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wellness, freelance, business cash flow

Beyond COVID-19: Be proactive about your business cash flow

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Being proactive with your business cash flow is essential as we are waiting to see what the developments of this chaotic situation are going to be.  I have been contacting our banking institutions’ sponsors and alternative sources of funding for small businesses

wellness, freelance, business cash flow

Don’t delay and be proactive with your business cash flow
  1. Don’t delay to be proactive about your cash flow and your business. Your situation will turn sour pretty soon and your family will suffer.
  2. Talk to your financial institutions and see if they have any help for your business cash flow based on past performance. Some banks are only tending to their own clients and others are taking new clients as well. Shop around if your bank says no.
  3. Apply to all sources you can including SBA Loans but remember those will take time. It’s better to have business cash flow that you don’t touch or need than waiting for a miracle to happen.
  4. Do not, I repeat, do not touch your savings unless absolutely necessary. Your savings is the only guarantee you can show to your bank that you were a solid business and that you are just affected by this situation. We don’t know how long this will take and your savings should be your last resort.
  5. If you cannot go the traditional route, apply to alternative sources now and if you get a grant or federal loan later you can always pay your first loan off in advance with no penalty. However, be aware of scams and shark loans! Only work with alternative funding that you know or have been recommended.
  6. If your credit is not so good, our partners at National Biz are fantastic at approving quickly and with less conditions than banks.

Finally, be proactive with your business cash flow and think of ways your business can still exist in the next three months. For instance, if you are a retail or personal service business, contact your clients and ask them if they would buy a gift certificate with no due date.

Go for small amounts: $5, $10, $15 can make a pool of clients that might or might not use the gift certificate in the future. Ask for their support by doubling the amount of the gift certificate at the time of service. (if it’s $5, you will give them $10 value).

You might be interested: Beyond COVID-19: Prepare your entrepreneur skills for the survival of the fittest

Organize other contests, prizes, online auctions and anything that can get their attention at this time. Remember everybody is stuck at home and going berserk on social media!

To talk to Valley Bank, please contact Fatima Pearn FPearn@valley.com

To talk to Investors Bank, please contact Carlos Yepez cyepez@investorsbank.com

To talk to PNC Bank, please contact Samreen Malik, samreen.malik@pnc.com

To talk to National Business Capital and Services, please go to their site National Business Capital and Services.

credit cards credit history

Growing your business might mean growing your debt

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Falling credit cards - debt conceptby Hispanic Chamber of E-Commerce Team

Over time, your business will—hopefully—grow, seizing new opportunities to expand and to flourish. As these opportunities present themselves, you may face the question of how you’ll pay for them on the front-end—how you’ll afford a new building, for instance, with larger office space, or how you’ll get additional inventory.

In these cases, you may find that you need to borrow money—which of course requires you to have some decent business credit. Building credit is as important for corporations as it is for individuals—and it can be just as difficult.

There are a few tips you can keep in mind to make the process a bit smoother, though—including the following:

  1. Start by acknowledging that it’s not entirely about the business credit; your personal credit is also going to be scrutinized, as likely as not. Because most new businesses don’t really have a credit history to speak of, lenders will look at the personal credit of the business owner. Your personal financial habits, then, could very directly impact your business’ long-term financial options.
  2. At the same time, it is important to maintain a separation between the company’s finances and your own personal finances. You shouldn’t be putting business expenses on your personal credit card, and you definitely shouldn’t be putting personal expenses on the business card. Either scenario could come back to haunt you.
  3. Apply for credit early—before you really need it, even. If you have no credit history to speak of then it could take months, even years for you to get approved. If you open up a business credit card or take out a very small loan early on, it gives lenders something to appraise—and could reduce your wait time when you need to take out a much larger loan.
  4. Keep an eye on your credit cards and loan payments—and pay them on time. This is obvious yet it cannot be emphasized enough: The better relationship you can maintain with your lender, the more likely you’ll be to get a more sizable loan down the road.

Building business credit takes time, and it takes a sense of direction—so start now. Remember, as you do, why you’re doing it, and how it might ultimately serve your business down the road.