Helping your business to grow is more than just a matter of identifying and pursuing growth opportunities – you not only need a favorable market to expand into, you also need the capabilities to grow into the niche you have identified.
That means money, and even in a successful company it can be difficult to see where the funds can be found, so here are several of the options you may have overlooked, but which can help you to capitalize on your company’s strength to help raise the finance you need without exposing yourself to punitive interest rates.
Retail bonds let you attract investment by offering a promised return date and a set rate of interest, often with annual or biannual interest payments and a rate that accurately reflects the level of risk your company represents.
That might mean paying back up to 10% more than the investor puts into your company, but this may compare quite favorably with some of the alternative channels of lending open to you, and you should be using the money to grow, meaning your company will ideally be generating more than enough revenues to cover the interest payments, by the time they become due.
Factoring and Invoice Finance
If you have unpaid invoices that are owed to you, but waiting on the client to pay is causing you cash flow difficulties, invoice finance – often referred to as factoring – can help to make those funds available to spend on expansion projects.
You effectively ‘sell’ the invoice to an investor, who pays you its value in advance, and collects when the client settles the invoice later.
As always, there’s a cost involved, either in the form of an agreed fixed fee, or a percentage of the invoice amount, but it can be worth the sacrifice if you need access to the funds.
As strange as it may sound, those old debts owed to you that you thought you’d written off forever could be worth pursuing, and you can chase clients for payment on invoices that are even up to several years old.
You can also typically add statutory interest on to the amount owed – potentially turning even a modest sum into a substantial amount of money, especially on debts that have been owed to you for an extended period of time.
This is one way of making money and charging interest for the privilege, rather than having to pay to borrow against your invoices or issue retail bonds.
For the best balance between risk and funds raised, however, you might want to consider a combination of the three methods described above, along with any other avenues of financing that might be available to you, giving you the greatest possible sum of money to invest in expanding your business.
Services Your Business Should Be Utilizing To Save Money
A business can save money by learning about and implementing already preexisting services that help to make running a business operate more efficiently. These services will often lead to higher revenue and better customer experience.
These are always two factors a business owner should strive to improve. When customers are happy and revenue is coming through in higher volumes, this ultimately spells success for a business. Here are some services that will help a business save money and achieve more of that desired success.
A Call Center
One way to push for higher revenue is to improve marketing efforts by through offers to customers through a call center service. Whether a call service is actively reaching out to new customers or receiving calls from ads, the fact that customers get in touch with a live person will really help to sell what business is offering more effectively.
Since the call center has its own employees, this is going to save money by ensuring that your business will not need to keep people in a house full or part-time to perform this service.
App Development Services
Shopping around for a developer who can create an app for your business is the way to help your business enter the eCommerce realm. Potential customers love playing with online apps and they view this as a way to enhance their shopping experience.
Though developing an app may cost a bit of money up front, the lasting increases in revenue are generally well worth the expense.
If you have a lot of packages that need to be shipped, it is a huge waste of gas and time to hire an employee to run these boxes to a shipper. It is easier and cheaper to set up a regular pick up time with a major shipping operation.
This way, you never run into the problem of a lazy employee leaving in the company truck and not returning for hours on end on the company’s dime.
Virtual Office Services
A newer idea in modern business is the virtual office. Many business owners are finding that it is cost effective to only have an office when you actually need an office. Saving on rent, when you only need to be open two weeks out of a month can add up.
In addition, virtual offices provide a variety of extra services, such as security, in house secretary services and functional multimedia services. The virtual office provides a business with savings and flexibility that is hard to beat.
If you happen to be a company that is involved in having to process payments involving debt collection issues, then a merchant account through a quality payment processor is a must. As every business knows, more time spent being a business owner is always more cost effective than wasting time tracking down delinquent debtors. Consequently, it is best to have reliable credit card processing for debt collection.
Another way companies save money is by utilizing local storage facilities to hold the product. Initially, this move is an expense. But, in the case of a logistics mess, having materials and products nearby will ultimately prevent massive revenue losses from being a problem.
In addition, a storage facility is a great idea for when a store needs to move locations to improve foot traffic or expand to increase revenue even more. Consequently, there are many situations where the overall savings outpace the initial expense of utilizing such storage services.
A business is more than simply a building that peddles a particular range of products and services. In today’s business world, businesses are a symbiotic aggregate of many businesses to business relationships, all working together, which creates a functional whole.
When every part of a business and the services it relies on to make it all happen works out, the savings are excellent and the operational efficiency is superb as well. This is why it is always smart to consider what kind of services will enhance how your business operates.
Why Lenders Dislike Commercial Mortgages For Companies?
The vast majority of Buy to Let products are only available for private individuals. Why is that the case? What is wrong with lending to a private limited company with security by way of a mortgage against the property in question?
Create a Limited Company for your Property Portfolio
There are many reasons why creating a private limited company would be advantageous when buying Property. Probably the most important is that it would allow groups of investors to have a simple vehicle to hold the Property.
Each Investor would have a share of the Company reflecting their investment. That share can subject to the agreement be transferred to 3rd parties. It would be particularly useful for families or business partners.
One reason often cited for not buying a property through a company is that it has tax disadvantages. This is because the income received by the Company is taxed and then when it is paid out to the shareholders they are taxed on the dividend. That, however, is not a matter that would bother a lender and is not the reason why they do not like to lend to Companies.
It is worth noting that if you are buying a Property as an Investment with others there can be tax advantages in using a Company from a practical point of view. If you buy a property as a group of Individuals each person must put in an account of the value of their share of income and liabilities on their personal return. That might not suit a lot of people.
Many Property Investors are not looking for immediate income from their investment. They might be much happier having all income and liabilities in the Company and tax if any being paid by the Company and in the initial stages taking no monies from the Company. That way they do not have to declare it in their personal tax return.
It’s Not You the Banks Don’t Like, It’s the Paperwork
The reasons why Lenders do not like lending to Companies are nothing to do with tax for the Borrower. Instead, they relate to the extra complexity required in the process of deciding to grant a commercial mortgage.
Firstly the Company has limited liability so if there is a default on the Mortgage the only security is the Property and any extra assets the Company may have. The individual shareholders are not personally liable.
Then there is the need to have security not just on the Property but also on the Company as a Company. That is called a Debenture and is a complex legal document.
Whilst that security is not essential by not having it the Bank is slightly reducing its liability and so cannot say it has covered every base. That is something Banks do not like to do. They want maximum security in most cases.
Finally because of the more complex nature of dealing with a Company the level of legal expertise required will be greater. For a normal mortgage Banks are happy to have the same Solicitor for the Borrower act for them as well.
However, for a Commercial Mortgage, the Banks often feel it is safer to appoint their own Solicitor as well as the Borrower’s Solicitor because they perceive the transaction as more complex and so needing greater legal oversight.
That this policy by Lenders is wrong and unfair to Buyers who want to use a Company vehicle to get a Commercial Mortgage. The Lenders should be able to rely on their valuations to confirm they are getting adequate security.
They have the same security over the property by virtue of their first charge whether it is a Company or Individual… They have the same rights to enforce the charge. So they should not in our view discriminate against Company Purchasers.
Choosing The Best Business For Sale in Florida
Setting up a private business and owing it is a pride and superiority eminence in the society of today. To be successful in business it’s very important to have a unique selling idea and the inevitable need for the service or product.
Being one’s own boss is any time preferred over working under someone else and taking orders and binding according to their needs. There are a lot of consultancies that help in buying and selling a licensed business which makes the effort of an entrepreneur easy-going.
To start a business it’s required to have proper planning, about the place, kind of industry and setups required. Florida is a nice place to make business as it’s surrounded by Ocean. Business for sale Florida is a good investment idea and strategy for an entrepreneur.
A person who is looking for offshore investment, it’s a nice prospect to invest in Florida. There is a minimum investment required because it’s not required to buy a building as there are leasing options available. The only thing required is the setup for the plan. By this, it would help in developing and have an offshore real estate value.
Setting up a business:
Proper strategy and approach is key to the success of the business. It’s a huge responsibility to build a successful empire and run it for decades. Accurate market analysis has to be done and financial investment has to be planned.
There are ventures which help an entrepreneur to raise fund if the idea is truly virtuous. It is required to do background work about the sector, the equipment’s required, human resources, etc. Most importantly it’s essential to have contacts and also build contacts.
Business for sale Florida is an amusing setup plan. There is a lot of existing businesses accessible for buying out with good negotiations and required specialized businesses. With time it’s required to bring changes in the culture and the processes of the business as ‘change is the only thing, which is constant’.
There are different kinds of business like a sole trader, Partnership or joint venture. Based on the limit of the risk a person is prepared to bear one would set up a business. The business can be brought as an additional acquisition to the existing or it can be as a new startup.
Selling a business:
A well-built and well-doing business can be winded up for several reasons. It becomes important to hand over the business into the right hands to develop it and make it progress able and recognizable.
At the time of sales, the profile of the business has to be done flashy and ostentatious in such a way that it attracts the person who is planning to invest in a similar kind of business.
Not necessarily only a well-doing business is sold; even a company under loss is also sold. For business for sale Florida to be sold out it’s important to communicate accurate revenue being generated through the business and converts the strategies and policies approached.
To do business it’s required to make a huge investment and to be prepared for the forthcoming risk. The accomplishment of a business depends on the consumer’s affordability and demand. Florida is one such place where there are multiple options to do business and prosper.
Read also: Is Entrepreneurship Really Meant For You?