Author: Pamela Wojcik

How to Use Equipment Financing and Leasing In Your Business

It’s hard to grow any business, whether new or established, without the necessary equipment. However, some of it can be expensive. For a new business specifically, affording equipment can feel impossible. Still, you need that equipment to make money, which lends itself to a frustrating cycle. The answer may be equipment financing and leasing.

Equipment Financing and Leasing Is a Great Option for Both New and Established Businesses

Equipment financing is when you use a loan or lease to purchase or borrow hard assets for your business. You can use it to buy or lease any physical asset. This can include items like an industrial freezer in a restaurant or an oven or a company car, you name it.

A recent report, the Equipment Leasing and Finance Association (ELFA) survey, found that 80% of American businesses lease a portion of their equipment. The list of companies using leasing includes everything from Fortune 500 companies to mom and pop shops.

Benefits of Equipment Financing and Leasing

There are many benefits to equipment financing and leasing. For example, you will pay a set amount each month, which makes budgeting easier.  Also, you can build business credit if your creditor reports your payment to the business credit reporting agencies. The equipment is the collateral. That means you do not have to potentially sacrifice any other assets.

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In addition, it’s easy to upgrade equipment after your lease ends.  This can be helpful if your equipment is something like a computer which quickly becomes obsolete. 

What’s the Catch? 

Of course, nothing is perfect.  You may have to make a large down payment.  Furthermore, you will often need to have good personal credit in order to qualify.  If your financed equipment becomes outdated, your business is stuck with it until the end of the lease or loan. Sometimes, leases can end up actually costing more than purchasing. When the lease ends, you  have to get  a new lease or to make other arrangements. Whereas, if you buy the equipment outright you can sell it if you want. 

Types of leases

There are a few different types of leases. Which one will work best for you will depend on a number of factors. 

Fair Market Value Leasing

This is also called an FMV lease. With an FMV lease, you make regular payments while borrowing the equipment for a set term. When the term is up, you have the option to return the equipment or purchase it at its fair market value.

$1 Buyout Lease

This is a type of capital lease in which you pay off the cost of the equipment plus interest over the course of the lease.  At the end, you owe only $1.  Then, when you pay the $1 you fully own the equipment. This is similar to a loan in structure, and cost as well.

10% Option Lease

This lease is the same as a $1 lease, except at the end of the term you can buy the equipment for 10% of its cost.  These leases typically have lower monthly payments than the $1 buyout option. 

How Much Can a Lease Cost?

Of course it varies, but here is an example. Say the total cost of the equipment you are leasing is $25,000.  If it is a 10% option with a 36 month term, with an interest rate of 15%, it looks like this: 

  • Monthly payment is $780
  • Total cost of the lease is $28,079
  • The cost to purchase at the of the lease is $2,500
  • And the total Cost of Equipment is $30,579

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In this case,  you would be paying an extra $5,579 over the course of the lease. That is over 1/5 added to your total cost for the equipment. If you bought the equipment outright you would pay $25,000. Of course, you would then be out  $25,000 cash all at once.  When you are leasing equipment, you pay out over the life of the lease and thus keep more working capital actually working for your business. 

Credit Suite Offers Equipment Financing and Leasing

You can take advantage of our equipment financing and leasing programs if you have been in business at least one year.  Even if your credit is not the greatest, we have options that may work. Even better, approval takes as little as 24 hours.

The minimum personal credit score requirement is 550. Generally speaking, this is considered a fair credit score, and thus much lower than what many lenders will want to see. You will also need to provide details on the equipment you are getting.  You can be approved for as much as $10,000,000 in equipment financing after a quick credit review. This type of financing often affords more favorable terms than typical business financing programs and better benefits. Our equipment financing programs work for both established and startup businesses. We work with hundreds of lenders, and we can help you find the perfect one for your needs. 

Equipment Financing and Leasing Rates and Payments

You can qualify with only two monthly payments as a down payment.  Rates are affordable, and interest is 100% tax deductible.  In addition, there is no application fee. Furthermore, the time from application to funding is generally 2 weeks or less.

Interest rates range from 7% to 25%, and depending on the amount of the loan and risk factors, you may have to provide 2 years of corporate and personal tax returns.

Are There Other Options for Funding Equipment? 

Of course, we already mentioned paying cash and taking out a traditional loan. If you have accounts receivables you can do receivables financing. That’s really better for funding cash gaps. However, if you need to collect receivable to be able to afford your equipment, it could work.

Another option is the Credit Line Hybrid. This is unsecured business financing. There are no documents required, and you can get up to $150,000.  You do have to have a credit score of at least 680 and meet some other requirements. However, if you do not qualify on your own, you can take on a credit partner that does meet the criteria.  One bonus of this option is that you can purchase the equipment outright.  Since many of the cards that are part of the Credit Line Hybrid sometimes offer low introductory rates for a short time, you could save on interest.

Find out why so many companies use our proven methods to get business loans.

Is Equipment Financing and Leasing the Right Option for Your Business?

The short answer is, it depends.  That begs the question, what does it depend on. Well, first, do you need equipment?  That’s what this type of financing is best for. Then, do you need to finance equipment? If you have the cash on hand, you need to consider it carefully.  Financing can be a good idea if you would deplete your cash reserves paying cash for equipment.

Of course, you could just take out a traditional loan. However, you may have to come up with other collateral. If you need finance equipment, using that equipment as the collateral is the easiest solution. The collateralization allows for generally better rates and terms than you would get otherwise. Contact Credit Suite today to find the best option for equipment financing for your business.

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Grants for Small Business Startup: Will It Be Enough?

Do you know how to find grants for small business startup? There are a number of grant programs out there for those wanting to start a business.  Even those already operating but still in the startup phase can benefit.  However, grants for small business startup are highly competitive.  Funds are often limited. It’s rare to get enough from a grant to fund an entire startup without needing other options.

There are Grants for Small Business Startup, But You Need More

What are options other than grants that offer free money?  I mean, that’s the best thing about a grant.  You do not have to pay the money back.  Also, bad credit doesn’t matter when it comes to grants. There are not a lot of other options that great.  However, there are a few.  

Why Use Grants for Small Business Startup

The truth is, grants for small business startup are rarely enough.  You are going to need more funding.  That said, you definitely should apply for any grants you might qualify to get.  Just be careful.  Be sure you meet the eligibility requirements before you begin the application process. 

The process of applying for grants can be tedious and lengthy.  That isn’t always the case, of course, but you don’t want to spend a lot of time on something you have no chance of getting.  By being intentional and finding the opportunities you can actually take advantage of, you increase your chances of approval and decrease your chances of wasting time. 

Any amount you receive, even if it is a few hundred dollars, can help reduce the amount of debt you have to take on.  Also, winning a grant can help your business look more viable to lenders. 

So, which grants do you qualify for? It depends.  Many grants are designed specifically for a certain type of business or business owner.  Some are not.  Here are a few possibilities to help get you started, along with some resources to do your own research.

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Grants for Small Business Startup: Available for All

There are grants options that can work well for anyone.

FedEx Small Business Grant

This grant is the company’s way of working to strengthen small business innovation.  There are 10 grants the company awards each year.  They range from $15,000 to $50,000, and if you’re a minority owned business with a cutting-edge product, this could be the grant for you.

A business must use the FedEx website to submit entries. There are a few questions to answer about your business.  In addition, there is a requirement for an elevator pitch about what makes your business special.  Also, you have to explain how you would use the grant funds. A 90 second video submission is optional.

NASE Growth Grants

The National Association for the Self-Employed (NASE) has small business Growth Grants of up to $4,000. They are for micro-businesses, and proceeds can be used for a number of things.  They can be utilized for marketing, advertising, expansion, and even to hire employees. These grants are open to everyone.  However, you do have to be an NASE member to apply.  Membership fees vary based on the membership level chosen. 

USDA Value Added Producer Grant

The USDA’s Value-Added Producer Grant (VAPG) program offers grants for small businesses.  It includes minority owned business.  Grants range up to $250,000.  They are specifically to help agricultural producers with activities that add value to their products. As a result, grants are open to those in rural areas.  They must be operating as one of the following: 

  • Cooperative
  • Farmer
  • Rancher
  • an independent agricultural producer
  • or an agricultural producer group

Grants for Small Business Startup: Minority Business Owners

Here are some minority grant options to consider.  There are certainly others out there.  However, they are not always well advertised.  This means you need to be sure to do your own research. 

First Nations Development Institute Grants

The mission of this group is to offer grants that help Alaska Natives, Native Hawaiians, and Native Americans.  They offer assistance in the application process in addition to funds.

Not only that, but there are a wide range of opportunities from the First Nations Development Institute.  New ones initiate as old ones retire. There is a mailing list you can join to receive information about new opportunities as they become available.

National Black MBA Association Scale-Up Pitch Challenge

Also known as NBMBAA, the Scale-Up Pitch Challenge has cash prizes ranging from $1,000 to $50,000.  The associate states its purpose is to help newer businesses that have an African founder that maintains equal ownership.  

A business must be a member of the NBMBAA to compete.  There is a $10 monthly membership fee.  After that, there is an online application.   If chosen, you must submit a three-minute pitch. Then, finalists go on to compete at the NBMBAA annual conference.

Grants for Women Business Owners

For female business owners, there are several grant opportunities.  These are just a few. 

Eileen Fisher Women Owned Business Grants

The clothing brand Eileen Fisher awards $100,000 per year to 10 women-owned businesses. To qualify, a woman must have at least 51% ownership, and the business must be in operation for at least three years. Also, it must bring in less than $1 million per year in revenue and have a focus on environmental or social change.  

Amber Grant 

The Amber Grant awards $500 to $1,000 per month to a woman-owned business. One of the recipients also receives an additional $10,000 grant at the end of the year. Applicants only need to tell their story and turn it in with a $15 application fee.

#GIRLBOSS Foundation Grant 

Specifically for woman-owned businesses in fashion, music, and art, the #GIRLBOSS small business grant awards $15,000.  They also offer exposure via the Girlboss website and social media platforms. Judges rate those applying on creativity, business savvy, planning, innovation in the field, need, and where they plan to work.

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Cartier Women’s Initiative Award 

The Cartier Women’s Initiative Award is $100,000 for first place and $30,000 for second place.  They award the grant to 18 female business owners from around the world each year.  Women business owners who are just getting started may qualify.  Look over the complete application for more information.

All of the finalists get to attend the INSEAD Social Entrepreneurship 6-Day Executive Program (ISEP). They will also have the opportunity to participate in workshops on entrepreneurship and business coaching seminars, as well as be exposed to networking opportunities.

Grants for Small Business Startup: Other Grant Resources

Of course, new grant opportunities open all the time.  During the COVID-19 pandemic, many local agencies have stepped up to help small businesses, including offering grant opportunities.  Sometimes, more funding becomes available allowing for new grants to open.  Here are some resources to help you find more grants for small business startup.  

Other Debt Free Options

Of course, debt free is best, so you are probably wondering if there are other options, besides grants for small business startup, that will help you fund your business debt-free.  Yes, there are. However, much like grants, they are a long shot and do not always fund your business completely. 

The two main options you have are crowdfunding for startups and angel investors.  Crowdfunding basically involves convincing several micro-investors to fund your business a few dollars at the time.  If you have a successful crowdfunding campaign it can be very effective.  Also, it’s not as easy as it sounds.  

Angel investors are not a new idea.  If you can find one, you are golden.  These are just one or two, or a small group, of investors that invest large sums.  They usually do so in return for equity in your business, meaning they want some of the future profits.  That means it’s not totally free money, but it is money for your business that you can get without being tied down by debt. Anyone can be an angel investor, even your mom!

An Awesome Non-Grant Option

Now, the truth is, it is virtually impossible to start a business debt-free.  Financing in some form is almost always necessary.  What you need is the most effective and flexible option for financing with the lowest interest rates.  

If you have top notch personal credit, that is probably going to be a traditional business loan.  However, many capable business owners do not have the personal credit score necessary.  Not only that, but you don’t want your personal credit to bear the brunt of your business debt.  You need business credit as well. There is a debt option that you can access with a lower personal credit score than what is required by traditional lenders.  Furthermore, it will help you build business credit at the same time. 

Credit Line Hybrid

A credit line hybrid is essentially an unsecured line of credit.  It allows you to fund your business without putting up collateral, and you only pay back what you use.  The funds can be used for many things, including startup costs. 

 It’s super easy to qualify.  You need a personal credit score of at least 680, which is lower than what is required by many banks. Additionally, you can’t have any liens, judgments, bankruptcies or late payments.  Also, in the past 6 months you should have less than 4 credit inquiries.  You should have less than a 45% balance on all business and personal credit cards as well.  It’s also preferred that you have established business credit in addition to personal credit.

Here is the beauty of it.  If you do not meet all of the requirements, it’s okay. You can take on a credit partner that meets each of these requirements.  Many business owners work with a friend or relative to fund their business.  If a relative or a friend meets all of these requirements, they can partner with you to allow you to tap into their credit to access funding. 

Benefits to Using a Credit Line Hybrid with Grants for Small Business Startup

There are many benefits to using a credit line hybrid.  First, it is unsecured, meaning you do not have to have any collateral to put up.  Next, this is no-doc funding.  That means you do not have to provide any bank statements or financials.  

In addition, typical approval is up to 5x that of the highest credit limit on the personal credit report. Often, you can get interest rates as low as 0% for the first few months.  This allows you to put that savings back into your business. 

With the approval for multiple credit cards, competition is created.  This makes it easier to get interest rates lowered and limits raised every few months. The process is generally quick, especially with a qualified expert to walk you through it. Also, you can build fast business credit because some of the accounts involved report to the business credit reporting agencies. 

SBA Loans

While federal grant money is preferred, other types of federal funding are available. This is another option for startup funding when grants for small business startup are not enough.  The Small Business Administration offers federally guaranteed loan programs that can help fund a business at any stage.  The applications are processed and funds disbursed through traditional lenders.  However, the requirements are easier for many businesses to meet.  This is because of the government guarantee that they have.  

You can find a lender that offers SBA loan programs using the lender match tool. Here are just a few of the programs they offer.  Which one may be right for your business will depend on a number of variables. 

7(a) Loans

The minimum credit score to qualify for this one is 680, just like the credit line hybrid.  There is a down payment requirement of at least 10% if you are using the funds for the purchase of a business, commercial real estate, or equipment. The minimum time in business is 2 years, but if you are a startup, business experience equivalent to two years will fill the requirement.

504 Loans

Funds from 504 loans can buy machinery, facilities, or land. Generally, these are used for expansion.  They work especially well for commercial real estate purchases.

They require a minimum credit score of 680 as well, and they are collateralized by the asset being financed.  There is also a down payment requirement of 10%, which can increase to 15% for a new business.

There is also a requirement you be in business at least 2 years, or that management has equivalent experience if the business is a startup.

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Microloans

These loans work well for starting a business, purchasing equipment, buying inventory, or for working capital. Community based non-profits administer microloan programs as intermediaries, with financing coming directly from the Small Business Administration.

The minimum credit score is 640, and the collateral and down payment requirements vary by lender.

The thing to remember about all loans and lenders, including those related to the Small Business Administration, is that details such as interest rates, terms, and eligibility requirements can change frequently.  Be sure to check with individual lenders for the more up-to-date information.

Grants for Small Business Startup: Are They Worth the Time and Energy?

If you find one for which you meet all the eligibility requirements, yes, absolutely it is worth it.  Any amount you get that reduces the amount of debt you need to fund your business is worth it.  That said, remember it is unlikely you will get out of having to use financing at all. So, be sure to find the type of financing that will work best for you.  The credit line hybrid will work for almost anyone, and has many benefits, including helping to build business credit!

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Organization Angels Investment

Organization Angels Investment Often brand-new services can locate affluent benefactors that are eager to spend their funding in the service in return for payment. Organization angels offer for this demand. To the brand-new service proprietor, they absolutely are angels, due to the fact that they conserve the day in a hopeless financial investment circumstance. Usually, …

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Are You Having Difficulty Meeting Your Financial Obligations?

Are You Having Difficulty Meeting Your Financial Obligations?

Of program, when you locate on your own in this circumstance you have a number of choices from handling your financial debt on your own to financial debt combination fundings or financial debt loan consolidation solutions. Prior to you take the path of using for a lending or financial debt combination assistance there are a couple of points you need to do.
You require to rest down with your expenses, your regular monthly earnings, as well as a calculator. You are most likely in the very same watercraft as the majority of as well as have adequate earnings to fulfill your commitments yet are investing cash in areas you do not recognize which creates monetary difficulty. If you gain $2500 per month after tax obligations and also your rental fee or home loan is $800, your auto $350, power $120, credit scores cards $200, grocery stores $300 and also gas $200 after that you are investing $1970 each month.
If you acquire a flavorful coffee every day on your means to function after that you are generally investing an added $100 per month on coffee that might conveniently be rerouted to your regular monthly expenses. Constantly make a checklist of points you require when you go to the grocery shop as well as clip vouchers. One more pointer is to conserve on electrical energy costs by maintaining the thermostat at a conventional temperature level.
All of these alternatives will certainly assist you conserve a considerable quantity of cash in a rush as well as assistance you remove your financial debt by satisfying your regular monthly responsibilities. You might think about a loan consolidation lending or else you may choose to utilize the solutions of financial debt loan consolidation solutions or debt therapists.
A financial obligation loan consolidation lending will certainly aid you since you can obtain the lending and also right away pay off all of your month-to-month responsibilities. Of program, you will certainly still have to make a regular monthly settlement for the financial debt combination funding although it must be significantly reduced than the amount of all of the various other financial obligations you were paying.
An additional alternative readily available to you when you can not fulfill your regular monthly commitments consists of making use of financial debt combination solutions or else credit rating therapy solutions. The disadvantage to financial debt combination solutions is just around 33% of individuals really certify for these solutions.
When encountered with a credit rating scenario where you are totally over your head and also really feel as if you have no place to transform after that you ought to take into consideration a financial obligation combination finance or financial obligation combination solutions. You must not live past your methods and also absolutely ought to not look for a financial debt loan consolidation lending or make use of financial debt loan consolidation solutions to assist you do so.

Of program, when you discover on your own in this scenario you have numerous alternatives from handling your financial debt on your own to financial obligation loan consolidation finances or financial obligation loan consolidation solutions. Of program, you will certainly still have to make a regular monthly repayment for the financial obligation loan consolidation finance although it must be substantially reduced than the amount of all of the various other financial debts you were paying. When encountered with a credit report scenario where you are totally over your head as well as really feel as if you have no place to transform after that you need to think about a financial debt loan consolidation funding or financial obligation loan consolidation solutions. You might or might not certify for these solutions, however if you do it is an excellent method to aid you pay off your financial obligations promptly and also recognize alleviation while reorganizing your financial debt as well as disciplining on your own to pay it off. You need to not live past your ways and also absolutely need to not look for a financial debt loan consolidation funding or utilize financial debt combination solutions to aid you do so.

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Kinds Of Health Insurance

Sorts Of Health Insurance

Medical insurance is developed to safeguard versus loss of revenue and also expenditures for treatment. There are 2 wide classifications of medical insurance plans: special needs earnings plans as well as clinical cost plans.

Special needs revenue plans can additionally be described as loss of earnings, loss of time or substitute earnings. This sort of plan will certainly pay advantages to a guaranteed that is handicapped and also can no more function to make a normal revenue. Repayments can be month-to-month or regular relying on the plan.

Clinical expenditure plans are stood for by a variety of insurance coverage from extremely marginal to extensive plans with several protection. Some consist of both health problems and also crashes, numerous health center costs and also various other expenses referring to treatment such as crash and also illness plans, hospital-stay plans, fundamental clinical cost plans and also significant clinical expenditure plans.

Any one of these plans could cover different mixes of the above and also might be paid in a swelling sum.Some plans cover just crashes and also not ailment. As you may envision, plans such as this are extremely certain regarding what is thought about a crash.

It is very important to comprehend what is specified as a crash as it concerns the medical insurance market: a mishap is an occasion that is unexpected as well as unpredicted.

Any kind of conversation of this kind of plan additionally uses to any kind of kind of plan that consists of unexpected insurance coverage, not simply mishap certain plans.

Mishap advantages are most generally spent for unexpected death (likewise called unexpected fatality), unintended loss of arm or leg or view (dismemberment), loss of time and/or revenue, healthcare facility costs, medical expenditures, and also clinical expenditures like brows through to the medical professional.

Life insurance coverage plans will typically be paid no matter of the reason of fatality. An unintended advantage is paid ONLY if the fatality is unintended as opposed to a fatality by all-natural reasons or health problem.

The individual that obtains the survivor benefit is called the recipient. The plan proprietor has the right and also obligation of calling recipients. Typically there is a key recipient nevertheless he/she can designate a 2nd as well as also a 3rd recipient.

The key recipient is the initial individual in line to obtain the advantage in case of the fatality of the plan owner. The plan proprietor can likewise call a 2nd recipient that would certainly obtain the advantage in case the key recipient passes away prior to the guaranteed. Some plans can consist of a 3rd recipient that would certainly remain in line after the very first 2.

There is one more crucial component in relation to mishap plans: An unintentional fatality might not be instantaneous. An individual can pass away as an outcome of an injury months after the mishap event. Due to the fact that the majority of specify that the unintentional fatality advantage will just be paid if fatality happens within 3 months of the mishap, review your plan very carefully.

Life insurance policy plans will normally be paid no matter of the reason of fatality. The key recipient is the very first individual in line to get the advantage in the occasion of the fatality of the plan owner. The plan proprietor can additionally call a 2nd recipient that would certainly obtain the advantage in the occasion the main recipient passes away prior to the guaranteed. There is an additional essential component in respect to crash plans: An unintended fatality might not be instantaneous. Review your plan meticulously due to the fact that many state that the unintentional fatality advantage will just be paid if fatality happens within 3 months of the mishap.

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Everything You Need to Know About Accounts Receivables Financing 

… And What to Do for Funding Beyond Accounts Receivables Financing 

Accounts receivables financing is not something that you hear a lot about.  There is a ton of information out there about loans, credit cards, and even lines of credit.  No one really talks about financing your receivables though. That is, until you start trying to figure out how to get cash fast.  If you need fast cash and you have open receivables, then A/R financing may be just what you need.

Don’t confuse accounts receivables financing with accounts receivables selling.  They are two different things used for two different purposes. For example, selling your receivables serves as more of a means of getting older receivables off the books. 

The buyer pays a premium and then tries to collect the full value of the receivable.  The business owner never gets any more money than the original selling price. You get cash fast and you get the receivables off the books. 

Accounts receivable financing is different.  You can do it in a couple of ways. The first is, you can simply use the invoices as security for a loan.  The other, is invoice factoring. This is a mix of selling and financing. In factoring, the factoring company pays you a portion of the value of the invoices.  Then, they collect what they can, hopefully full value. They then keep their set, agreed upon fee, and send you the difference. 

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This means that the amount you get when you first factor the invoices may not be all you get. You will still get the difference in the amount collected less what you have already received and the factoring fee. 

What Are the Benefits of Accounts Receivables Financing?

Accounts receivables financing is not the best choice for every business in every situation, but there are some times when it truly is the best option.  Done correctly, there can be many benefits. For example:

  • Faster, less complicated process than what is typical with other types of financing
  • Accounts receivables financing premiums are often less than the interest rates and fees with traditional financing. 
  • In some cases, it is easier to qualify for A/R financing because lenders look at the quality of your invoices rather than your credit history.  
  • You get your money faster.
  • Accounts receivables financing can happen on an ongoing basis so as to bridge the cash gaps due to slow collections. 

How Do You Qualify for Accounts Receivables Financing? 

While all financing companies have their own qualification requirements, these can give you an idea of the minimum most require to be eligible for accounts receivable financing. 

  • They must, of course, issue invoices to customers
  • There must typically be at least $50,000 in annual revenue 
  • Usually they require that a business has been in operation for at least 6 months
  • Customers must be creditworthy, meaning they are likely to pay their invoices

It is important to remember that, while there are some instances where the financing company will take on the task of collecting on the invoices, the debt is still the responsibility of the business owner receiving the financing. Regardless of who is doing the collecting, if the invoice is not paid, the business owner is still responsible for the debt to the lender. 

Where Can You Get Accounts Receivables Financing?

There are many lenders that offer this service.  Here are just a few. 

1st Commercial Credit

This lender has been around for 15 years.  They offer invoice financing starting at .69% to 1.59% or Prime +2 and an administration fee.  1st Commercial Credit boasts a fast approval process, and they do not require financial statements for financing up to $350,000.  You can set up your accounts receivables financing with them in as little as 3 to 5 days. 

New Century Financial 

New Century Financial offers invoice financing up to 90% of the original invoice.  They claim streamlined, fast processing with no hidden fees. 

Blue Elephant Financing

This company works with businesses that have government contracts.  They offer account receivables financing related to FEMA, HUD, and other government contracts. Blue Elephant Financing prides itself on an easy application process and fast turnaround. 

Capital Plus Construction Services

Capital Plus offers accounts receivables financing related to construction contracts specifically.

Star Funding

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This company will not only do accounts receivables financing, but they will also help you collect on open invoices. This is a major plus for a lot of businesses. If you need or want collection help along with financing, Star Funding if for you.  They also offer accounts receivable management services.

Seven Oaks Capital Associates

Seven Oaks also offers general accounts receivables financing services along with collection and management services.  In addition, they can help you obtain credit information on those to whom you extend credit.

Of course there are hundreds of companies out there that offer these services.  These are just a few to get you started. 

A Word About Merchant Cash Advances

If you need a similar option but do not have a ton of open invoices, you might look into getting a merchant cash advance. This is similar to factoring invoices, but it works based on average credit card sales. Basically, you get an advance on your projected credit card sales. 

Here’s how it works.  First, you will submit information about your average daily credit card sales.  Then, the cash advance company will tell you how much you are eligible for based on that average.  

What Else Should You Be Doing? 

Now, the allure for many small businesses is that this type of financing doesn’t require great credit.  In fact, if your invoices are solid, the factoring company may not even do a credit check. If you have bad credit or no credit,  that is a good thing. However, you need to think beyond the right now and consider the future.

Working to build business credit is vital because this type of financing will not work for every need.  

Every Small Business Needs To Establish Business Credit

This is credit in a small business’s name. It doesn’t connect to an entrepreneur’s consumer credit. Here is why you need it: 

  • Since small business credit is distinct from individual, it helps to safeguard an entrepreneur’s personal assets, in the event of court action or business insolvency.
  • With two distinct credit scores, an entrepreneur can get two different cards from the same vendor. This effectively doubles buying power.
  • Even startup companies can do this. Visiting a bank for a business loan can be a recipe for disappointment. But building company credit, when done correctly, is a plan for success.
  • Consumer credit scores depend on payments but also various other elements like credit use percentages. For small business credit, the scores really merely hinge on whether a small business pays its debts punctually.

So where do you start?  How do you establish business credit?  It’s a process that has to be done in the right order.  You have to actually work toward it. It doesn’t happen on its own.

How to Establish Business Credit

Accomplishing the steps out of sequence leads to repetitive denials. No one can start at the top with business credit. For example, you can’t start with retail or cash credit from your bank. If you do, you’ll get a denial 100% of the time.

Hit the jackpot with our best webinar and its trustworthy list of seven vendors who can help you build business credit.

Start with Business Fundability

A small business has to be fundable to credit issuers and vendors. This includes a number of things.  The first, is that a business needs its own phone number and address separate from the owner. They each need to be listed with the directories.  Do that here.  It will also need an EIN.  This is similar to a social security number, only for a business rather than an individual.  You can get one free from irs.gov.

Then, the business has to be incorporated.  A sole proprietorship or partnership won’t work for building business credit.  Whether you choose to organize as a corporation, S-corp, or LLC will depend on the level of liability protection you want and on your budget.  Any of them work for business credit building. 

Another necessary step for your business to appear fundable is to have a separate business bank account.  Do not mingle personal and business expenses in the same account. Not only does that not work for building business credit, but it makes for a tangled mess come tax time.  

Lastly, and surprisingly to some business owners, your business needs a professional website.  Along with this goes an email address that is separate from the owners. The website needs to look professional, which probably means hiring a professional to do it.  A lender will be much less likely to take you seriously as a business if you have a poorly put together website in today’s business world. The email address needs to have the same URL as the website and not be from a free service such as Gmail or Yahoo.  Also, the website needs to have website hosting from a paid supplier such as GoDaddy. Free hosting doesn’t work for this situation.

Get Accounts Reporting

Start at the D&B web site and obtain a free D-U-N-S number. A D-U-N-S number is how D&B gets a company into their system, to produce a PAYDEX score. If there is no D-U-N-S number, then there is no record and no PAYDEX score.

After you do this, you can start establishing tradelines that will report to the credit reporting agencies (CRAs).  These are part of the vendor credit tier. They are starter vendors that will extend invoices with net terms without a credit check.  When they report your payments, your credit score will begin to grow. 

Find out our picks for the easiest starter vendors to start with here. 

Retail Credit Tier

Once you have several vendor trade accounts reporting to at least one of the CRAs, then you can move onto the retail credit tier. These are companies like Office Depot, Staples, and Lowes.  The reason you have to go through the vendor credit tier first, before applying for these store cards, is that they need to see a PAYDEX score to grant approval. 

For example, Lowe’s likes to see a PAYDEX of 78.  The only way to get this is to start in the vendor credit tier. 

As you handle credit in the retail credit tier responsibly by making on time payments, your credit score will grow even more. 

Fleet Credit Tier

After there are several accounts from the retail credit tier reporting on-time payments, your score should be strong enough to apply for cards in the fleet credit tier. These are businesses such as BP and Conoco. Use this credit to purchase fuel, and to fix, and maintain vehicles

One such example is Shell. They report to D&B and Business Experian. They need to see a PAYDEX Score of 78 or more and a 411 small business telephone listing. This is another reason why a business contact listing is important.

Cash Credit Tier

Once you work through the vendor credit tier, the retail credit tier, and the fleet credit tier, your score should be stable enough to apply for cards in the cash credit tier. These are companies like Visa and MasterCard, but not related to a specific retailer as in the retail credit tier.

Monitor Your Business Credit

As you go through the tiers, and even after you are beyond the cash credit tier, you need to know what is happening with your credit. Make sure it is being reported and take care of any inaccuracies as soon as you can. 

Hit the jackpot with our best webinar and its trustworthy list of seven vendors who can help you build business credit.

We can help you monitor business credit at Experian and D&B for 90% less than it would cost you at the CRAs. See: www.creditsuite.com/monitoring.

Accounts Receivable Financing Can Be a Great Option, But Don’t Stop There

Whether you are looking into accounts receivable financing because it is the best option for your needs or because it is the only option due to credit issues, you can work on building business credit in the meantime.  Personal credit is just not sufficient for business expenses.  

Our tried and true method for establishing and building business credit will ensure you have strong business credit.  Then, your financing is only limited by you needs, and not by your options.   

The post Everything You Need to Know About Accounts Receivables Financing  appeared first on Credit Suite.

CareRev (YC S16) Is Hiring a Director of Operations (Venice Beach, CA)

Healthcare cost represents 17% of US GDP. That’s 3 trillion dollars! A large portion of that is costs associated with nurses, doctors, and other healthcare professionals. Healthcare staffing has historically been dominated by telephones, fax machines, and paper calendars. CareRev is a technology company revolutionizing and modernizing healthcare staffing. For hospitals, we provide a flexible, high-quality, lower-cost workforce. For professionals, we help them make more money on their schedule.

We are looking for an entrepreneurial Director or Manager of Operations to build our operations, customer success and customer support organization as we scale the company. Reporting to the COO, this position will be responsible for maximizing satisfaction, retention, lifetime value, and general love of CareRev for the nurses, hospitals, and other healthcare facilities on our platform. We are growing 15%+ monthly and launching new cities, so things are moving fast!

Job Description:
* Work in partnership with the COO to set the overall vision for our Operations team.
* Understand our customers and their goals so that we can consistently exceed their expectations. Champion customer needs internally and within product roadmap.
* Build, manage and coach internal and external support teams.
* Implement new processes and systems to optimize and automate how we interact with and serve our customers. Work with engineering to build supporting features into our products.
* Collaborate with marketing on communications.
* Develop metrics and reporting systems to track performance and progress.

Requirements:
* 4+ years overall Customer Success/Support experience working with business and consumer customers. Ideally, that experience would include hands-on work at a large company known for customer excellence as well as leading a team at a high-growth technology company. Director vs Manager title depends on level of experience.
* Ability and willingness to both lead a team and do front-line work yourself.
* Adept at translating complex business and organization problems into simple solutions utilizing people, processes, and systems.
* Thrive in a fast-growth, dynamic work environment.
* Excellent communication and interpersonal skills. Ability to empathize and connect with your team and customers.
* Fluency in common tech startup technology and customer support tools.
* Bachelor’s degree required. MBA desired.

Who We Are:
CareRev is building the #1 staffing platform for healthcare professionals. Hospitals and medical centers in California, Florida, Chicago and other cities book thousands of specialized professionals through our app every month. We have a smart, collaborative, fun team passionate about building an amazing company and changing the world for the better. CareRev has an amazing group of investors including top healthcare VC firms and Y Combinator partners and alumni. We offer full benefits, and our office is 2 miles from Venice Beach.

Comments URL: https://news.ycombinator.com/item?id=21266301

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