Business Loan Option Blog

If you are thinking about starting a small business, then most likely, you will be in the market for a small business loan. Unless you have the money to start your business up front, a loan is going to be one of your only options.

When it comes to loans and finances, though, you can easily get confused in the jargon and fine print of the loan process. In order to make sure you are getting the right loan with the terms and conditions that will work for you, make sure to ask the following questions before you sign any paperwork.

What will be the fees for this loan? Some lenders charge loan fees up front, while others will roll the fees into the loan itself. In any case, you will need to know how the fees are to be paid and how much they will be.

Will there be a pay early charge? Hopefully, you will have enough revenue from your business to pay your loan off early and avoid quite a bit of interest. However, some lenders charge a fee if you pay the loan off too early. Make sure you ask about any prepay fees involved.

Do I need collateral to secure this loan? You may have to use your mortgage or other personal property as collateral in the loan process. If you are unable to pay the loan back, the lender will be able to seize the property.

Make sure you understand what collateral you will need and the policies involving repayment. Make sure also that the lender will release the collateral as soon as you repay the loan.

What are the grace periods and late fees on the loan? Most companies will offer you a one to two week grace period before late fees kick in. Make sure you know what period it is and what fees you will be charged if you pay late.

By questioning each part of the small business loan process, you will have a better understanding of what you will be dealing with once you sign the papers.

The contact list is the heart of your sales leads. Having a large number of people on your list, however, is not what determines how well your marketing efforts pay off. Until those leads convert to sales, they are basically just people you know, not customers. In order to really mine a customer contact list, you should have several strategies in place to get to know your customer’s wants, and then find ways to fulfill those wants through promotions and offers.

Categorize Your Contact List

One of the first things that you should do is understand the demographic of the people signing up to your contact list. Maybe you are selling services that would appeal to new graduates. In that case, you should have a clear idea of the number of 2009 college graduates that are on your marketing list and where they can be reached. You should seek to add more of this demographic to your contact list, every chance you get as they will be your best customers.

Another way to categorize the lists is through income levels. Some people will consistently buy lower priced items, indicating a small income, while others are more generous. By watching the buying behavior of the customers on your contact list, you can start to plan promotions that align with their income level.

Contact Your List Frequently

When was the last time you contacted a person on your list? Do you know when they have been contacted or marketed? If you’ve set up different categories and sales plans for those demographics, they should also each have some schedule of contacts whereby they are marketed somewhat frequently. Email is the best way to do this at a minimal cost, however, it shouldn’t be overused and permission to contact someone electronically should always be gotten first. If you want to make sure that no one lands on your list for email marketing without their expressed consent, be sure to use a double opt-in form on your website. It makes them put in their email address and then verify the sign up via that user email. This keeps spam bots and malicious sign ups from occurring and causing you significant problems when people complain about it.

Solicit Their Feedback

A contact list isn’t just to talk to, it should also be listened to, and very carefully. Don’t be afraid to solicit feedback from the get go by asking people who sign up to identify what their needs or wants are, even before they’ve bought something. You can do this by offering a small poll or survey that they can fill out voluntarily in exchange for a discount coupon off their first purchase. The information you receive will be highly targeted and help you to define where your best efforts are when selecting products and services that might appeal to your core audience. In addition, the incentive of a thank you coupon can spur a sale almost immediately, particularly if it is a time-limited offer.

As you know, running your small business can be difficult, and getting attention to your company when you do not have a multi-million dollar advertising budget can be frustrating and it may feel downright impossible.

The truth is, a small business has to be marketed differently. You have to recognize that you do not have the funds or the marketing teams of the large companies who may cause you competition.

How do you make your business stand out from the others? You have to avoid the common mistakes that many people make when marketing their business. The biggest mistake you can make is to compare yourself to competitors.

You will only be reminding potential customers that there are other places where they can shop. You cannot get lost in a sea of businesses offering the very same goods and services. If you do, you will be leaving customers up to chance.

Instead, you have to make sure that your business stands out. You must, in some way, be different from the rest. There are many ways to make this happen. First, make sure potential customers know what your business is.

Instead of having a paragraph that describes what you offer, choose a short and easy to read tagline that truly sums up your company. If you offer more than one thing, focus on the main ones. If you overwhelm people with information, they are less likely to even read it.

You want your customers to know what your business is about, but in a catchy way. Get your employees involved, or even have a contest among regular customers to find a line or phrase that describes your business the best.

Once you have established with potential customers just what it is you offer, you will need to make your company different from others that offer the same thing. Whether you choose to find this unique image through specific services or goods, through excellent customer service, or through sales or price cuts, you need to show that you are different.

After you have made sure that you have the right image, you can begin marketing that image. You will need to find the best way to reach your potential market. Remember that word of mouth goes a long way, so do not forget your current customers while you look for new ones.

You can even offer bonuses or specials to people who were referred by another customer. You can give current customers a reason to refer by providing discounts to them for everyone they send your way, and provide a special to the new customer.

This helps get your name out through customers who are already satisfied with your company. A real testimonial to the excellence of your business can go a lot farther than anything else you could do.

When it comes to advertising, since you are a small business with a limited budget, make the most of your money. Instead of saturating markets that are too far from your business, choose to target areas that have the most potential customers.

You can purchase mailing lists for certain areas so that you do not send out advertising to the wrong places. Speaking of a mail out, you may want to invest a little more into the style and design or your advertisement. Consider hiring a professional graphics designer for the project.

Though you will be spending more, you will find that the end product is much more professional and eye-catching. People receive a great deal of mail every day. If your advertisement looks plain, unprofessional, or boring, it will most likely end up in the trashcan.

Make sure that all advertisements and all correspondence have your company logo and catchphrase. You want people to always associate your company with a certain look. By consistently using the same visual effect of a logo, people will see it and immediately know it is you.

Do not be afraid to use small marketing items that you give away, like pens, notepads, calendars and t-shirts. There is a wide variety of these marketing tools, and they do not cost that much when bought in bulk.

Just think of the impact one pen with your business information on it can have. Your customer uses the pen in grocery stores, at other offices, or anywhere and other people immediately see you name. Alternatively, your customer gives the pen to someone else, and again, your name is seen.

Spending a little money on promotional items can go a long way. In addition, customers like receiving free little gifts, and this will help your overall reputation. Just make sure that the items you choose are professional and eye-catching.

When it comes to marketing your small business, you have to keep in mind that you cannot match the larger businesses dollar for dollar. Instead, you have to find ways to stand out and to show that you are not just like everyone else.

The major mistake most businesses make during slow economic times is to slash their advertising budget. While business owners may convince themselves that this is a smart move, studies have shown that those companies that actually increased their advertising budgets during the Great Depression actually came out ahead after the depression was over. The reason for this vary from increasing their market share while their competitors failed, being more in the public eye than their competitors, to brand name recognition that built a loyal following even after the recession was over. Those businesses that decreased their advertising were quickly forgotten by the general public and suffered the consequences of a self-fulfilling prophecy of lower demand, which was their main reason not to advertise. While it’s true that advertising is an expense that may or may not return immediate dividends during a tight economy, in the long run it positions a company to grab more market share. Luckily, in these modern times, the Internet has made it possible to cut costs in traditional advertising, while increasing exposure online to a bigger audience, making your new advertising campaigns an experience in fun budgeting.

Online Affiliate Programs

One of the best ways to get great exposure for less monies is to offer an online affiliate program for publishers to advertise your products in return for a slight commission. A good affiliate program will encourage people to spread the word about your products and services and recompense top publishers effectively. You can even offer a sign and referral bonus with multi-tiered affiliate programs that encourage your affiliates to sign up sub affiliates to increase the number of people advertising your products. Affiliate programs can be as inexpensive or as costly as you want to make them. There are a variety of different networks that provide different perks to advertisers and can get you listed in their network of publishers. If you only want to pay for performance instead of click exposure, you can sign up with the newest types of affiliate banks that offer cost-per-action programs. This way, even if you don’t make a sale, you can still get a customer lead to market later. This appeals to business owners who want to be able to determine how effective their dollars were in generating leads or sales, instead of just click exposure.

Check Out Social Networks

Twitter.com and Facebook.com are quickly becoming a new type of search engine that might one day rival Google.com. Even if that doesn’t happen right away, these social networks offer a quick way to connect and listen to the people in your target demographic. All you have to do is set up a profile with your name and your business interests. Check out other people online by joining groups or setting up a sales page. Network online to determine what topics are most relevant to your sales demographic and use that information to develop and market products that sell right away upon release, even in a tight economy. Anyone can join these sites and it doesn’t take an expert to generate a substantial following of people. If the terms of the service agreement allow you to publicize your new offerings, promotions, and articles on your website, it can be a great way to identify and drive just the right customer to your online store.

If you have been diligent in collecting the email addresses of the people who enter your offline retail store and online website, you have a great tool to market and advertise your current business. Email marketing is one of the cheapest ways to get the word out and it can be done very effectively with a single group email address. It doesn’t cost anything in postal charges, and as long as you are adding value to email and not just spamming your customers, they will appreciate what you have to offer. Some ways to use this valuable tool is to send them discounts, special store promotions for valued customers, and other perks that they can’t get otherwise. It will be certain they will take the time to check out the email if you’ve helped them to save money during a tight recession.

Use Other Non-Traditional Venues

Don’t limit yourself to online advertising for non-traditional ways to save money. You can always use radio spots, billboards, and even people wearing sandwich boards to get the word out about a sale or promotion. Sponsor a contest and see if your customers can find innovative words to advertise for you. When you begin to get into the spirit of this new wave of advertising, you will find it saves you money and is fun too!

Whether you have already thought about it or not, you need to make sure you have proper insurance coverage for your small business. If you already have insurance, you may want to take a moment and review your coverage. If your business has grown since the policy was created, it may not cover your company like it needs to.

In order to make sure that your business has all of the insurance it needs, you will need to consider the two key areas of small business insurance: your employees and you and your business.

First, you will need to make sure that your business is properly insured. Consider property insurance. This insurance policy needs to cover not only the building where you are located, but also all of your equipment, supplies, and technology.

The insurance policy should cover everything, since you could stand the chance of total loss. This is not an area to cut corners. Instead, make sure you are properly insured. Also, consider natural disasters that may not be covered in a standard policy. You may need to add on flood, earthquake or sewage backup policies if you are in a prone area.

Make sure that you are completely insured as well. You will need both health and life insurance. Since you are a business owner, and your income comes from the business you own, you will want to make sure your family will be all right if something were to happen to you.

The second area that you must consider is insurance for your employees. While offering insurance can include a hefty price tag for a small business, the cost can be outweighed by the positives.

In order to find and keep quality employees, you will need to be able to offer life and health insurance, or the latter at the very least. In addition, an employee covered with health insurance is more likely to stay healthy and be at work.

There silver lining is in the worst of black clouds, and this recession is no different. For small business owners that are not over leveraged, this is a great time to buy up the competition or other holdings that enhance your own product line. Many businesses are failing in this touch economic climate, but the positives about the economic situation is that those businesses that are left standing end up with more market share. That means that you will have more customers, and when the recession is over, you stand to make a great deal more profit too. That’s why it’s key to start planning for a recovery and increase the potential to profit, while the recession is still under way.

Look For Struggling Competitors

The first place to look to increase your piece of the pie is at your competitor’s doorsteps. They may not be in as strong a financial position as you and would welcome a buy out offer. If their business falls in line with your market niche, you stand to gain many of their customers and their holdings too. If they are in a regional market where you are weak, you can expand into new areas without having to fight off your competition too.

Look At Businesses With Complementary Services

Another great way to diversify your business model is to snap up complementary businesses at a discount. Businesses that may be doing poorly on their own, might be the perfect match for your products and services. Another way to do create a stronger company is to buy the expertise that your company lacks. If you have a residential mortgage company that is pulling in less money, but continues to be in a stable market, look at other business partners who can increase the over all expertise into other areas, like foreclosures or commercial properties. If you buy the company outright, all the staff can come with it and can help you diversify your business overnight.

It’s very hard right now to get a customer in your store, much less one that buys a product or service. That’s why every sales lead you get, whether it’s online or a walk-in consumer should be treated with the utmost care and attention. If you want to know how to survive a depression, pay attention to each and every customer as if they were gold – because they are! Many business owners fail to realize that they are losing sales at the front lines because people do not like to provide negative feedback to a manager in person. If you put out a suggestion box, it’s possible some might take the time to provide suggestions, but many will simply walk out of the store and go somewhere else – usually, to where they are better served. To improve your customer service, check out what others are saying about you and your store and make sure to train your staff in the proper way to close a sale.

What Are They Saying About You Behind Your Back?

These days of online gossip mean that, odds are, someone is talking about you or your business online. It may be a great review, or unhappily, it may be some pointed criticism. Either way, you can gain valuable insight into how to improve your customer service by logging online and finding out what others are saying about you. If your business is listed in profile services that offer their customers a chance to rate or provide feedback, you should be checking these regularly and addressing any concerns that arise. It may be hard to read criticism about your business, but it’s better than not knowing what others are saying a losing customers that are hard to come by in the first place.

Teaching Good Customer Service Skills

Small business owners may not realize that the staff at the front desk aren’t aware of how to market an incoming customer. They do not listen to their needs, or dismiss them if they don’t have exactly the product the customer wants. Training staff on how to make helpful suggestions, how to cross sell, or up sell a customer can help produce better results in customer satisfaction as well as at the cash register.

There are some businesses that are prime candidates to cash in on the stimulus plan’s incentives and green wave. The Obama administration’s tax credits can mean substantial savings for consumers that want to change out a gas guzzling car, install a new furnace, or add some solar panels. In addition, local and state governments, in an effort to spur their economies, have sweetened the deal by offering their own incentives to consumers who purchase specific types of products like energy efficient home systems or a brand new home. If you’re saying to yourself, “I need money today for my business,” take time to review the following possibilities to motivate your customers to buy today. These incentives and tax credits won’t be around forever and once they’re gone, the odds are they will never come back. If your business can help consumers take advantage of the new tax credits and incentives, you can also cash in on the stimulus plan. Here are some credits that can impact how you advertise your business.

• The New Home Buyer’s Tax Credit – This is great for real estate agents and home sellers. It’s a great incentive for the new home buyer to get off the sidelines and put in a contract to buy. With housing prices at record lows, if a home buyer can qualify for a mortgage, it’s a no brainer to buy now. If you are in real estate, or in a position to refer these types of customers to real estate agents, you will have a ready source of income waiting to be tapped. The incentive is tax credit of 10% of the cost of the home up to $8,000 maximum. There are specific requirements to qualify, in particular one must have not owned a new home in the past three years. If you can find people in that demographic with money to buy, you can do business now before the credit expires on December 1, 2009. Even if you are not a real estate agent yourself, many real estate agents pay a nice finder’s fee for anyone that locates a buyer for them.

• Energy Tax Credits – Consumers who make a purchase of an newer, more energy efficient, furnace or hot water heater, can qualify for credits up to 30% of the purchase price. If you have a home improvement store, are an affiliate marketer, or do heating and air conditioning, then you have a great new sales pitch that will definitely drum up some business. Make sure you take the time to understand the incentives and credits that are being offered in your local and state level too, so that you can pass that information on to your potential customers. The credit was available in 2008, but it was capped at $2,000, unlike the new incentive.

• Cash For Clunkers – This program may or may not pass the Senate. If it does, it’s another part of Obama’s plan to reduce emissions and raise gas standards by allowing consumers to trade in poor performance cars in exchange for a tax credit on a newer, more fuel efficient, car. That old SUV that is costing your customer tons of money now may end up being the exact ticket that gets them to buy a new car. If you are a dealership this is great news for you!

• Money For The SBA – The stimulus earmarked 375 million for the Small Business Administration. This money is being used to waive fees for loans and to provide a larger Federal guarantee on subsequent loans up to 90%. This helps this program to ease lending for small business and, in fact, loans to small businesses through the SBA have increased in 2009. If you are looking to get a loan, the SBA may be the place to look.

It’s obvious that today’s businesses are shedding jobs and customers at the same time. Credit lines may be frozen or have shrunk considerably. Accounts receivables have taken a dive and every penny counts. While many businesses are going to start hunting for ways to cut expenses, they may make the mistake of only looking at the big ticket items, like cost of living raises 2009. Now is actually the best time to take a look at your operating costs, not just your staff costs, to create a business that comes out of this recession, not just leaner but much meaner, more productive, and highly competitive.

Energy Costs

One place that may seem obvious with all the talk about a green future are the energy costs that your business generates. How many business owners have really taken that to heart though, and looked at ways they can use the energy incentives in the Federal Stimulus bill to reduce their operating expenses and create a more sustainable business model? This bill gives incentives for insulation, roofing, as well as, hot water heaters and geothermal pumps. Up to 30% of the cost of the installation of a new system can come back to the business owner in the form of a tax credit.

Energy costs are just about heating and cooling, though. Electricity may not be that expensive right now, but the cost of replacing bulbs in a large facility can quickly add up. Conventional incandescent and fluorescent bulbs requires someone to keep up with the bulbs and it takes more energy too than compact fluorescent bulbs. Making a small purchase to replace all the bulbs in a facility will reduce maintenance and replacement costs significantly while reducing your energy needs.

Office Supplies

If you haven’t gotten on the recycling band wagon, now’s also a good time. Recycling office paper, ink cartridges, and equipment can lead to savings and a more efficient office. If you can’t keep up with maintenance or recycling, lease equipment from someone that can help you manage your office supply needs in a more sustainable manner.

Take Advantage of New Technology

Instead of spending to send everyone to a conference in Florida, maybe the same objective can be reached via a virtual conference call. Instead of clinging to old pc screens that eat tons of energy, opt for the flat screen versions. Instead of sending out postal snail mail promotions, find ways to advertise online and send these promotions via email to cut costs. There are so many new technologies out there to help small businesses reduce expenses that pay off in the long run, if only one takes the time to research and implement them.