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Skipping Over Financial Start-Up Maze in College

By Lyle Johnson

College is a time for education, inspiration and maybe a bit of partying. It’s also one of the prime times of your life to consider starting a business, as many students don’t have a great deal of financial responsibilities, either from parents footing the bill, or taking out loans. Sure, you’ll have to pay those loans back after you’re out of school.

At the same time, you don’t have the pressure and burden of finding a part-time job that can work around school hours to pay your bills. You’ll simply have time to create a business that might make you independently wealthy while you’re still studying. According to Small Biz Trends, the average amount of business financing given to new upstarts was $325,000. Avoid these financial pitfalls to set you on the right path to hitting it big, and make the best use of your financing.

Why Make a College Startup

Outside of the lessened responsibilities that typically come with being a college student, the real world experience you gain by starting a business is invaluable. If you’re worried about getting stuck in the need-experience-to-get-a-job, need-a-job-to-get-experience trap after graduating, running your own business can fill that gap. Even if you don’t make the next big company, you can at least get some supplemental income to start paying your student loans back early, or eat something other than ramen.

Financing Your Business With Personal Assets

While you might not have many personal assets as a college student, you will probably have to leverage your savings and any property to finance a new startup. It takes time to secure small business financing, especially as a student with few assets. Crowdsourced financing may help tap into your network to back a great idea. Small Business Administration loans and sites such as annuity.org may provide financing options that leverage other resources that may be available to you, which are some of the easier routes, as opposed to seeking out individual investors.

Create a Budget

You have to spend a lot of cash to get your business off the ground, especially if you’re dealing with physical inventory and locations. Create a strict business budget, and don’t be tempted to spend money on non-business expenses. Once you’re making a profit, you can indulge a bit, but not before you reach that point.

Pay Yourself

Once you have reached that magical point of getting out of the red with your business, the SBA recommends you pay yourself some sort of salary. That makes your business feel like a real, proper job, and it also gives you money separate from your business, so you don’t feel bad about spending it. It might take some time, even years, to get your business profitable, but every step of the way is valuable experience.

About the author: Lyle Johnson runs a small roofing business and studies marketing at his local community college. He writes about small business, marketing and how to leverage social media.

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Big storm is big business for small companies

Hurricane Irene could be big business for small firms

AdvantaClean crews get ready for the arrival of Hurricane Irene. If the storm hits hard, the business could see a couple million dollars worth of business.

NEW YORK (CNNMoney) — While some business owners are fretting over the damage Hurricane Irene could cause, others are gearing up for business opportunities.

Depending on the severity of the storm, AdvantaClean, a North Carolina disaster cleanup company, could see a couple million dollars worth of business in the storm’s aftermath.

hurricane-cake2.jpgA gourmet bakery in Massachusetts is giving away free Hurri-cakes, in hopes of attracting more customers.

“Certainly, our industry does see an increase in demand during these times,” said Jeff Dudan, CEO and founder of AdvantaClean, headquartered in Huntersville, N.C. “Typically our volume will go up both at home, and we can get some incremental volume and revenues in those areas if we are called in to respond.”

In addition to being AdvantaClean’s founder, Dudan owns one of the franchises and has 13 full-time employees and 26 contractors. The company provides cleanup services including air duct cleaning, mold removal, and emergency services from water or fire damages, which means responding to disasters.

10 great franchise bets

The 17-year-old company’s bottom line got a big boost after Hurricane Katrina hit in 2005. Dudan’s team responded in Gulfport and Biloxi, Miss., and in the French Quarter of New Orleans. In the immediate emergency response period, Dudan said his company did a couple million dollars worth of work after the storm. And AdvantaClean made more money working large projects in the region for another four years.

The company has been preparing for Hurricane Irene. “We have checked all of our vehicles and made sure that they are fueled,” said Dudan. “We ended up pulling the trigger on several sets of new tires.” In addition, the team has reviewed its emergency response plan.

Still, they are not rushing in. “Personally, we just don’t go running off immediately if it looks like a hurricane may or may not hit,” said Dudan. “It is really difficult to predict whether there will be any real damage.”

Let them eat cake: Whether Irene lands with a whomp or a whimper, at least one company is prepared to make a buck.

Cakes for Occasions, a gourmet bakery in Danvers, Mass., is running a competition on its Facebook page, asking fans to predict what category the National Weather Department will call the storm on Monday. One person who guesses correctly will be randomly selected and get a coupon for 20 percent off.

Also Cakes for Occasions is giving away free “Hurri-cakes”: two-inch chocolate mousse cakes, glazed with chocolate and decorated with the national hurricane symbol and the name of the storm, Irene.

The idea behind the promotion is that customers can’t come into a bakery without being tempted by the smells, said owner Kelly Delaney. In addition to its single storefront, the bakery has a website, Cakes4Occasions.com.

“It always generates some additional sales,” said Delaney, who has run freebie promotions on Facebook before. “You will have a handful of people that will come in for just one, but that is just life.” Delaney has made 210 Hurri-cakes and estimates she will give away 40. Then she hopes to sell the rest, which retail for $1.95 each.

A banner year: It has already been a good year financially for Howard Altschule, who owns Forensic Weather Consultants, a company that provides weather damage reports. Altschule saw more business after last year’s blizzards. And if Irene lives up to expectations, 2011 could turn out to be a banner year for his company.

“I have already seen a 50% increase in revenues this year, without the hurricane,” said Altschule. “It could end up being a 100% revenue jump this year. It all depends on what exactly happens and to what extent.”

Altschule, a certified meteorologist who analyzes weather conditions, provides expertise to insurance companies, law firms, engineers and other companies.

Altschule said he would not be surprised to see a billion dollars worth of damage from Hurricane Irene, between the damage and the loss of revenue. He expects to be “immensely busy.”

Hiring: Yes. No. Maybe so.

Surf’s up: There won’t be throngs of beachgoers this weekend, but some diehard surfers are expected to catch the waves.

“This is something that surfers wait for, the waves that hurricanes bring,” said Johannah Sena, the manager of the family-operated Rockaway Beach Surf Shop in New York. “You have to have a board that is a more high-performing board.”

Still, most expert surfers — the ones most likely to try surfing during a hurricane — already have the gear necessary to ride those enormous waves.

So she doesn’t expect to be selling out of boards.

But, “we will be selling a lot of wax, that is for sure,” said Sena, explaining that surfers use wax to add traction to their boards. Otherwise, the storm won’t be good business for the Rockaway Beach Surf Shop. “Nobody is going to the beach to buy a bathing suit, towels, that kind of stuff,” she said.  To top of page

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Help for social media mayhem

Holy crap! Someone used social media to trash your company.  Social media monitoring tools can minimize the damage.

Holy crap! Someone used social media to trash your company. Social media monitoring tools can minimize the damage.

NEW YORK (CNNMoney) — It wasn’t until a man diagnosed with measles ate at her New Jersey diner that Connie Correia Fisher, co-owner of The Pop Shop, discovered that the only thing that spreads faster than an infectious disease is bad news.

“We had every major TV station here. All the papers were here, and people were freaking out,” said Fisher, who co-owns The Pop Shop with husband and professional actor Stink Fisher. But that’s not all. Within no time, parents and restaurant regulars alike had taken to the Internet, voicing their health concerns on public platforms like Twitter and Facebook.

But while Fisher couldn’t stop the television crews from hanging outside her six-year-old restaurant, she was able to “constantly beat back down” the fear-mongering flooding social media channels, thereby saving her company “thousands of dollars” in lost business. That’s because Fisher subscribes to Sprout Social, a social media monitoring tool that, for $50 a month, helps her keep tabs on every single online conversation mentioning The Pop Shop.

Welcome to the world of social media where 140 characters can cause irreparable damage to your company’s reputation — and bottom line — in seconds flat. Blogs, Facebook, Twitter, LinkedIn — each one is a digital grapevine, letting consumers air their grievances to millions with the single click of a mouse.

10 great franchise bets

When someone posted a video on YouTube of rats running around a New York City Taco Bell restaurant in February of 2007, the video spread across the web like wildfire, causing Taco Bell’s (YUM, Fortune 500) stock price and sales to drop, and prompting duplicate videos with more than two million views to date.

And then there was the catastrophic BP oil spill in early 2010. Despite thousands of tweets from angry citizens being published within hours of the Gulf of Mexico disaster, it took the oil giant seven days to issue a Twitter response.

Despite these social networking snafus, multinational corporations can more easily rebound from an onslaught of unflattering tweets and derisive Facebook updates than a resource-strapped small business.

“Large enterprises spend a lot of money on public relations so they can throw an entire army at the problem,” said Tim Hickernell, an analyst with Info-Tech Research Group. “But a small business owner doesn’t have that army. He has to take the time to manage his company’s reputation.”

No wonder then that a growing number of small businesses like The Pop Shop are turning to social media tracking technologies such as those offered by Sprout Social, Radian6 (recently acquired by Salesforce.com (CRM)), HootSuite, Twitter Advanced Search, and Sysomos.

These modern-day eavesdropping tools scour the conversations taking place on social networks for relevant comments — and damning criticism, enabling companies to respond in real-time to online opinions. In fact, according to a Forrester survey, of the 301 customer intelligence professionals canvassed, 78 percent responded that they actively monitor what customers are saying online.

Take, Blue Sky Factory, for example. When a customer tweeted a complaint to his 50,000 followers about the Baltimore company’s customer service, Radian6 immediately caught the criticism and alerted Blue Sky Factory’s 23-person agency via email. Within minutes, a Blue Sky Factory customer service representative responded directly to the tweet with a very public apology. It was a critical intercept given that 22 percent of Blue Sky Factory’s business hails from social media channels. In fact, the company sees close to 1,000 mentions a month.

8 cities that want your business!

Stephan Howard wasn’t so lucky. Instead of using a social media monitoring tool, Howard, the owner of Flik and Company, a Toronto interior design firm, learned from customers that his business was being trashed in a local community blog. ‘Have you been ‘Flick’d’ Over?’ read the thread initiated by a disgruntled Flik customer, who claims Flik failed to make good on a down payment for furniture until he took his ordeal to the blogosphere. (Howard denies the allegations).

In no time, the blog became ablaze with name-calling, finger-pointing and commentary from scores of customers. That is, until Howard contacted the local police department, which ordered the blog’s administrator to terminate the thread.

“It really did get ugly,” said Howard, who has since moved out of the neighborhood and relaunched his store under the banner Flik by Design. “I was bothered a lot by what happened, I was sick to my stomach, and there were nights when I didn’t sleep.”

Social media monitoring products can help. However, selecting the right one for your business requires sifting through “hundreds of tools from free services to million-dollar-plus technologies,” said Zach Hofer-Shall, a Forrester Research analyst. These products range from Web-based dashboards that aggregate social media data to sophisticated analytics tools that mine data and generate custom reports.

For cash-strapped small businesses, free tools such as Google Alerts and Twitter Advanced Search let users conduct keyword searches for the names of their companies and competitors, but have “very limited functionality,” warned Hofer-Shall.

That suits Parties That Cook just fine. The San Francisco corporate team-building and cooking class company relies on Google Alerts to flag mentions on user review sites like Yelp. “In a small company with limited resources, it just doesn’t make sense to spend the extra money or extra time [on a costly social media monitoring tool],” said Crissy Gershey, Parties That Cook’s marketing director.

Nevertheless, the $5.99 a month it costs for HootSuite’s basic analytics solution, or $500 a month for Sysomos’ more robust Heartbeat solution, can be a worthwhile investment. By upgrading from Google Alerts to Radian6, DJ Waldow, Blue Sky Factory’s director of community, said he spends nearly three times less sifting through company mentions, and no longer worries about angry tweets or Facebook comments “slipping through the cracks.”  To top of page

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BP oil spill fund: $5 billion in claims paid out

BP's $20 billion oil spill claims fund: $5 billion paid

The BP oil spill fund for the Gulf of Mexico has paid out $5 billion of $20 billion set aside for recovery, claims administrator Kenneth Feinberg says.

NEW YORK (CNNMoney) — The fund to compensate Gulf Coast businesses and residents for damages from last year’s BP oil spill says it has paid out $5 billion of the $20 billion set aside for recovery.

The Gulf Coast Claims Facility, which took over the claims process from BP (BP) in August 2010, has approved 38% of the 947,892 claims submitted, according to an executive summary it released Tuesday.

The fund, which has employed as many as 3,000 people, has received claims from all 50 states and 36 countries.

The vast majority of the claims paid have gone to five states. Florida residents and businesses have been paid $2 billion, more than any other state. Louisiana recipients have been paid $1.5 billion. Recipients from Alabama, Mississippi and Texas round out the top five, respectively.

The historic environmental disaster was the worst oil spill in U.S. history, claiming 11 lives and spewing over 200 million gallons of oil into the Gulf.

The spill had wide-ranging economic consequences in the region. Businesses such as fishing, oyster harvesting and charter fishing boats, were impacted directly by oil in the water. Restaurants, hotels and rental properties that depend on tourism money saw a drop-off in sales, even in cases where there was no oil visible on the beaches.

“It is interesting to point out the different nature of the claims coming from Florida, largely tourism, as opposed to Louisiana, largely commercial fishing,” said Kenneth Feinberg, the head of the fund and the former administrator of the 9/11 Victims Compensation Fund.

As the leader of the fund, Feinberg has taken heat from both BP for being too generous in his payments and from the government for being too stingy in his payouts.

One year after the BP spill, this family business is still reeling

Many of the claimants who were denied payouts say the process was unfair. The U.S. Coast Guard, which has reviewed more than 1,000 claims from unhappy claimants, has sided with Feinberg’s decisions.

Also, for the sake of full transparency, the fund has agreed to be independently audited by the U.S. attorney general by the end of the year, according to the executive summary.

The Gulf Coast Claims Facility will continue to process claims until August of 2013.  To top of page

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Frederick James creates iPad covers from Madoff clothes

Crime pays: Frederick James' iPad covers made from Madoff's old clothes are selling like crazy.

Crime pays: Frederick James’ iPad covers made from Madoff’s old clothes are selling like crazy.

NEW YORK (CNNMoney) — If you’ve ever dreamed of turning the tables and taking Bernie Madoff to the cleaners, here’s your chance. John Vaccaro, a New York entrepreneur, is selling iPad covers made from the disgraced financier’s tailored clothes.

Madoff was sentenced to 150 years in prison in June, 2009 for swindling billions of dollars from clients in what has been called the largest Ponzi scheme in U.S. history.

Last November, his clothes and personal possessions were sold at auction sponsored by the U.S. Marshals Service with proceeds going to help those who lost money from his scheme.

One of the bidders at the auction was Vaccaro, 41, who had just launched a new company, frederickjames.com selling eco-friendly customized iPad covers made from cashmere and other fine fabrics. Vaccaro first conceived the idea for his unique covers after purchasing an iPad and searching for a cover that would prove to be both scratch-resistant and fashionable.

Inside Madoff’s Manhattan penthouse

“There was nothing on the market at the time,” said Vaccaro. “When a friend came over one day and left their cashmere sweater lying next to my iPad, I realized that material would make a perfect cover.”

Vaccaro sought the advice of his friend, fashion designer Stephanie Doucette to learn how to transform vintage fabrics and remnants into iPad covers. When he saw an ad for cashmere sweaters being sold at the Madoff auction, he decided he could expand his line while helping Madoff victims.

At the auction, Vaccaro bought Madoff’s cashmere sweaters, as well as 16 pairs of designer pants, and hired a designer to turn the clothing into iPad covers. Vaccaro immediately sold five iPad covers made from Madoff’s former cashmere sweaters to a Wall Street attorney who gave them out as Christmas gifts.

“For some people in the finance world, these covers, made from Madoff castoffs, represent bragging rights,” said Vaccaro. “For others, it’s a chance to own a piece of history.”

Now Vaccaro is focusing on selling one-of-a-kind iPad covers made from Madoff’s Banana Republic chinos and Murphy Nye sailcloth pants for between $250 and $500, while providing buyers with a certificate of authenticity, and a receipt from the auction.

He estimates that he has enough fabric to sell a limited collection of 31 Madoff-themed covers. Once he breaks even with his auction purchase, he hopes to donate a portion of the proceeds to Madoff victims.

After the Madoff collection is sold, Vaccaro plans to continue focusing on selling other customized lightweight protective iPad covers made from rescued and remnant luxury fabrics. Some of his current collections include “The Lodge,” inspired by hunting and skiing material, “The Office” made from wool and silk and featuring classic pinstripes, and “The Island” using rayon and polyester crepe fabrics lined with double-knit wool.

Celebrities’ secret businesses

As he builds his Frederick James brand, Vaccaro continues to oversee his web design and development company, juicyorange.com that he co-owns with designer Mark Robohm. While he would consider purchasing clothes from other famous or infamous people, he concedes it would have to be a good match.

“If I were to buy some of Marilyn Monroe’s former clothing and turn it into iPad covers, it would only serve to devalue the items,” Vaccaro said. “In the case of Bernie Madoff, people were pleased to see his designer clothing cut up in shreds.”  To top of page

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Sales pro finds dogs make better clients

second act

Lesley Bowers, 62, Lewes, Del.
Then: Radio station ad sales manager.
Now: Owner of a pet accessories store.

(MONEY Magazine) — When the industry she knew started going to the dogs, Lesley Bowers decided to follow suit. After 20 lucrative years in radio sales — at her peak, she doubled her $100,000 salary with a bonus –she began tiring of the pressure. “It was becoming too bottom-line driven,” she says.

After deciding to quit, the devoted dog owner began tossing around the idea of a pet accessory boutique. Setting an example for a college finance class she was teaching at Howard University in 2004, Bowers wrote up a business plan.

A year later she opened P.U.P.S. (“Pawsitively Unique Pet Shop”) of Lewes, which carries everything from organic treats to NFL team collars.

This year she expects sales of $250,000 and will take a salary for the first time — about $20,000. It’s been a big shift, but Bowers wasn’t unprepared: “I’d never opened a store,” she jokes, “but I had changed formats in radio.”

1. By minimizing her investment.

Starting out with a tiny 250-square-foot space — and rent of $650 a month –Bowers took just $10,000 from savings for inventory and overhead. Her husband, Sam, a TV ad salesman turned carpenter, handled renovations.

2. By keeping her second job.

Bowers still teaches at Howard, taking in $36,000 a year. With their house paid for and her stepchildren grown, that income plus Sam’s carpentry earnings covers the couple’s expenses, allowing her to reinvest most of her earnings.

3. By marketing creatively.

Bowers devised inexpensive attention-getting events. Among them: an annual BarkFest (including a pet pageant), a Yappy Hour (complete with Mutt-inis), and even a dog reenactment of the royal wedding (the town mayor officiated).

Send The Help Desk questions.  To top of page

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Need a job? Forget benefits

Small business hire part-time workers

Jo Heinz (R) owns a Dallas-based commerical architectural firm. The increasing costs of benefits — particularly health care — come out of her small firm’s bottom line.

NEW YORK (CNNMoney.com) — Providing benefits to full-time employees is an increasingly unattractive option for small businesses. As a result, they are hiring part-timers.

“Everyone’s focus right now is controlling cost,” said Jo Heinz, owner of Staffelbach, a Dallas-based commercial architecture firm. Contractors and part-timers “are going to get the nod before the individuals who are looking for the full package,” she said.

Thanks to the stubbornly high unemployment rate, there are plenty of workers willing to take a job without benefits.

“There are a lot of available people that can help you in whatever things you might need, even as a small business,” said Maria C. Coyne, executive vice president of the business banking at KeyBank. “More often, we are seeing people using part-time help or even contract help.”

Hiring: Yes. No. Maybe so.

Heinz employs 71 people and about 80% of them are full-timers with benefits. She provides an extensive package including retirement benefits, health insurance, and wellness programs.

Her part-timers have a shot at getting benefits if they “do well — do exceptionally well,” said Heinz.

Benefits are expensive. Depending on the employee’s level and salary, a benefit package can cost between 20% and 28% on top of the base salary, said Heinz.

Job seekers “are going to have to understand that if they are demanding those benefits, their attractiveness in the job market is not as great,” said Heinz.

Skyrocketing health care costs: Health care costs are the most expensive portion of Heinz’s benefits package. She has seen 12% to 15% annual increases for the last four years. Every year, she shops around for more affordable employee benefits starting months in advance.

She is not alone.

“Oh my God, my health care benefits have gone up 1,000% in 10 years,” said Liz Parker, who owns The Tulsa Rib Company with her husband, Steve, in Orange, Calif. The couple runs a catering operation and a single-storefront restaurant. “We are really Main Street, small business America.”

The shop — known for its barbecue — has 35 regular employees. The Parkers provide health care and other benefits for their 14 full-timers.

On top of health care, Parker also has to pay taxes and retirement benefits for each full-time employee. “Every time we hire an employee that is full-time, whatever salary we give them, we attach 35% to the cost as an employer.”

Recently, Parker lost a long-time, full-time employee. “We are not quick to pull the trigger to replace him,” said Parker. She spread his hours out between existing employees who could take additional hours.

10 great franchise bets

“Most businesses want to provide health care,” said John Arensmeyer, CEO of the Small Business Majority, a nonprofit small business advocacy organization. However, many have to find a way to work around surging costs. “When it becomes too cost prohibitive, they will either drop coverage all together or increase the percent that the employee has to pay for the coverage,” said Arensmeyer.

The Obama administration passed comprehensive health care reform last year intended to stem the surging costs of health care. The reform won’t be completely implemented until 2014. But there are tax credits available now to help the smallest small businesses cover the cost of health insurance.

You get what you pay for: Offsetting costly benefits is employee loyalty, said business owners.

“I walked in Thursday night at midnight and my warehouse manager and my floral designer were still there working for events that they had on Friday. Not once did they complain,” said Maxine Turner, co-owner of Cuisine Unlimited, a catering and special event planning company based in Salt Lake City. “You get loyalty and that means a lot.”

Turner has 80 employees and of those, 60 are full time. A chef making a base salary of $55,000 costs Turner $13,800 a year in benefits, including health insurance, retirement and personal time off.

Cuisine Unlimited has tried having two part-timers sharing the reception desk duties. But one full-timer “took more ownership of her job” and has turned out to be more productive than two part-timers, observed Turner.  To top of page

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Main Street on edge as Wall Street swings

Small business owners on edge as Wall Street swings

The Sundance Bookstore (L) in Reno, Nev., sees customers buying less, because the volatility on Wall Street (R) makes them jumpy.

NEW YORK (CNNMoney) — The nerve-racking volatility of the stock market has been making small business owners, well, nervous.

The market has been down 600 points, up 400, down 500 and up again 400. The chaos has translated into smaller sales for small business owners as consumers curb their buying.

The impact of the market’s wild swings on mom and pop businesses is not so easily seen, because they are not publicly traded. But there is an impact and not necessarily a good one.

“When things are getting dicey or tough, we feel things pretty immediately,” said Christine Kelly, owner of the independent Sundance Bookstore in Reno, Nev. Books are not a necessity, so when consumers are looking for places to trim their budgets, they buy fewer books, she explained.

The drawn out debate over the debt ceiling, as well as Standard Poor’s recent and unprecedented downgrade of U.S. debt also has eroded consumer confidence.

Hiring: Yes. No. Maybe so.

“When you see people concerned about investing or concerned about their faith in the American government to get things in line, I think people save,” said Kelly. It doesn’t take long for customers to shut their wallets after getting spooked. “This stuff is immediate,” she said.

Smaller jobs: A tumultuous stock market also affects real estate and the small companies in that sector.

“A lot of times if somebody is moving into this area thinking about building a new home, nine times out of 10 they have the majority of their money invested in the stock market,” said Ronnie Potter, co-owner of construction company, Potter Sunderland Construction in Louisville, Tenn. “And if it goes down for a few weeks, they could lose 25% or 30% of the money they were planning on using to build a new home, so it is a very direct effect.”

Potter’s firm started in 1993, and he used to do mostly custom homes. Now, his business is primarily renovations and remodel jobs because consumers don’t have as much money to spend.

“You do whatever you have to do to keep the company alive,” said Potter.

Patience is a virtue: Wayne Spivak isn’t worried about losing clients. But the swings in the market mean he may have to work harder to win new ones.

“A lot of small businesses are hesitant to make what they deem to be a bold move, because they don’t know what is happening,” said Spivak. “That volatility is driving everybody crazy.”

Spivak’s clients are small businesses with between $1 million and $175 million worth of revenue. He started SBA * Consulting in 1990, which now has six offices with a staff of two full-timers and 45 independent contractors. SBA * Consulting provides part-time chief financial officer services to small businesses that can’t afford a full-time CFO.

“They need a CFO, but they can’t afford somebody five days a week, so we go in one day a week, two days a week,” said Spivak. His sales team might have to make more visits to a potential client and the small business may take longer to sign on, he said. “I am going to see longer sales cycles, but I am going to see much more business.”

6 states with the highest startup rates

A surprising upside: Pablo Solomon, an artist and designer living outside of Austin, Texas, makes his living selling his drawings and sculptures. He does not have a storefront, but communicates with his clients through the Internet from his ranch.

Customers who purchase less expensive items — like prints or reproductions — have been buying less — the result of an uncertain economy.

But his well-off customers — which include billionaires — are buying more.

“They are trying to figure out what to do with their money other than buying gold and platinum,” said Solomon. “They will buy art, and they will buy good art.”

These wealthy investors are looking for places to store value, he explained. They are also spending their money on luxuries they can enjoy, like vacations, art or sports cars.

“Every time the stock market bounces, they are going out and buying stuff they always wanted,” he said.  To top of page

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Commercial Mortgage Finance – The Next Shoe To Drop?

This further confirms what I am saying.   The biggest threat to commercial is not the notes coming due, it is no more a threat at this point then the foreclosure problem in residential.   A problem-yes but one that is working it’s way through because the banks are willing to modify, and the trillions are sitting there ready to buy the paper.   The biggest threat is the economy because the more vacancy, the less cash flow and the worse the property will appraise.   So vacancy, is really the big fear.   If you think that the economy has turned, and there is a lot of evidence to support it, then now is the time to buy commercial property.   Now is the time to get aggressive in commercial.   I am telling you from where I sit, there is more business happening then I can write.   SBA Loans, franchise loans, experienced investors, refinances, it is all happening.   Commercial is not about to bottom, commercial already has bottomed and all the experienced people I talk to are slammed with deals.   It is a GREAT time to be in commercial!

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Commercial Property Loan Rates – The Lowest of the Year!

Apartment building by sylvar, on Flickr
Creative Commons Attribution 2.0 Generic License    by    sylvar  

The stock market sell off of the last two weeks has created a refinancing and purchase opportunity of a lifetime in commercial real estate!

Rates on most products are in the 5’s now with the low 5’s and even the 4’s available on select property types. People with balloon notes due in the next 2 years should seriously consider a refinance and, if you are in the market for commercial real estate, you can not beat the financing rates available at this time.

Of course, financing is still tight and, you need to work with someone with a proven track record of actually closing loans but, the rates create a unique opportunity.

To find out where the rates are for your property type or situation, or to get a quick commercial loan approval for a purchase, call me, Karen Schimpf today at 866-400-8630

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