How to Strategically Use Every Day Business Operations to Promote Fundability

The way you run your business, the day-to-day operations, affects everything. From your reputation with customers to even your ability to get funding, all of it can be affected by business operations. This is why you have to be strategic.

Strategic Business Operations Can Promote Fundability

Most business owners do not realize this. They know that how they run their business affects success. However, most don’t get that the details of day-to-day business operations can affect fundability. Things like:

Licensing
Business bank accounts
Merchant accounts (or lack thereof)
Business website
Even tools used to manage money

All of these can affect the ability of your business to get funding. It’s not just whether your business is fundable or not. Certain aspects of how you run your business can actually promote the ability of your business to get funding, or fundability.

Business Licenses

You may be thinking, ok, what’s the strategy here? Of course you need to have your business licenses. You may be surprised to know how many business owners never think to check licensing requirements. That is, until it is an issue.

Contact state, county, and city government offices to see if there are any required licenses and permits to operate your type of business. Licensing requirements differ based on state, town, and industry. Always make sure you have the proper licensing for your corporation. You don’t want the first time you consider licensing to be when a lender brings it up.

Business Bank Account

Some business owners start out trying to use one account for business and personal funds. But the best strategy is to have a bank account devoted strictly to your business from the beginning. If it’s too late to do it from the start, start now.

First, the IRS wants to see business funds and personal funds separated. Having a separate, devoted business bank account makes that much easier. Also, your business banking history is important when it comes to fundability. Another reason this is important is one that few realize. The date you open your business bank account is the day that lenders consider your business to have started.

Say you opened your business 10 years ago. Then, 6 months ago you opened a business bank account. If you try to get a loan today, the lender might consider you to have been in business for 6 months. The longer your business banking history, the better your borrowing potential is. Don’t wait to open a bank account just for your business.

Here’s yet another way having a business bank account is a smart business operations strategy. Without one, you cannot get a business merchant account. Without that, you can’t accept credit card payments. Studies show people spend more when they can use a credit card. Even if you do not have a need for that now, you may one day. If you already have a business bank account, you’ll be ready.

Web Domain and Professional Website

Yes, there is even a strategy for your business website and domain. First, you need a business website. Customers and lenders will be looking for one. Then, pay for it to be professionally designed. It has to be user friendly, and you do not want it to look thrown together. If customers or lenders see an unprofessional business website, it will not help you.

Next, pay for web hosting. A company like GoDaddy or HostGator is best. Try to avoid using free Weebly or Wix options. You want it to be your domain, not domain.wix.com. Your domain should be your business name, if possible.

Lastly, you need a company email address for your business that is on the same domain as your website. Use a professional email address such as yourname@yoursite.com. A website domain provider such as GoDaddy will often provide this for you.

Do not use Yahoo, AOL, Gmail, Hotmail or similar free email services.

Business Money Management

Managing small business finances can be overwhelming. There are a number of tools that can help streamline the process. Options like Brex, Divvy, Expensify, Lola, and more are growing in popularity. Not only can they help you manage funds, but some of them can help you build business credit if needed.

If you are a new business, it will be incredibly useful to choose a business money management tool that will also help you build business credit. There are not a lot that will do this, but there are a couple.

Brex

Brex is a business money management system. It works with your accounting software and allows you to track expenses. Depending on the level of service you choose, it can also help with paying bills and controlling spending.

They offer a couple of options. The easiest way to use Brex for both managing finances and building business credit is to open a Brex Cash account. Note, this is not a bank, but rather a banking alternative. However, they do have a partnership with the FDIC and your funds are secure.

Everyone that opens a Brex cash account gets a corporate card. It works just like a debit card, drawing from your Brex Cash balance daily. However, unlike a debit card, Brex reports these payments to Dun & Bradstreet, thus helping build your business credit score. That, in turn, helps to increase the fundability of your business.

Since this card is secured by the balance in your Brex cash account, and limited to that balance, you do not have to worry about underwriting. They have other money management options as well for those who qualify.

Divvy

Another business money management option that helps you build business credit is Divvy. It was formerly Bill.com. This company is very similar to Brex . In fact, in a direct comparison there are just a few differences.

First, Brex charges $5 per card for additional cards to team members, unless you pay for the premium account. Then you get unlimited cards. Divvy offers unlimited free cards.

There are also differences in budgeting, reimbursement options, and software integrations. For example, Divvy integrates with Quickbooks Online and NetSuite currently. Meanwhile, Brex’s integrations with Quickbooks Desktop and Xero are said to be coming soon.

Divvy also has an offline mode, and they do not currently offer the ability to trade in points for cryptocurrency. One other major difference is that Divvy reports to the Small Business Finance Exchange.

This is a data collection agency, not a credit reporting agency. Yet, they do provide data to their partners. These partners include some business credit reporting agencies. By reporting payments to the SBFE, Divvy indirectly provides information to all SBFE partners. This can definitely help build business credit more quickly.

You Can Strategically Use Business Operations to Promote Fundability

If you are careful in how you operate your business on a day to day basis, you can promote fundability. By handling certain business operations in an intentional and strategic way, you can increase your ability to get the business funding you need, when you need it.

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Straight Talk: Is Divvy Really a Tool You Want In Your Business Toolbox?

We all have tools. I’m not just talking about hammers and nails. We have kitchen tools, lawn care tools, tools we use in the office, even tools we use to care for our pets and our children. Business owners have tools they use for many things, including managing finances. Is Divvy a tool that business owners need in their toolbox? Let’s find out.

Find Out If Divvy Is Right For Your Business

There are a number of money management tools on the market. We’re digging in with Divvy to find the good, the bad, and the ugly so you can make an informed decision for your business.

What Divvy Is, and What It Isn’t

What is Divvy? At its core, it is an expense management system. In fact, it was recently acquired by Bill.com, due to the fact that Bill.com had an increasing number of customers looking for help with money management.

Check out how our reliable process will help your business get the best business credit cards.

It is designed to help businesses manage their business finances by integrating with accounting systems and helping them control spending in a streamlined manner. That is what Divvy is.

It is not meant to be a business funding option on its own. It does offer a charge card option that allows for business funding, and even helps build business credit. However, it’s purpose is to be another spending management tool. If it were a hammer, this card would be the backside that pulls the nails out. You buy a hammer to hammer nails. The other side is useful, but generally you don’t use a hammer simply to pull nails. It works for that, but that is not it’s main purpose.

Money Management Tool

They offer a lot of great money management products for managing spending, expenses, and accounts payable. The system allows you to see transactions in real time, and send funds in seconds via mobile or desktop.

You can also issue cards to employees, either virtual or physical cards, and give them direct access to funds with a spending limit you set. This not only cuts down on expense reports, but also helps with budget management. That is the main purpose of the card.

The system currently integrates with Quickbooks Online and Oracle Netsuite. Integration with Xero and Quickbooks Desktop is coming soon.

On the accounts payable side, you can seamlessly receive invoices, get approvals, and send payment by either ACH, check, or virtual card. It’s truly an easy and innovative way to streamline processes and manage spend. However, there is currently a waitlist for accounts payable services.

Building Business Credit

So, what’s the deal with Divvy and business credit? They do offer a business card. They have more than one way of underwriting so that if you do not qualify with traditional underwriting, they can look at other factors for approval. There is really no elaboration on what these may be. But, often it is monthly income, time in business, and the like.

So, if you do not qualify for other cards, you may qualify for this one. The main point of the card however, is that it is attached to the Divvy system. That means, if you distribute cards or virtual cards to employees, you can see their spending in real time. It offers business owners more control.

Check out how our reliable process will help your business get the best business credit cards.

They report positive payment history to the S mall Business Finance Exchange. That means this card does help you build your business credit score, because the SBFE reports information to Dun & Bradstreet. Since only 7% of companies that offer credit to businesses actually report positive history, this is big. One of the largest obstacles to building business credit is finding accounts that will report positive history. Most only report missed payments.

The thing about business credit building is, one account reporting is just not enough. Your business has to be set up properly to be fundable to begin with. Also, you need a lot more accounts that will report before you have a business credit score at all. That in itself is a challenge. This is where a program like the Credit Suite Business Credit Builder can be helpful, because it walks you through the process of setting up to be fundable, finding accounts that will report, and applying for them at the right time so that you actually qualify.

Divvy’s Online Reputation

If you look at online reviews, you are going to get a mixed bag. Most of the negative reviews and complaints come from those looking for a business credit card. They are not looking for money management services. Those looking for money management services seem to be pleased.

It does appear that maybe they are not clear on a lot of things, or at least they do not make the information easy to find, pertaining to how the card works and rewards. For example, one complaint was that this is a charge card, not a credit card. That means the balance must be paid in full each month. This would explain why there is no interest rate information, as there is no interest since the card carries no balance.

After a lot of digging around I did confirm that the Divvy card is a charge card used to pull against a line of credit. It is not a credit card, and therefore you cannot carry a balance. This information was definitely not easy to find on the website, and they refer to the card as a credit card multiple times.

Check out how our reliable process will help your business get the best business credit cards.

Another complaint noted that card rewards are not earned unless you use at least 30% of the credit line. I could not verify this. There is no mention of it that I could find. That doesn’t mean it isn’t there, but it certainly is not out front information.

There were many positive reviews from those who were using the service mainly for money management.

They have a D+ rating at BBB.org. However, the fact that the business is only 3 years old and there are only a handful of reviews and complaints, skews this grade. People are much more likely to report negative experiences to the Better Business Bureau. Any negative report is going to bring the grade down very quickly.

It’s important to note also that the company did respond to the complaints and worked to make them right if they were in the wrong.

What’s the Final Word on Divvy?

This is a new company, and it appears to be making its way well among the new-ish niche of money management options. They offer what appears to be smooth integration with common accounting systems. Their charge card allows for spend control and options for managing cash flow. It is an added bonus that they report on-time payments to your business credit profile.

In conclusion, this is a great tool for money management. One major reason for this is that they can help you build credit for your business. If you are looking for a money management option for your business tool box, it’s a solid choice. Apply for Divvy now. If you are mainly looking for a business credit card, you may be better off with something else.

The Credit Suite Business Credit Builder can help you position your business to qualify for all the funding you will ever need, and help you find the best vendors for your business at the same time. Sign up for a free business credit consultation today.

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Straight Talk: Is Divvy Really a Tool You Want In Your Business Toolbox?

Find Out If Divvy Is Right For Your Business

There are a number of money management tools on the market. We’re digging in with Divvy to find the good, the bad, and the ugly so you can make an informed decision for your business.

What Divvy Is, and What It Isn’t

Check out how our reliable process will help your business get the best business credit cards.

It is designed to help businesses manage their business finances by integrating with accounting systems and helping them control spending in a streamlined manner. That is what Divvy is.

Money Management Tool

The system currently integrates with Quickbooks Online and Oracle Netsuite. Integration with Xero and Quickbooks Desktop is coming soon.

Building Business Credit

Check out how our reliable process will help your business get the best business credit cards.

Divvy’s Online Reputation

Check out how our reliable process will help your business get the best business credit cards.

There were many positive reviews from those who were using the service mainly for money management.

It’s important to note also that the company did respond to the complaints and worked to make them right if they were in the wrong.

What’s the Final Word on Divvy?

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How Can I Get a $10,000 Loan for My Business With 1 to 3 Years Operating

In terms of business funding, the longer you have been in business, the better. There are some nuances to this you may not expect however. How can you get a $10,000 loan for your business when you have only been operating for 1 to 3 years?

How Long Have You Really Been in Business?

You may not have been in business as long as you think. At least, not in the eyes of credit issuers.

For example, if you have been doing business as a sole proprietor, and then decide to incorporate, some credit issuers will consider the date the business began to be the date of incorporation. Another thing that can affect time in business in the eyes of a lender is the date you open your business bank account.

Many lenders require a separate, dedicated bank account for your business, and they consider the date the business began to be the date the bank account was opened.

How Does Time In Business Affect Funding?

Generally speaking, the longer you have been in business, the more funding you can get. And you can also get better terms and interest rates when you have been in business longer.

There are not as many funding options when you have only been in business a year or fewer as there are when you have been in business 2 years, 3 years, or more. The longer you are in business, the more financing choices you will have.

$10,000 Loan Options for Companies with 1 Year in Business

When you were in business for less than one year, your funding options were pretty limited. There are ways to get money, but few of them are actually loans. These include:

The Credit Line Hybrid
Retirement and Investment Financing
Angel Investors
Venture Capital
Crowdfunding
And grants

You have more choices for $10,000 loan options once you get beyond a year in business. Still, the Credit Line Hybrid in particular is a good choice regardless.

Credit Line Hybrid

A credit line hybrid is a form of unsecured funding. With it, you can get interest rates as low as 0%. It’s a credit card stacking program, and many of the cards report to business CRAs. This means, you can build business credit while funding your business.

You need a good credit score or a guarantor with good credit to get an approval. For the Credit Suite Credit Line Hybrid, this is a FICO score of at least 680. No financials required, and a $10,000 loan which this program is more than doable. That is because often you can get a loan of up to $150,000.

Be aware, some cards may report on your personal credit. That means it can affect your personal credit score as well, so be sure you make your payments.

$10,000 Loan Options with 2 Years In Business

With another year in business, you can access the above funding types, plus you have the possibility of a few more. Here are some examples:

Business Revenue Lending

Although you can technically qualify with only one year in business, the annual revenue requirement is high enough that applying later may make more sense. With a similar basis for getting funding, business revenue lending can be considered a reasonable alternative.

This is a way to raise capital from investors who get a percentage of the enterprise’s ongoing gross revenues in exchange for money invested. In a revenue-based financing investment, investors get a regular share of business income until a predetermined amount is paid.

Often this predetermined amount is a multiple of the principal investment. It can be between 3 – 5 times the original amount invested. Since repayment of the loan is based on revenues, the time it takes to repay the loan will fluctuate. The faster revenue grows, the quicker you’ll repay the loan, and vice versa.

The percentage of monthly revenues committed to repayment can be as high as 10%. Furthermore, monthly payments will fluctuate with revenue highs and lows and will continue until you’ve paid back the loan in full.

The terms for the Credit Suite business revenue lending program are:

You must be able to prove consistent revenue verifiable through bank statements
Loan Amounts from $5,000-$500,000
3-36 month terms
10-1.45%
500 credit score or higher, with no recent bankruptcies
Annual business revenue of $120,000 or more per year
Or business must bring in at least $15,000 monthly revenue with 6 months’ time in business
In business for a year or more
The business must do more than 5 small transactions each month
Financial services industries are prohibited

Cash Flow Financing with Fundbox

Fundbox makes cash flow financing easy. All they need is information relating to business cash flow when deciding whether to approve. You can get a revolving line of credit for up to $100,000. Fundbox will auto debit your weekly payment from your bank account.

Even better, you don’t need to show a minimum personal credit score or minimum time in business. You pay in equal installments over the course of a 12 or 24 week plan, and available credit replenishes as you pay. There is no penalty to repay early.

The business must be U.S. based and you need a 600+ personal FICO score. Other requirements include:

$100,000+ in annual revenue
A dedicated, separate business checking account
Ideally 6 months in business or more

Equipment Financing

Equipment financing is when you use a loan or lease to purchase or borrow hard assets for your business. It is a business financing option you can use to buy any physical asset. Physical assets can include items such as a restaurant oven or a company car.

When you get equipment financing through Credit Suite, you need at least one year in business. You can get approved even with challenged credit, and no financials are required.

$10,000 Loan Options After 3 Years on Business

After your company has been in business for at least 3 years, many more funding options become available. That is, in addition to those already listed. These include many of the more common options you have probably heard of.

SBA Loans

It’ll be easier to get an SBA loan the longer you’re in business. This is because you can more readily show your business is established, and making money. Demonstrating profitability and responsible credit and bank account management will improve your chances of getting an approval for an SBA loan.

SBA loans have great terms, so it is worth it to do what it takes to become eligible.

Term Loans

Banks are often the first place we think of when we think of financing. Yet, big banks only sign off on about 25% of the small business loan applications that come their way. Term loans often have lower interest rates than many other funding options. They also tend to be for higher loan amounts.

Generally speaking, the companies banks end up funding have:

Very strong financials
Near-perfect credit scores
Collateral

There Is More to Fundability Than Time In Business

It’s important to remember that credit issuers look at much more than just time in business. Obviously things like whether or not you pay your bills or even make a profit come under consideration. However, even if you are currently paying bills and making a profit, you may not get approval if you do not have the time in business.

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How Your Business Office Impacts Fundability

Some fundability elements are impossible to control. For example, time in business. You can only change that by staying in business. However, others can be controlled by you as the owner. One of the things you can control is how you set up your business office.

Factors Affecting Fundability

Truly, it can be overwhelming when you start to realize just how much affects the fundability of your business. In fact, there are 125 factors that affect fundability. They can be broken down into 4 main principles.

Foundation
Business Credit Reports
Financial Statements
Application Process

Still, most business owners realize that their business credit reports and financing statements affect their ability to get funding. Yet, few realize the actual process of applying for funding can make a difference. While many may realize that some parts of the way their business is set up can affect fundability, most business owners do not realize the depth of detail involved.

Foundation of Fundability

Your business has to be set up in a very specific way to build fundability. Each step is vital, and if you miss one, it could do more harm than you may think. For example, you need an EIN and you need to incorporate. This may or may not surprise you, but it probably makes sense.

What does not make sense to a lot of business owners, is the idea that much of what has to do with their actual business office can affect fundability. Details such as business name, business address, phone number, even website and email address can make or break your ability to get funding for your business.

Your Business Office and Fundability

When it comes to your business office and fundability, here’s what you need to consider.

The name of your business and whether it is consistent everywhere it is used
Your business address
Your business phone number
Business website and email address

Business Name: Risk

Yes, the name of your business affects your ability to get funding. First, it should not indicate that your business is one that is risky. If you are opening a business that is considered to be high risk by the lender, for example a travel agency, do not name it “Carla’s Travel Agency.” You can name it Carla’s, or anything else that does not make it obvious that this is a high risk business.

Honestly, it’s just a way to ensure that you make it as far into the process as possible without being denied for funding. Depending on the lender, they could deny immediately if they can see at a glance that the business is in a high-risk industry.

Business Name-Consistency

Your business name has to be consistent. If you list it one way on your application and it is different anywhere else, whether on your business card, your phone listing, your website, or the Secretary of State’s office, enders will likely deny.

In fact, even seemingly small details like using an ampersand in one place and the word “and” in another can cause denial. Inconsistency throws up a red flag for fraud. Unfortunately, a lot of lenders will not investigate. Instead, they will just deny.

Business Address

The actual physical location of your office doesn’t matter as much as the address. Lenders want to see a physical address where you can receive mail. That means no P.O. Box or UPS Box. If you are homebased and do not want to use your home address, a virtual office can work.

Here are three virtual office providers we love:

If you go this route, keep in mind some lenders and credit providers will not accept virtual offices.

What if Your Area Doesn’t Have Virtual Office Providers?

Get creative! Consider talking with local business owners to find out what they do. There may be options for shared spaces. It might help to talk to local computer user groups too, or consider going out of state if you are close to the border. They may open more options, but pay attention to tax laws.

For example, neither Tennessee or Texas have state income taxes, but Arkansas does. Some border cities in Arkansas have exemptions, but others do not.

Not wanting to use your home address is understandable. Still, realize your address isn’t hard for anyone to get regardless. As a result, a virtual address isn’t a lot of protection. They can be a good option, but using one could limit your funding options somewhat.

Business Phone Number

You need a dedicated, separate number for the business only. It should be toll-free and listed in the 411 directory. Voice Over Internet Protocol (VoIP) is fine, and you can forward your business number to your personal phone if you want.

Business Website and Email Address

Stay away from free web hosting and email services. Your business website is your first impression on many, including lenders. As such, it should look good and work well. Of course, It should be user friendly also. It’s wise to hire a professional web designer.

Your business email address should have the same URL as your website. Often, email can be included in your hosting package. Do not use an account from Gmail, Yahoo, or any other free email service.

How Your Business Office is Set Up Impacts Fundability

How you set up your business office affects fundability. The good news is, this is a factor you can control. If you are already up and running, make any needed changes now. The sooner the better when it comes to building fundability.

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Easy Business Loan Approval: 5 Tips to Make it a Reality

You may think applying for a business loan is simply a matter of filling out the application. In truth, it’s more involved than that. In fact, there are many factors in the process that can affect your chances of approval. Some of these factors you cannot control, some you can. Knowing how to handle what you can control will help lead to easy business loan approval.

Easy Business Loan Approval: Questions to Ask Yourself Before You Apply

Before you apply, you need to ask yourself the following questions:

What kind of loan do you need?
How do you plan to use the funds?
What type of lender will you use?
Do you even qualify for a business loan?
Are there other funding options that will work better right now?
Can you afford a business loan?

Now, don’t just ask and answer these questions passively in your head. In contrast, be intentional. The answers will help you apply for the right loan for your business. Truly, this is a huge part of increasing the chances of easy business loan approval.

5 Tips for Easy Business Loan Approval

Once you know the answers to these questions, use these tips to ensure you have the best approval chances possible.

Tip #1: Make Sure Your Business is Set Up to Be Fundable

Really, everything from your business name and contact information to your business website plays a role. Surprisingly, even small details that seem inconsequential can cause a loan application to be delayed or denied altogether.

For example, your business needs its own phone number, and toll free is best. Then, list it in the 411 directory. Also, make sure your business address is a physical address where you can receive mail. Don’t use a P.O. Box or UPS box. Virtual addresses are okay, but some lenders will not accept them. If you run your business from home, you can use your home address.

You also need an EIN, and your business needs to be incorporated. A dedicated business bank account is a must as well. Furthermore, make sure you have all the necessary licenses to operate legally at all levels-federal, state, and local.

If you already have a business website, it needs to be professional. Even more important, make sure it is user friendly and well put together. If a lender sees a poorly put together website, it will not look good. Also, your business email address should have the same URL as your business website. Do not use free hosting services or free email services.

Tip# 2: Consider Collateral Options and Personal Guarantees

Of course, sufficient collateral is one of the best ways to get easy business loan approval. It reduces lender risk, which is one of a lender’s main objectives. Lack of collateral doesn’t necessarily mean denial, but having collateral definitely increases approval chances.

If you have good personal credit, a personal guarantee will for sure improve approval chances. Most traditional lenders will require it anyway. Still, you can sometimes reduce lender reliance on a personal guarantee if you have good business credit.

Tip 3# Evaluate and Improve Business Credit

If you have set up your business to be fundable, you already have a head start on this. To begin building business credit, you need accounts in your business name reporting to the business credit reporting agencies.

Before you can start, you need to get a D-U-N-S number from Dun & Bradstreet. Then, start working with starter vendors to get accounts reporting. This process takes time, so if you do not already have established business credit, and you need a loan now, you may have to rely on collateral and a personal guarantee to get you there.

Still, building business credit is wise, and it’s never too late to start.

Tip# 4: Research Lenders and Products

There are many types of loans and lenders. You need to know which ones will work best for you and your situation. The truth is, applying for the right product for your business, from the right lender, at the right time, will go a long way toward easy business loan approval.

Types of Business Loans: Traditional Term Loans

With a traditional lender term loan, you are almost always going to have to give a personal guarantee. If your personal credit score isn’t good, approval is unlikely. Of course, strong collateral can help with that.

So, what kind of personal credit score do you need to have in order to qualify for a traditional term loan? For most, a FICO of 750 is good. Sometimes, you can get approval with a score of 700+. Yet, the terms will not be as favorable.

If you have really great business credit, your lender might be more inclined to be a little more flexible. However, your personal credit score will still weigh heavily on the terms and interest rate.

Types of Business Loans: SBA Loans

These are traditional bank loans, but they have a guarantee from the federal government. The Small Business Administration, or SBA, works with lenders to offer small businesses funding solutions that borrowers may not be able to get based on their own credit history.

Because of the government guarantee, lenders can be more flexible with credit score requirements. It is possible to get an SBA microloan with a personal credit score between 620 and 640. The trade-off is that the SBA loan application process is lengthy.

Types of Business Loans: Lines of Credit

This is revolving credit, like a credit card. Rates are typically much better than a credit card however. For these, the application and approval process is similar to that of a traditional term loan.

Types of Business Loans: Non-Traditional Lenders

These are lenders other than traditional banks and credit unions that offer term loans and lines of credit. Generally, they offer more flexible approval requirements and a much faster application process. Typically, you can apply online and get approval in as little as 24 hours. Better yet, funds may be in your account within 24 to 48 hours after approval.

These can work well if your personal credit isn’t terrible and you need funding quickly. Additionally. they may be a good option if your NAICS code is high risk.

Knowing the different options, and what is required by each for approval, will help you choose the options that will work best for your needs and that you are most likely to be approved for.

Tip #5: Have a Workable, Professional Business Plan

For easy approval, you have to convince lenders that your business will be a good investment. It’s best to hire professional writers and researchers to help you write your business plan. If you can’t, there are plenty of free resources online to help with a business plan, including templates.

A well put together business plan should include the following:

An Executive Summary
Description
Strategies
Market Analysis
Analysis of audience
Competitive Analysis
Plan for Design and Development
Plan for Operation and Management
Financials

How to Get Easy Approval for a Business Loan

The simplest way to ensure you can easily get the funding you need for your business is to build strong business fundability. To do that, you need to set up your business with a fundable foundation and begin building business credit, among other things.

A business credit specialist can help you assess your current fundability, and guide you through the steps needed to improve it, if necessary. They can also help you find the best financing options for your business based on your current fundability. Get a free consultation today.

The post Easy Business Loan Approval: 5 Tips to Make it a Reality appeared first on Credit Suite.

10 Steps for Creating a Fundable Business Setup in 2022

It’s a new year. Whether you have a new business or you have been running your business for a while, these tips will help make sure you have a business setup for success in 2022 and beyond.

Why Does Your Business Setup Matter?

The way you set your business up affects its fundability. It cannot be fundable if it is not built on a foundation of fundability. What is fundability, and what are the building blocks of a fundable foundation?

Fundability is a business’s current ability to get funding. Of course, there are things you cannot control related to fundability. Yet, there are plenty of factors you can control. These are what you need to focus on. They include setting your business up with a fundable foundation, and more.

Business Setup: a Fundable Foundation

Follow these steps to build a fundable foundation for your business.

Step 1: Don’t Neglect Your Business Name

This is more important than you may think. It includes a lot more than just choosing a name. First, check with your Secretary of State to find out if they require that a business name be unique.

Then, keep any indication of a high-risk or restricted industry out of your business name. Your business can be Rachel’s rather than Rachel’s Gas Station. This can help prevent an automatic or nearly automatic denial from a lender just because of the type of business. It can increase the chances that your business actually gets a chance at funding.

If your business is perceived as high risk from the beginning, the application may not even get to the underwriting process.

Step 2: Address Your Business Address

A fundable business setup includes a physical address where you can receive mail. Never use an UPS box or a P.O. Box. In fact, some lenders will not approve and fund unless this is the case. If you don’t want to use your home address, you can use a virtual address. In fact, it’s not a bad idea if you need to hold a meeting or an interview. Regus, Davinci, and Alliance Virtual Offices are all good options. Still, keep in mind that there are credit providers that will not accept virtual addresses.

Step 3: Make the Right Call With Your Business Phone Number

Not surprisingly, toll-free phone numbers are best. Lenders see them as a sign of business credibility. It’s very easy and inexpensive to set up a virtual local phone or a toll free number. If you want to avoid a separate phone, just have your business number forwarded to your personal phone.

Additionally, your business number needs to be listed with 411 for most credit issuers and lenders to approve you. Check for your record to see if you’re listed. While you’re at it, make sure your information is accurate. No record? Then use ListYourself.net to get a listing.

Step 4: Jump in With An EIN

Now, get a free EIN for your business at IRS.gov. This is an identifying number for your business. It’s similar to your personal Social Security Number. You’ll use it on all of your business documents.

Step 5: Set Up an Incorporated Business Entity

Incorporating gives you more credibility in many cases. It sets up your business as separate from you, its owner. Of course, by default incorporating reduces your personal liability. Other entities, like sole proprietorships and partnerships, do neither.

Step 6: Get Licensed

Contact State, County, and City Government offices to see if there are any required licenses and permits to operate your type of business. Licensing requirements differ depending on state, town, and industry. Always make sure you have the proper licensing for your corporation. Often, your Secretary of State will have this information.

Step 7: Open a Business Bank Account in the Business’s Name

You must have a separate, dedicated business bank account. Keep in mind, you have to keep business and personal funds separate for the IRS anyway. Having a separate business account makes that process easier and reduces the risk of audit at tax time.

More than that, many credit issuers require a business bank account before they will approve you for an account. In addition, the date you open your business bank account is the day that lenders consider your business to have started.

As a result, it doesn’t matter if you incorporated your business 10 years ago. If you just opened the business bank account yesterday, then in the eyes of credit issuers your business started yesterday. Since there is a minimum time in business requirement on almost all business credit accounts, the sooner you open your business bank account, the better.

A business bank account is also required for getting a merchant account, so your business can accept credit cards. For years, studies have shown that customers spend more with plastic than with cash.

Step 8: Do Not Underestimate the Importance of a Business Web Domain and Professional Website

It’s highly likely that lenders and credit providers will research your business online. As you can imagine, it is best if they learn everything directly from your business website. Not having a company website can hurt your chances of getting business credit. Keep in mind though, an unprofessional website can do just as much damage.

You need it to be a professional website. That means it’s got to have helpful information for anyone who finds your company online. Additionally, it should be hosted professionally. Buy web hosting from a hosting company like GoDaddy or HostGator. Try to avoid a free version of a hosting service like Weebly or Wix.

Your domain should be your business name, if possible. A free Wix or Weebly domain does not look professional. For example, www.yourbusiness.com appears much more professional than www.yourbusiness.wix.com.

Furthermore, you need a company email address for your business. Guess what? It needs to be on the same domain as your website. It often comes with a website domain provider such as GoDaddy. Do not use Yahoo, AOL, Gmail, Hotmail, or other free email services. Again, owner@yourbusiness.com appears much more professional than yourbusiness@yahoo.com.

Beyond the Foundation

After you set your business up with a fundable foundation, the next business setup consideration is risk. For some businesses this isn’t an issue at all when it comes to funding. Yet, for others, it can be tricky.

Step 9: Choose NAICS Codes Wisely

The North American Industry Classification System (NAICS) is the standard used by Federal statistical agencies. You choose your NAICS code on the IRS website.

There are inherent issues in every single industry. However, those listed under certain NAICS codes are considered riskier than others. It doesn’t matter if the business is prospering, they are still considered a risky business. Usually higher risk comes from chances of injury or frequently engaging in cash transactions, or a low barrier to entry.

The IRS, lenders, banks, insurance companies, and business CRAs use NAICS codes. They are trying to determine if your business is in a high-risk industry classification. The NAICS puts out a list of high-risk and high-cash industries. Higher risk industries include casinos, pawn shops, and liquor stores but the NAICS list is old and has not been updated in years.

Why Risk Matters

When it comes to funding, risk matters big time. There are several industries where lending institutions are hesitant to do business. In those particular cases, there are stricter underwriting guidelines. In contrast, some industries are considered so risky they are automatically denied.

Those businesses are left looking for other business funding solutions.

These can include:

Using a Different NAICS Code

Of course you want to be impeccably honest when it comes to selecting your NAICS code. Still, if more than one can apply, you don’t have to choose the one that’s higher risk. It pays to check and be careful when making your selection.

If only high risk codes apply, there’s nothing at all wrong with changing your business to match a related but lower risk code.

Step 10: Be Consistent!

A big reason for many credit and loan denials is inconsistent business information. This makes it hard for the lender to locate a business offline or online. It also sets off fraud alarms in the minds of those making lending decisions.

To avoid this, make certain your business name and other information is the same everywhere. That includes incorporation papers, licenses, utility statements, and bank statements among other things.

If you change your business name, be sure to change it everywhere.

This means you change it in these places, among others:

Your website
411 listing
Your records with the business CRAs (D&B, Experian, and Equifax)

Minor details such as using an ampersand in your name in one place and the word “and” in another can cause a lot of problems. Be careful and consistent with all business information.

First Funding Options

While you are working on setting up your business, you are going to need funding. If your business setup is not yet conducive to fundability, you’ll need to pursue some alternative options. One great possibility is the Credit Suite Credit Line Hybrid.

Credit Line Hybrid

A credit line hybrid is a form of unsecured funding. Our credit line hybrid has an even better interest rate than a secured loan. You can get 0% business credit cards with stated income, and many of these report to business CRAs. That means you can build business credit at the same time.

This will get you access to even more cash with no personal guarantee.

Credit Line Hybrid: Terms and Qualifying

You need a credit score or a guarantor with a credit score of at least 680. There is no requirement for financials, and you can often get up to $150,000. Be aware, some cards may report on your personal credit.

Business Setup for Fundability

Honestly, you cannot build a fundable business without first having a fundable foundation. This is what the business setup is all about. All other aspects of fundability hinge on the foundation, so don’t neglect it. Don’t skip it. If your business is already operating and you need to backtrack to make this happen, do it now. The sooner the better.

The post 10 Steps for Creating a Fundable Business Setup in 2022 appeared first on Credit Suite.

How to Use Tier 2 Business Credit Vendors to Survive Inflation

Tier 2 vendors can help you survive inflation. But how do you get them, and how can they help? First, you have to understand what they are.

What’s Special About Tier 2?

Tier 2 vendors are those vendors that you should qualify for accounts with after you have enough tier 1 vendors reporting. Honestly, these vendors open up a whole new range of purchasing power. Of course, tier 1 vendors are useful. After all, they sell things you can use. However, when it comes to building business credit, their main purpose is to get initial accounts reporting to begin building your business credit score.

Truly, there are more tier 2 vendors than there are tier 1. Yet, they will not approve you for credit without at least some business credit history, or a personal guarantee. By starting with tier 1 vendors, you can often avoid using a personal guarantee in tier 2.

Is a Personal Guarantee Bad?

No, it’s not necessarily bad. Still, it may not be something you want to get into. If you use a personal guarantee to get business credit, and your business cannot pay its obligations, you will be personally liable for the debt.

It’s best, if possible, to limit the use of a personal guarantee. When it comes to large, traditional business loans, you will not have a choice. A personal guarantee will almost always be required. So, when you can get funding without one, go for it.

Now, here are some examples of vendors that fall into tier 2. All vendors require the basics of a fundable foundation for approval. This includes:

Entity in good standing with Secretary of State
EIN
Business address- matching everywhere
D-U-N-S number
Business license- if applicable
Separate, dedicated business bank account
Business phone number listed in 411 directory

Some vendors have additional requirements as well.

Amazon

As you know, Amazon offers online shopping for virtually anything you can imagine. Better yet, they report to Dun & Bradstreet and Equifax.

Qualification requirements are the basic elements of a fundable foundation as listed above.

For Amazon, there is no minimum time in business if you have a strong business credit history. Yet, they will pull business credit reports to make sure there is at least some established business credit history. As a result, you must have a D&B PAYDEX score of 80 or higher and a good Equifax business credit score.

A PG is not required, but it may increase the likelihood of approval if you have a young or small business and not enough business credit history.

Remember, if you work through the Business Credit Builder program, starting with tier 1 vendors, you will likely have the business credit history you need.

Brex

With Brex, you have a couple of options. The easiest way to use Brex for both managing finances and building business credit is to open a Brex cash account.

Everyone who opens a Brex cash account gets a corporate card. It works just like a debit card, as it draws from your Brex cash balance daily. However, unlike a debit card, Brex reports these payments to Dun & Bradstreet. By doing so, they help build your business credit score.

Since this card is secured by the balance in your Brex cash account, and limited to that balance, you do not have to worry about underwriting.

Alternatively, they offers a more traditional card for those who qualify. This option is not limited to the balance in your Brex cash account. In contrast, it offers limits that will go up to 20x higher than that of a typical corporate card. Instead of checking your personal credit score, they base approval and credit limits on business financial information. This includes available cash, spending patterns, and more.

If you qualify for this card, your entire balance must be paid monthly.

Home Depot

Obviously, Home Depot provides products and services for home improvement needs. Their Commercial Revolving Charge Card offers your business payment flexibility. Even better, it also provides a boost to your business credit profile by reporting to D&B, Experian, and Equifax.

Qualifications in addition to basic fundable foundation elements listed above for Commercial Account with Pay in Full Terms:

At least 3 years in the business
Good Experian business credit score and D&B PAYDEX score of 80 or higher

Now, they do prefer to see a minimum of 2 accounts reporting. However, they will consider the merit of the overall application. Still, if there is not enough business credit history, or if you have been in business for less than 3 years, a Personal Guarantee(PG) is required.

Additional Qualifications for Commercial Revolving Charge Account:

No minimum time in business
You must have a good Experian business credit score and D&B PAYDEX score of 80 or higher
A Personal Guarantee (PG) is required for the revolving charge account

Quill

Quill sells a variety of goods. Generally, these include office and cleaning supplies, among other things. As for business credit building, they report to Dun & Bradstreet. At first, they may ask you to do prepaid orders of $100.00. After they approve Net 30, a minimum purchase of $50.00 is necessary to report.

Additional qualification requirements:

Good D&B PAYDEX score of 80 or higher
At least 3-5 trade accounts reporting on D&B credit report
Must be an established business for 6 months

Also, new businesses or businesses with no credit history with D&B may need to prepay purchases for 3 consecutive months until Net 30 is approved.

How to Use Vendor Credit to Prepare for Inflation

Obviously, money doesn’t go as far when inflation takes hold. But, by having vendor credit available to use, you can buy things you need before prices rise, or rise further. To beat inflation, use vendor accounts to buy the things you need regularly while prices are lower, and you’ll be ahead of the game.

The post How to Use Tier 2 Business Credit Vendors to Survive Inflation appeared first on Credit Suite.

Your Guide to Small Business Lending Trends In 2022

It’s no secret the past two years have wrought havoc on the economy. Workers were laid off in droves. Small businesses suffered. Now, with things starting to get back on track, many displaced employees have found their own entrepreneurial spirit. As a result, they are looking to start their own business. In fact, it’s being dubbed “The Great Resignation,” and it’s going to turn small business lending on its head.

What’s Ahead for Business Lending

Many of these displaced employees are in the 30—45 age range. While some are looking for other employment, many are considering starting a business. Of course, this age range typically does not yet have a huge retirement plan, or a lot of savings at all for that matter. As a result, the demand for small business financing is going to increase greatly.

Whether you are ready to start a business or already own one, there are some things you need to know about small business lending in the new year.

Interest Rates Are On the Rise

Everyone is saying it, and they’re right. Sadly, interest rates are rising. Thankfully, throughout the pandemic the Fed kept the rate low. Obviously, it was an effort to counteract all the other crazy things happening in the economy. Now, it’s becoming obvious that a correction will be needed.

It’s time to pay the piper, and the Fed is considering rate hikes as early as this year. What does that mean for small business lending? If you need business funding, or think you may need it in the future, now’s the time to jump on a loan or a line of credit.

Inflation is Coming Fast and Furious

Here is another reason to make sure you secure funding as soon as possible. Inflation is imminent. In fact, according to comments made to CNBC by Fed President James Bullard, it’s coming sooner than expected:

“… we were expecting a good year, a good reopening. But this is a bigger year than we w

ere expecting, more inflation than we were expecting.”

It’s already started, and it always gets worse before it gets better. Make sure you have access to funds now, before it costs you more to get them. Then, when you start to feel the squeeze of inflation, you have what you need.

Regulations Aren’t Likely to Change Much

Even though small business funding options are increasing, it’s not likely the industry will see tighter regulations soon. Business owners will still have to find their own reliable and affordable funding.

This is where the services of one of the business credit specialists at Credit Suite can be especially helpful. These specialists have their finger on the pulse of the small business lending industry. They can help borrowers make informed decisions based on that knowledge.

The SBA Will Likely Play a Much Smaller Role

The Small Business Administration has had a tough couple of years as well. This is due mostly to the fiasco that ensued with the Paycheck Protection Program. A good idea that must be rushed is virtually guaranteed to have problems. The SBA was directly in the line of fire.

They are working to rectify it, but their role in small business lending will likely be smaller in 2022 than it has been in the past.

Online Lenders Aren’t Going Anywhere

Not only are online lenders sticking around, but they will continue to offer more options as their role in business lending continues to grow.

The demand for business funding services that are less stringent when it comes to approval processes is stronger than ever. There are plenty of alternative small business lenders standing ready to fill the gap.

According to the 2019 Small Business Credit Survey 32% of small business applicants used online lenders, and that was before the pandemic. That number is very likely to grow in the coming year for a number of reasons. First, online lenders are typically more flexible. Also, they tend to offer a wider range of funding solutions, including:

Furthermore, they are usually faster and more efficient. Not only do borrowers get faster approval, but they typically gain access to funds faster as well. Not to mention, you can apply for funding with just a few taps on a keyboard.

It’s likely that this year and in the years to come, online lenders and other fintech companies will continue to provide lending solutions to small businesses.

Online Lender Examples

There are a lot of well established online lenders out there, and new ones are popping up everyday. Be sure to vet each one carefully, and double check details before you apply, because they can change often. We have reviews on a number of them to help.

Here are a few you can start with:

With all of these choices, we highly recommend that you check their websites directly for the most recent qualifying and term details, as these can change over time.

Credit Line Hybrid

If you need more of an alternative loan option rather than an alternative lender, a credit line hybrid may be a good option. This is a form of unsecured funding, and the Credit Suite Credit Line Hybrid has an even better interest rate than a secured loan. In fact, it can sometimes be as low as 0% for the first few months.

It’s a credit card stacking program, and many of the cards report to business CRAs. That means, you can build business credit and access cash for your business with no personal guarantee.

You do need a good credit score, or a guarantor with good credit, to get an approval. The minimum FICO is 680. There are no financials required, and you can often get up to $150,000. It is important to note also, some cards may report on your personal credit.

Fundability, Including Business Credit, Will Be As Important as Ever

With increasing demand and competition for all types of business lending, building strong fundability will be increasingly important. Part of strong fundability is having a good business credit score. There are many ways to build your business credit score.

You need help from someone with inside knowledge of the industry and relationships with the vendors and lenders that can help you build your business credit. This makes the whole process go faster and keeps frustration to a minimum. A free consultation with a Credit Suite Business Credit Specialist is a great place to start.

The post Your Guide to Small Business Lending Trends In 2022 appeared first on Credit Suite.

Tier 1 Business Credit – Dive Into the Truth

There are a lot of questions out there about the business credit tiers. A lot of business owners claim they have strong business credit and they never even considered the tiers. There is a school of thought that they are not necessary and a waste of time. Tier 1 business credit gets a particularly bad rap as being unnecessary. It’s time we dive into the truth about Tier 1 business credit.

The Truth About the Tiers and Tier 1 Business Credit

What are business credit tiers? Actually, the tier system is just how Credit Suite ranks vendor credit based on how easy it is to get approval. When you work through our business credit builder, you start by setting up a fundable foundation. Once your business is set up properly, you begin applying for Tier 1 business credit vendors. After you have enough of those reporting payments to the business credit reporting agencies, you can move on to Tier 2, Tier 3, and finally Tier 4 and advanced vendors.

First, let’s get one thing out of the way. The truth is, some business owners can build strong business credit without working through the tiers. That’s a fact. Here’s another truth. Most business owners can’t. Honestly, several factors need to fall into place perfectly to be approved for business credit accounts without working through the tiers in order.

These include but are not limited to:

Substantial income
Willingness to give a personal guarantee
Excellent credit
High value collateral and the willingness to use it to fund the business

However, the tiers are the key to gaining access to advanced vendors and more business funding without these things.

The Benefit of Working Through the Tiers in Order

The vendor tiers are set up by Credit Suite. It’s a sort of formula to allow business owners to build their business credit without any more personal guarantee than necessary. So, even if you are able to skip them, it’s not wise to do so. The tiers can still be useful as a way to limit your personal guarantees when it comes to business funding.

When you set your business up the right way, and work through the vendor tiers in order, your business can eventually fund itself with minimal impact on personal credit.

A Deep Dive Into Tier 1 Vendors

What makes Tier 1 vendors so special? These are starter vendors that will extend net terms on invoices. They do so with less focus on credit score than other vendors and creditors. Not only that, but they will also report those payments to the business credit reporting agencies.

However, it only works if your business has a fundable foundation. That includes having professional business contact information, an EIN, being incorporated, and having a D-U-N-S number, among other things.

How Do You Find Tier 1 Business Credit Vendors?

Since most vendors do not classify themselves into tiers, how do you find them? A simple search will give you a few options. However, the information changes without warning. We are always finding new vendors that fit into Tier 1, and often we discover vendors have changed their requirements or reporting standards in ways that make them no longer Tier 1 vendors.

Here are just a few Tier 1 business credit vendors we know of currently.

76

76 offers a fleet card that reports to Dun & Bradstreet and Experian.

To qualify, you need the following:

Your corporate entity must be in good standing with the applicable Secretary of State
An EIN
Company address matching everywhere
D-U-N-S number from Dun & Bradstreet
Your business license (if applicable)
A business bank account
Business phone number listed on 411

They will ask for your SSN for identification purposes. You can use a $500 deposit instead of using a personal guarantee if you have less than one year in business. Their terms are net 15.

The CEO Creative

The CEO Creative reports to Equifax and Credit Safe. They offer low prices on electronics, wireless earbuds, cameras for cars and trucks, speakers and more. They also have quality custom design and branding services. You can create your own logo, business cards, and business accessories.

There is a membership fee, and the minimum order before they will report to the business credit bureaus is $40.

To qualify, you need the following:

Your corporate entity must be in good standing with the applicable Secretary of State
Business credit history
EIN
Company address matching everywhere
Your business license (if applicable)
A business bank account
At least 120 days in business

Grainger Industrial Supply

Grainger sells hardware, power tools, pumps and more, in addition to performing fleet maintenance. They report to Dun and Bradstreet.

If a business doesn’t have established credit, they will want to see additional documents like accounts payable balance and business financials. Terms are Net 30, Net 45, Net 60, or Net 90.

To qualify, you need:

To be an entity in good standing with Secretary of State

EIN
Business address (matching everywhere)
D-U-N-S number
Business license (if applicable)
Separate, dedication business bank account
Business registered to Secretary of State (SOS) for at least 60 days

What’s After Tier 1 Vendors

When you choose to build business credit this way, you need 3 to 5 accounts reporting before you qualify for vendors in the next tier. Use vendors in Tier 1 to buy the things you need for your business anyway. As a result, you will be well on your way to building a strong business credit portfolio.

The goal is at least 10 business credit accounts reporting to your business credit report. For some, it is possible to get those 10 accounts from any tier by offering a personal guarantee. However, even if this is possible for you, it’s not always the most strategic move. It’s not wise to have all of your business credit tied to your personal credit.

Some business accounts require a personal guarantee regardless. But the more credit you can get in the name of your business without a personal guarantee, the better. Tier 1 vendors are the gateway to building a strong business credit profile with minimum personal guarantee.

The post Tier 1 Business Credit – Dive Into the Truth appeared first on Credit Suite.

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