If you’re a company who extends trade credit, or is at least considering doing so, you know it’s no simple business operation. You are essentially allowing your business to act as a bank. Surprisingly, the facts show that this doesn’t make small businesses shy away from it. Choosing to extend credit is a big decision, however, a smart one. Here’s everything you need to know about trade credit, and why you should be extending it if you aren’t!
Last week the White House announced that government spending cuts due to take effect March 1 would greatly impact the average American and the U.S. economy. On Monday, it brought forward that the Small Business Administration's guaranteed loan programs are on the government’s $85 billion chopping block. Specifically, cuts to the SBA lending program would amount to $540 million this year, which could translate to potentially 1,100 small businesses being denied a SBA backed loan.
We find the week's best small business articles so you don't have to. Here are the top stories from this week:
I read an article by Scott Shane published last week in Small Business Trends on the subject “Are Banks Losing Interest in Small Business?” I almost skipped reading the article; assuming that it was yet another summary of lending statistics from the past month released by Thomson Reuters/Paynet or Biz2Credit. While I appreciate the information that those groups (and others like them) give us, the statistics are increasingly contradictory. Approval rates at big banks for small business loans seem to be improving while community banks and credit unions are staying about the same or even declining.
Everybody wants to get paid and everybody wants to get paid on time. Getting paid is a business of itself, and it takes diligent management of your receivables to make it happen. However, not everyone realizes how much attention receivables really do require. They want the money, but not necessarily the work it takes to set-up a seamless system to make getting paid possible. If you’re doing one of the following below, you are not managing your receivables in the most effective way. But, change these habits today, and you’ll find getting paid is a lot less painful than one could have ever imagined.