Finding A Business Loan In Florida

Before starting up any venture or looking at growth opportunities, the owners are more than often confronted with issues regarding the financial capabilities of the firm. The answers to the question are rather limited. One can either use up the firm’s retained profits or borrow from external parties. The absence of the requisite funds by means of retained profits is a normal scenario especially for growing firms which eat up more than they produce. Obtaining funds by way of loans is then the only solution.

Business loans are available for various projects and on various conditions in Florida. There are certain prerequisites (as in every country or state) that must be obliged to, to make funds available. In other words to take up a loan you must prove your worth by way of depositing collaterals, personal guarantees and / or any other means of security as an enabler of loan.

The business loans offered in Florida include special project loans for small businesses and minority groups among the other regular financing schemes. Amid the various loan programs offered in Florida, the key ones are enumerated:

1. Enterprise bond programs: A state initiative that offers low interest, tax exempt bonds. The program is catered to manufacturing and non profit organizations

2. U.S. Small Business Administration (SBA) programs administered for smaller businesses. Include Basic 7(a) Business Loan Program, provided by lenders on guaranty basis, Micro-Loan Program for startup and growth and CDC/504 Loan Program as a long term financing tool for economic development. CDC/504 caters to financing for fixed assets.

3. U.S. Dept of Agriculture-Rural & Unincorporated Areas provides financial aid for public utilities and agricultural initiatives.

4. U.S. Dept of Commerce-Economic Development Administration caters to areas of economic development.

5. Financing destinations for international trade loans and grants: Includes two key lenders namely Florida Export Finance Corporation (FEFC) and The Export-Import Bank. Former is loaded with the responsibility of expanding employment opportunities by way of increasing export business, while the later is an independent US government agency also looking into employment creation arena.

6. Front Porch Micro credit Loan Program: Aimed to increase access to small minority businesses. Maximum limit available for loans is $ 15000

7. Florida Black Business Investment Board – Franchise Finance and Development Program (FFDP): Extends loans to franchisee businesses that are at least 51 % controlled by an ethnic minority

8. Minority Business Development Agency (MBDA): The only federal agency established for the purposes of helping minority businesses to grow by way of extending business development services.

9. Florida State Programs – Office of Supplier Diversity: Caters to women owned and minority owned businesses.

Additionally Florida Dept of Community Affairs – Division of Housing and Community Development offers programs to improve the housing facilities and other development projects like projects that promote job creation for low and moderate income groups.

Outsourcing HR For Small Businesses

Small business owners who want to concentrate in establishing and building their business usually save time and worry as well as money by outsourcing the management of their human resources. Some HR tasks that can be easily outsourced are recruiting, hiring, training etc. it is necessary to carefully consider it, if it will be cost effective, time conserving and if your business can afford to outsource HR. If you decide that outsourcing the HR is the best alternative to having an in house HR department, care should be taken in hiring the right HR firm that suits your business needs.

Things to Consider While Choosing a HR Outsourcing Firm:

1. The type and the range of services it offers.

2. The cost of the services.

3. Its expertise in your area of business.

4. The accessibility of resources.

5. Make sure the firm understands your business and your target goals; it will help them serve you better if they know about you.

HR outsourcing for small businesses used to involve just a few areas such as recruitment. However, these days, businesses hire experienced HR firms that handle the businesses entire HR needs. This is because of the firms are experienced and will handle the businesses needs better and at a lower cost than if an in house HR team were to be hired. With an in house HR department, the disadvantage will be that they will need constant monitoring too where as competition will make the hired HR firm perform well in any situation.

Small businesses can search on the Internet to find an appropriate HR firm that specializes in their kind of business and situated in their area. This gives these small businesses time to focus on building their business and yet manage to manage good HR policies. The quality of the work of the Hr firm has to be consistent and the small businesses have to get value for money from their services.

The popularity of HR outsourcing firms for small businesses have created a demand for specialized firms that deal in one specific area of HR or some firms that deal in all areas of HR and have become the one stop shop for the entire HR needs of particular businesses. This has cut the operating costs of businesses significantly making it a worthy investment for many small businesses. The firms take care of recruiting, staffing, training, benefits, pension plans, performance management and payroll administration etc. One other popular area of HR outsourcing is the popular call centers set up in far away countries where labor is cheap and the job is done at a fraction of the cost. There are different areas of HR that firms specialize in and makes the task of running a business far easier than ever thought possible.

There are firms that offer services and products to help run a successful business.

The Difference Between Debt And Equity Financing

There are two main types of financing for a business, debt or equity financing. Debt financing tends to be the type of financing you receive from a traditional bank loan and equity financing tends to be financing you receive from venture capital into your business from outside investors. The benefit of debt financing is that it is finite and you will pay down the debt over time to a zero sum balance without any further obligation to the lender. The down stroke to debt financing is that traditional lenders will take a hard look at your business including how long it has been in existence, income from operation, expenses and will require hard assets for collateral for the loan. Additionally, lenders will most certainly want you (and any other principals of the organization) to personally guarantee repayments of the loan. Another disadvantage of debt financing is that your organization will be burdened with some other type of regular payment (usually a monthly payment) depending on the terms and conditions of the financing and this can absorb critical cash flow, especially with small business.

The benefit of equity financing or venture capital is that you will be receiving money in exchange for equity in your business in the form of stock or some other form of equity like percentage of income or gross/net sales. A primary benefit of this type of financing is that typically there is no monthly payment requirement to investors. Instead, you are giving up ownership interest, most often, permanently.

Traditional lenders, banks for example, will look at your business much differently than venture capitalist. Bankers want a zero-risk or near-zero risk position when they provide financing and will rely almost completely on the operating economics of the business with little regard for “potential future growth”. They want to see strong cash flow backed up by hard assets before they do a deal–the ingredients that most small business lack or they wouldn’t be seeking financing, right? Venture capitalist, on the other hand, tend to consider the management team and the potential future growth of the business more heavily than actual operating numbers, especially for small business with large potential but few sales and little or no operating history. Although these two lender types vary in their approach to analyzing a business for funding, you can be sure that careful scrutiny of you business will be conducted…

Besides the actual operating economics and pro forma analysis, both types of lenders will look closely at two particular documents: 1. Your business plan. 2. Your bank or loan request package. These two documents, if assembled correctly, can make the difference between success and failure when dealing with either lender type.

There are plenty of free SBA related materials that tell you how to create blue-chip, boiler plate business plans but they tend to be written for perfect businesses and not the average Joe who is less than picture perfect. If you are seeking some type of financing for your business I strongly suggest that you visit our site and check out our business e-books. We have several that cover a variety of topics and there are specifically two that will be a real treasure for you to own. One is called Power Planning (a powerful report on writing a wide variety of business plans) and How To Raise Money For You Business (teaches you how to assemble professional loan requests packages). They are priced at $5 each and can be worth millions in the hands of the right person. I am not trying to hype product, I am simply giving you a heads up.

The secrets to getting financing from either type of lender is a closely held secret by financial and business brokers for a number of reasons. Chief among them is it forces people like you to do business with them and they earn commissions. The SBA materials, while good, do not have the street savvy to get the job done in most cases. The proof is in the pudding–what has the SBA ever done for you? The SBA is just another government back bureaucratic nightmare for most. We also have some links for venture capital firms in our business links area located on our site on the Smart Link Zone page–it’s all-free.

Give it some thought…. Your future may depend on it.

To your success! Copyright © 2006 James W. Hart, IV All Rights reserved