Monthly Archives: August 2009

Entrepreneur’s Top Ten Growing Businesses List

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Entrepreneur magazine says that few business sectors are actually growing quickly. Here’s their run-down… ranging from nationwide to niche, markets:

1.Services: More than half the total U.S. economy,service businesses, are on the rise, as indicated by the increase in the ISM Nonmanufacturing Index.

2.Discount stores: Shares in stock of Family Dollar and Wal-Mart have risen about as fast as the rest of the stock market has fallen over the past year.

3.Fast food: Quick-service restaurants are looking good duering this tighter economy.

4.Secondhand goods: For those looking for a deal, as shown by a 19 percent earnings increase for Winmark Corp.

5.Medical office buildings: According to PricewaterhouseCoopers, which sees an aging population’s health-care needs fueling demand for medical office buildings, especially out West.

6.Netbooks: Ten million of these tiny notebook computers, priced between $300 and $500, were sold last year, up from hundreds of thousands in 2007. New models that boot faster and run longer on batteries could boost sales further.

7.Education and health services: The U.S. Bureau of Labor Statistics has projected that employment in these sectors will grow more than any other, adding nearly 5.5 million jobs from 2006 to 2016.

8.Social networking: Facebook reached 150 million users in January after just four years.

9.3-D: Once derided as a goofy gimmick, 3-D pictures are technologically much improved, and content is expanding rapidly. This year’s BCS Championship football game was broadcast in 3-D–a first.

10. U.S. personal savings — As the percent of disposable income rose from 0 percent in early 2008 to 2.8 percent by year-end. Sales of related goods, from home safes to piggy banks, are also up.

And invoice factoring is growing right along with these top ten businesses. During a tough economy, many businesses stay afloat using accounts receivable factoring.

Using Factoring for Hiring After a Recession

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Small business owners must be prepared when looking for employees, especially after an economic downturn, when there are more people deperate to find a job. And if you are worried that it may be too early to hire an employee, think about using accounts receivable factoring to ensure that you will have the funds to make payroll.

Think carefully about the job advertisement or listing, making sure you include the job’s sponsibilities, skills required.

What are the advantages your company has to offer that would make this job appealing to candidates?

You could give personality tests to people in sales and management so that you can make sure they are the right personalities foer your company and the jhob. Also some employers do drug screening to ensure performance.

Interviewing is an art, so make sure the person doing the interveiwing knows how. It does not have to be you in the initial interviews. Develop a list of questions that you believe will give you an idea of how the person thinks.

References are mandatory. Even applicants coming from companies that will not give references should be able to offer someone who can be emailed or called.

Make sure to be specific about your job offer – the hours, pay, vacation time, sick days, etc.
While there is certainly an element of luck, a good hiring process can and should improve the odds of hiring great people.

Don’t be afraid you will not be able to make payroll during tough economic times. You need employees to grow, and money to make payroll. If you have a tight month, use invoice factoring to help pay bills, including payroll.

Will Small Businesses get a Tax break?

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It appears as if small business owners in the state of Texas may get a tax cut from the government in the next year. A business with less than 500 employees is considered a small business, and today’s news is reporting franchise tax cust for small businesses, allowing them to spend their money on bolstering their business and putting it back out in the community. This will help the state economy, but we’ll also feel the effects close to home.

For example, there are roughly 39-hundred registered businesses in Victoria, TX and the mass majority of them classify as small businesses. The new legislation has raised the limit from $300,000 to $1 million, that’s the amount of revenue that a small business can take in before it’s accountable for tax.

With this in effect, 40,000 small businesses in Texas will be able to keep their money, rather than handing it over to the government.

Meanwhile for those other small business owners in other states, invoice factoring can help offset their business expenses.

Thanks to Factoring You Can Afford Small Business Marketing

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Today’s economic times call for creativity when it comes to marketing and advertising. The first issue is to figure out how you can pay for marketing. Thanks to invoice factoring, also known as accounts receivable factoring, you too can compete and get ahead via marketing and advertising.

It is important to always include an offer in your ads, and remember to make it easy way for prospects to respond to your ad.

You also might want to re-think your offerings. Do you have both a cheap and a premium version of your products and or services? Some customers are not willing to pay the asking price, so you can avoid losing sales to many of these customers by offering a stripped down version of your product at a lower price.

On the other hand, not all customers are looking for the cheapest price. Many are willing to pay a higher price to get a premium product or service. You can boost your average size sale and your total revenue by offering a more comprehensive product or service …or by combining several products or services in a special premium package offer.

Also try re-marketing to those customers who already know and trust you. It’s easier to get more business from them than to get any business from a new customer. Create a few special deals just for your existing customers. And don’t forget to also develop an incentive for these existing customers to tell their friends, family and associates about your products or services.

These are just a few of the tips that are low-cost ways for any small business to find customers and generate sales quickly. But remember it all starts with using a good business strategy such as factoring. Why wait for invoices to get paid when you can use a factoring company and begin marketing and advertising right away.

Growth During a Stressed Economy

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Jay Abraham, author of “The Sticking Point Solution” says he loves a bad economy. He believes that the areas of growth are more plentiful than they are during boom times. You can win easily, if you know how to benefit from

In a bad economy, many business owners become paralyzed, retreat and stagnate. So while your competitors are struggling to survive, all you need to do is plan to grow. By taking on a growth-minded strategy, you may capture 15 to 20 percent of your competitors and their business, thus doubling what you might have done even in an up market.

Many business owners have also discovered that during tough times, accounts receivable financing is a great way to grow, by staying current with bills, suppliers, and employees. Invoice factoring helps businesses do more business, rather than waiting for invoices to be paid sometimes 60 or 90 days out. Factoring allows businesses to survive, invest in new technology, or marketing strategies, when competitors are sticking their heads in the sand.

Could Accounts Receivable Factoring Replace Loans?

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A year ago, loan volumes dropped to about one half of their previous levels as small business lending collapsed. There was a sudden freeze in the secondary market, where banks sell off bundled batches of loans. Soon after the financial world went into crisis, prompting banks turn away anyone seeking a small business loan.

The Treasury Department and Small Business Administration (SBA) have been focusing on how to revive this secondary market since January 2009, but in the end, it looks like the market came back to life on its own by May when secondary market sales jumped to $324.6 million, staying in this range ever since.
For small business borrowers, a revitalized secondary market is a big step forward, but business owners looking for loans are still finding it difficult.

One way that small business owners of the future might profit is to stay away from loans altogether, and instead rely on a solid strategy of factoring their invoices. Also known as accounts receivable factoring, this age old business practice benefits businesses that do not get paid for 30 to 60 or 90 days by advancing up to 90 percent against invoices. IFG looks at the creditworthiness of the client’s customers and can fund within as little as 24 hours. IFG does not expect to buy 100 percent of a company’s receivables, and there are no minimum or maximum sales volume requirements.

Unemployement Jumps to 576,000

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Initial unemployment filings jumped unexpectedly to 576,000 in latest week, which is a continuing sign of weakness in the labor market. However, ironically, in the small business sector, which makes up more than half the total U.S. economy, is on the rise, according to the ISM Nonmanufacturing Index.

Common sense indicates that many people who have lost their jobs are seeking out ways to earn a living by starting their own small businesses, and some are even venturing into online Internet companies. The new term co-entrepreneur has surfaced, meaning jointly owned businesses by husbands and wives, or friends who share their views on opening a business as a partnership (versus independently).

With shared visions and complimentary skills, this new breed of small business owner is going beyond the traditional approach for enterprise. In short, the are open to new sills, tactics and methods to make it work and stay in business until these tough economic times are over.

Tactics used by co-entrepreneurs is staying fluid, watching trends, and using new strategies, such as factoring, all of which help them adjust as they grow — with the goal of building a sustainable business.

Accounts receivable factoring today allows start ups to ride the waves and stay afloat when customers pay later than expected. Invoices that are expected to be paid in 30 days may slip to 60 or 90 days, leaving business owners no money to buy supplies for their next job. Factoring is one way they can stay ahead of the curve.

To learn more about invoice factoring, go to www.ifgnetwork.com

SBA Loan Guarantee Programs Versus Factoring

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The Small Business Association (SBA) provides a number of financial assistance programs for small businesses. These include 7(a), 504 and disaster assistance loans, although the SBA does not provide grants to help people start a business, but they do offer training courses on financing a small business using the SBA’s loan guarantee programs.

Most traditional loans require time consuming processes, and many small business owners do not quality for them, whereas factoring is a highly effective alternative.

By selling credit-worthy invoices businesses acquire additional funding for immediate working capital. To learn more about invoice factoring, go to www.ifgnetwork.com

Small Business Contract Statistics

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On Friday, August 21, 2009 the government released its latest statistics on the volume of contracts awarded to small businesses and many were very disappointed to see that President Obama had not held up his campaign promises. Out of the top 100 recipients of federal small business contracts, 64 percent of the contract dollars went to large businesses.

On the other hand, the Small Business Administration press release (pdf) that accompanied this annual scorecard rating said that in fiscal year 2008, ? small businesses won a record $93.3 billion in federal prime contracts. They went on to mention that this was an increase of almost $10 billion from 2007.

The release also said small disadvantaged businesses, women-owned businesses and service-disabled veteran-owned businesses increased their share of federal contracting dollars by at least $1 billion to $3 billion.

Small business contracting did grow, but it appears that the federal government fell short of its goals. The goal was for the federal government award at least 23 percent of prime contract dollars to small firms, and within that figure, there are sub-goals for disadvantaged small businesses at around 5 percent, small firms owned by women at 5 percent and service-disabled veterans at 3 percent.

In 2008, nominal small-business contracts accounted for just 21.5 percent of all eligible contract dollars. Not only is that below the goal, it’s worse than in 2007, when small businesses received 22 percent of the dollars. The federal government as a whole hasn’t met this goal since 2005.

Clearly many small businesses have suffered since the economic downturn, and althought some are surviving by using techniques including invoice factoring, many have gone under.

Status of ARC Business Loans: Is Invoice Factoring a Better Solution?

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Since the Small Business Administration (SBA) launched the America’s Recovery Capital (ARC) small business loan program in last June, more than 1,000 emergency loans have been granted. The goal of the ARC program is to grant 10,000 loans by the time it ends in late 2010. Slow goes it for the banks, at this point, they are being careful about participating, with only 400 lenders currently making ARC loans. There are 8,200 FDIC-backed banks in the U.S.

Only three of the SBA’s 10 most active lenders this year — Wells Fargo, PNC Financial and Zions Bank –have issued ARC loans. The SBA data notes that Minnesota and Wisconsin have generated 28% of the ARC loans made to date. Alabama, Oregon and South Carolina, have fewer than five lenders offering ARC loans.

ARC provides interest-free (and insured) loans of up to $35,000 to approved business owners and is paying banks two percentage points over the prime rate. The SBA is forecasting a 56% default rate. Small, low-interest loans like these aren’t particularly profitable for banks, considering the time required to vet applications and manage the loans.

An alternative source for small business owners is invoice factoring. In fact, single invoice factoring (a.k.a. invoice discounting) is unique, simpler and superior to standard invoice factor services, factoring funding provided by traditional old line factors, accounts receivable financing, receivable funding and assets based lending approaches. By selling credit-worthy invoices to IFG, businesses acquire additional funding for immediate working capital.

Services provided by IFG allowed us to capitalize on significant growth opportunities over a short period of time; tripling our workforce and increasing our revenue 10 fold,?  said Carol Craig, President, Craig Technologies.

For more information on accounts receivable factoring, go to www.ifgnetwork.com