Positive operating cash flow will sustain and help your business grow into the future. Here are great ways to increase your cash flow.

1. Optimize Your Price

One of the problems small business owners face is price evaluation. Pricing can impact your cash flow, either negatively or positively. Optimizing your price can boost sales and improve cash flow. Overpricing can result in fewer sales. Likewise, underpricing can affect your profit margin. All it takes to find a good balance is determining the right price. This can be done through market testing. Use different kinds of prices to determine where sales and prices are at their optimum.

However, this evaluation might require some adjustments and it can be time-consuming. But if you eventually find the right pricing, it will improve your cash flow. Remember that customers want to enjoy a great value for their price, so you need to step up your game to enhance the customer experience and increase the value if you’re going to increase your price.

2. Track Everything

Proper financial management requires that you keep track of what’s coming in and what’s going out in real time. Keeping track of all expenses and revenue will help you detect and fix costly mistakes before they get out of hand. If you’re not closely monitoring your finances, you may end up closing shop. A real-time view of cash flow can help you reduce your costs of operation and effectively manage spending.

3. Pull Your Financial Data Together

Knowledge is power, but only if you can use it the right way. As a small business owner, pulling your financial data together puts you in a better position to make smart investment decisions, cut operational costs and ensure the smooth running of day-to-day activities. However, if your data is scattered on different platforms and in locations, it increases the risk of misplaced information and errors. Plus, you may find it difficult to update information when and if necessary. By consolidating your data into one single platform, you’re more likely to make informed decisions.

4. Offer Deals for Continuity of Sales

The objective of every small business owner is to convert leads to repeat clients. Repeat buyers who come back over and over again for more of your products and services will help you sustain your cash flow. The importance of the continuity of sales cannot be overemphasized. It will provide a positive cash flow and help you predict your monthly income. This way, you can effectively allocate money to expenses and improve cash flow.

You can easily predict the behaviours of your longtime clients. If you have a regular client with whom you have worked for nearly three years and they pay you a specific amount on the 2nd of every month, then you know that the invoice will remain unchanged for all future months till the contract expires. This not only helps you make informed decisions but also adds stability to your cash flow.

To survive in this highly competitive market, small business owners must have a strong grasp of their cash flow.

5 Ways You Can Raise Capital for Your Small Business

Many entrepreneurs looking to start up a small business find it difficult to raise capital. Fortunately, there are several ways to raise capital including applying for government grants for small businesses. Other methods to get the capital to get your business started are listed below.

1. Raise Capital from Friends

One great way to raise capital for your small business is by contacting close pals. Close friends are always there to help in times of need. They want to see you at the top and would be willing to sacrifice anything for your success.

Odds are they might feel reluctant at first. It’s normal. You can convince them with a sound business plan and the benefits of investing, like paying them back with interest and within a stipulated time. You can go further by asking them to partner with you.

Regardless of how you intend going about it, just remember, you have to be open and honest with them. Otherwise, you will not get a dime.

2. Personal Savings

If you’re committed to bringing your dreams to life, then you should have no problem committing your personal money to it. If you’re employed, you certainly earn some form of income. Saving a part of your income, no matter how little, is a good start to raising capital for your small business. Indeed, it’s a sacrifice you have to make. Cut down on frivolous expenses and start saving.

It’s easier to get more money for your business this way. Friends, family members, banks, and investors might be willing to raise additional capital if you already have some of your money committed to your small business.

3. Angel Investors

Angel Investors are always a good point of contact because they are always looking for a viable business idea to invest in. Did you know that some of the world’s biggest tech companies such as Yahoo and Google raised capital through angel investors? There is nothing stopping you from approaching them. If they find your small business credible enough, angel investors will be ready to provide the required funds. Keep in mind that angel investors are wealthy individuals and successful entrepreneurs, so they will need to see a convincing business plan.

4. Apply for Government Grants for Small Business

Many governments and international agencies are interested in funding small businesses because of their vital role in growing the economy. Small businesses reduce the employment rate in the country by hiring people in the local community. As a result, government institutions set aside grants and loans to support small business owners. Applying for government grants is free. The more interesting and attractive your business, is the higher your chance of attracting more grants.

5. Private Investors

Another way to raise capital for your small business is by contacting private investors. This group of individuals is always willing and ready to fund a new and strong business in the hopes that they will profit from their investment.

Private investors have years of experience in the business world. Hence, they might only consider your request for funding if they see the business is highly profitable.

There are many ways to raise capital for a small business. All you have to do is look in the right direction and prepare a comprehensive business plan.

4 General Guidelines When Applying for a Business Grant

While starting a business is no doubt exciting, it is not without its challenges. These can include uncertainties regarding sales that can make overhead and inventory costs difficult as well attempting to remain competitive with larger companies. As a result, it is not uncommon that small business apply for grants provided by government agencies on a regular basis. These grants allow small businesses to stay afloat by allowing them to pay for things such as inventory items, office space and supplies, staff, and equipment.

Since these things are essential to the survival of most businesses, owners must guarantee that their application for a grant is competitive with others applying. Below are tips when applying for grants for small businesses and abiding by them will put you in the best position to obtain the funding you need.

1. Make sure you are eligible

A lot of timing and planning goes into a proposal to receive a small business grant. As a result, you want to confirm that your business is eligible for approval. Otherwise you will be setting yourself up for disappointment when your application ultimately gets rejected.

Before completing an application for any given government grant for small businesses, read the eligibility criteria. This will explicitly state which businesses will be considered for approval. Examples of eligibility can include being part of a particular industry, location, sales volume, race, and years in business. If the eligibility list excludes you on even one ground, do not bother applying and attempt to find grants where you meet all criteria as this will maximize your chances of being approved.

2. Be mindful of information

The information on your application will be the sole determinant of whether or not you will be approved for a small business grant. Therefore, everything needs to be perfect to be competitive with the other applications the agency will receives.

When completing your application, use professional language and grammar and refrain from using slang and information that has no substance. Provide accurate and honest information because if the grant officer determines that you have been untruthful you can bet you will be excluded from the process. Also ensure your application is completed in full as sections that are blank or parts that are missing information will give you the impression you are careless and not diligent enough.

3. Have a great plan

Your application may be fantastic with all required information, perfect grammar, and sentences that articulate your business and what it has to offer. However, government agencies that offer small business grants want to see that the money they give businesses will be put towards useful things that will benefit the public. Therefore, you need a great plan that will portray this.

The business plan that you include with your application should have a detailed outline about how your business will use the grant is approved. This will demonstrate to the agency that the grant will be helpful and used as intended. Many businesses use grants for new equipment, hiring additional staff, inventory, expansion, and office expenses. These are all smart investments but they definitely need to be articulated in your application.

4. Check in

Government agencies that give government grants for small businesses get inundated with applications. As a result, you definitely want to put yourself front and centre and avoid being forgotten about.

A few weeks after the application deadline, it is advisable to check in with your loan officer. Use this opportunity to reiterate how you could use the grant and offer to address any questions or concerns regarding your application. Follow up every few weeks. This will demonstrate your ongoing interest in the grant and allow the opportunity to supplement your submitted application.

5 Things Small Business Owners Should Do in 2018

The beginning of every year presents great opportunities for re-evaluation and planning for a small business. With thinning resources and orders that need to be fulfilled, most small businesses can benefit from a fresh injection of capital, new goals, and new processes. From applying for government grants for small businesses to making pricing changes, there are many things you should do in 2018 to keep your business competitive and solvent in 2018.

1. Keep Tabs on Your Finances

Having your accounts in order is perhaps one of the most important best practices that a small business can adhere to. Perform regular reconciliation of your accounts, preferably weekly, to ensure that you are in control of your finances on a continual basis. Always keeping your numbers before you will help you monitor your business finances in real time. You will also be able to flag down any issues that could be negatively affecting your operations and proactively make the necessary changes. Waiting to fix issues at the end of the year may be too late.

2. Get Organized Early On

A small business may not have complicated or detailed processes. However, don’t take this to mean you don’t need a system to help you organize your processes and activities. Before you know it, the few processes in your small business will snowball into a beehive of activities. Have a system in place that will help you organize, and maybe even automate, some of your repetitive or routine processes.

3. Apply for Grants

If you’re struggling to pay your bills or come up with the cash for that new marketing strategy you want to take public, consider applying for government grants for small businesses. This extra capital can help you drive business growth and take on new activities that can boost your revenue.

4. Establish Your 2018 Staffing Needs

One of the things you will have to decide on is whether to hire new staff or not. If you are on a shoestring budget, hiring new staff may be too strenuous on your business. However, you can get more or less the same results by contracting freelancers whenever you need an extra hand.

5. Determine the Right Pricing Strategy

While you may be tempted to outprice the competition by offering rock-bottom prices, this strategy may back-fire since most clients will be more interested in the quality of products or the services you offer. A lower price is always secondary to quality services and products. Rather than compete on price, focus on improving the quality of your services, and the price issue will sort itself out.

If you’re having trouble closing deals or you’re struggling to pay your overhead costs, now may be the time to take another look at your pricing strategy.

The year 2018 is turning out to be a great year for small businesses with an eye on providing quality services and products at the most competitive prices. Increasingly, businesses are being proactive and also thinking outside the box to keep their expenses under control and widen their profit margins.

4 Important Tips to Promote Small Business Success

Running a business can be a difficult task. It will be very rewarding once you have found a certain amount of success but getting yourself to that point won’t be easy. There are certain things that you can do to promote success in your business endeavours. Being able to understand how to use government grants for small businesses and generally making use of good advice should help your business to improve over time.

1. Understand What Government Grants Are Available

You should make sure that you know whether you’re eligible for different government grants. Sometimes your company can greatly benefit from receiving these funds and will be allowed to grow substantially from having access to them. Look into the specific grants that are available in your area. If your type of business qualifies for any of these grants, then it would behove you to apply for them immediately.

Making good decisions is an important part of being an effective business owner. You need to make use of all of the resources available to you in order for your company to grow. Don’t neglect any opportunities that are presented to your business. If government grants can help your company to operate more smoothly and gain an advantage, then you need to capitalise on this.

2. Pay Close Attention to the Competition

When you want to succeed in business, it’s imperative that you keep a close eye on your competition. If your competition is doing something new, then you need to be aware of it in case this starts to attract customers away from your store. One of the most sensible reasons that people pay close attention to their competition is to gauge their pricing data. You need to be able to stay competitive when pricing your own services or goods.

3. Don’t Let Taxes Catch You by Surprise

It’s essential that you have a professional accountant to handle your tax data. If you don’t have a skilled professional to help you handle the particulars of your taxes, it is possible that you can have errors. Aside from this, some small business owners get caught by surprise when they find out how much they owe on their taxes. This is a rookie mistake and should be avoided by being prepared for whatever costs you’re going to face.

Unless you’re very confident in your personal accounting skills, you should look into hiring a tax service or accounting firm to help with this situation. You’ll wind up being in a much better position and won’t need to fret when taxes become due. When you have all of the right information and expert advice that you can rely on, it’s a simple task to maintain the funds needed to pay taxes.

4. Maintain a Strict Schedule

You need to run your business effectively. In order to have the best results, it’s a good idea to maintain a strict schedule to complete as many tasks as you can. When your employees see you working hard, it will help to inspire them to do the same. The leader of a business needs to be the hardest-working person involved in the company, especially during the first

few years. This will give you a much better chance at being successful as you will reap what you sow in the business world.

5 Tips to Help Your Small Business Grow

Being a small business owner can be simultaneously very satisfying and incredibly stressful. You’re responsible for the well-being of your company and the livelihoods of the people you employ. It can be a lot of pressure sometimes but you should also feel a sense of pride that you’re doing the best job you can. Whether you received government grants for small businesses when starting out or not, you worked hard to build this operation from the ground up.

The successes that you’ve had up until now are due to your hard work and the passion of the other workers you’ve surrounded yourself with. In order to continue to grow your business, it’s important that you always look into new ideas. Take a look at the following five tips to help your business grow. They should allow you to look towards the future and have even greater aspirations.

1. Try to Be Innovative

In order to have success in the business realm, you need to do your best to be innovative. If your business doesn’t stand out from the pack in some ways, then you’re liable to get lost in the mix. Do your best to offer new and exciting products. If your business is more focused on providing a service, then you need to innovate in that way by providing services the competition can’t.

2. Customer Service Is Key

It should go without saying that your relationship with your customers is the most important aspect of your business. Always ensure that they’re happy with their experiences when dealing with your business. When you’re training new employees, you must impress upon them that good customer service can make or break a business. When your customers are happy to see the workers and have good interactions with them, they’re far more likely to become loyal patrons.

3. Make Use of Social Media

In this day and age, you must have a social media presence. Businesses that aren’t making use of social media networks to increase their visibility are behind the times. You should create profiles for your business on all of the major sites and then do your best to engage with your target audience.

Be sincere with your social media outreach and also don’t be afraid to do something unique or funny. Standing out can be a very good thing in the business world. If you can get potential customers to remember your name, they’re going to be more likely to want to try your services.

4. Competitive Pricing

You can’t afford to price products or services too low. Even though there is a threshold that you can’t go below, you should do your best to offer competitive pricing options. Always research what your competition is doing. Keep an eye on their price points and do your best to always match or best them.

When your prices are very reasonable, it will give you a better reputation with your customers. Positive word of mouth will spread that you give great deals and you’ll see more business because of it. Of course, you also need to ensure to always provide top-notch service to go with those amazing prices.

5. Make Use of Customer Surveys

It might seem to be an unusual choice but customer surveys can be very useful for your business. Getting information directly from your customers about what they want to see more of at your business can be quite valuable. You’ll be able to do your own market research in this fashion and can also get feedback on how well your customer service is going.

Use everything at your disposal to make sure that your clientele has the best experience possible. When you do all of these things, your business will be sure to grow. It may take time to grow exponentially but making steady improvements year over year will ensure that you stay a successful operation for a long time to come.

Four Tips to Fund Small Business Growth

Growing your small business requires exceptional planning and plenty of time, energy and sweat. However, it also usually requires a significant amount of funding. In many cases, a business does not have enough funds available to pay for all new product developments or expansion plans. Between government grants for small businesses and other options, you may be able to find the extra funding that you need to accomplish your business growth plans and to seize the opportunities that are available to you right now..

1. Use a Grant

Government grants for small businesses are essentially free money, so this makes them one of the best financial resources to use. Before you borrow money or give away a portion of your company to a partner or an investor, explore all of the grant options available. The Internet is a great resource to use to locate grants that may be available to your business.

2. Think About Crowdfunding

Crowdfunding is a relatively new concept, and it allows you to fund a loan from dozens or even hundreds of individuals rather than from a single bank. There are many crowdfunding platforms available for you to use. You simply create a profile for your loan request, and you wait for people to show interest through partially funding your loan. This is a great idea if you have bad credit or if you do not want to go through the typical bank loan process.

3. Apply for a Small Business Loan

Applying for a small business loan is one of the most traditional ways to raise money. It continues to be a popular option because it is effective. You will need to have a formal business plan prepared, and you will need to provide the bank with all of your personal and business financials. The loan process can be lengthy, but this may be a great way to get the money that you need.

4. Find an Investor or Partner

Another idea is to locate a partner or investors. This could be a silent partner who simply gives you money in exchange for a share of the profits going forward. It could also be an active partner who brings networking connections, work experience or something else to the table as well as money that you need for growth.

Business growth rarely comes without its aches and pains. One of the most common causes of growth pains relates to finances. If you plan ahead and seek financing before you begin your growth and expansion plans, you may be able to reduce stress and even mitigate risk in some cases. Examine each of these financing options carefully. Remember that you could use money from multiple sources as needed rather than only from one source.

Four Benefits of Starting a Small Business

If you have an entrepreneurial spirit and an amazing idea, you can start a small business and be successful with it. Government grants for small businesses are available, and they can provide you with the funds that you need to get your operation off the ground. The following are four ways you can benefit from starting one:

1. Tax Breaks

One great thing about having a small business in Canada is that you get to take advantage of quite a few benefits. One of those benefits is the home business lot of deductions that you can take. That’s right. You can receive some deductions for using your home as your business if you spend money for office supplies and utilities that go toward the business operations. You may even have the opportunity to take auto deductions if you have a business that delivers products to customers.

2. Loans and Advances

When you own a business, a whole new world of credit opportunities opens up to you. You may be able to qualify for merchant advances as well as a loan that will help you to get better equipment for your business. If you can show that your operation is successful, financial businesses will be willing to invest in you. You could apply for remodeling grants and things like that, as well. Just watch what’s available for you once you open the doors to your establishment.

3. Customizable Schedule

Another wonderful thing about owning a small business is that you can make your own schedule. That means that you can work with any other obligations that you have like schooling or taking care of your family. You’re your own boss, so you can show up for work or not show up whenever you please. The customizable schedule is still and will always be one of the greatest joys of owning a small business.

4. Control and Personal Joy

Owning your own business will make you feel accomplished. You’ll also have that sense of control in that you can choose who to serve and not serve. You can choose what is ethical and moral for your business and what isn’t. You can choose the type of business partners with whom you want to be involved. It’s a wonderful feeling to look at the business that you have built and truly take in its growth. It’s a whole separate joy to know that you can pass that business down to your children.

If you have a mind for business and are good with customer service, you may want to think about starting a small business. You could even choose one that has little or no overhead to get yourself started.