PROFITABLE BUSINESS By: Myra Good 5 STEPS TO BUILD A POWERFUL AND - - PowerPoint PPT Presentation

STEPS TO BUILD A POWERFUL & PROFITABLE BUSINESS

ENTREPRENUERSHIP EMPOWERMENT

By: Myra Good

SOUND BUSINESS STRUCTURE IN-DEMAND PRODUCTS & SERVICES SECURE FUNDING BUSINESS CREDIT PERSONAL CREDIT

5 STEPS TO BUILD A POWERFUL AND PROFITABLE BUSINESS

BETWEEN 2007 and 2018 THERE WAS AN INCREASE OF BLACK WOMEN OWNED FIRMS BY 164%

(Source: American Express Women Owned Business Report) (Source: American Express Women Owned Business Report)

THERE ARE 2.4 MILLION AA WOMEN OWNED BUSINESSES AGES BETWEEN 35 TO 54

(Source: American Express Women Owned Business Report)

What this means?

• Children
• Elderly care
• Highest Earning Years
• Shift in Retirement Goals

The he Pro roblem blem . . . . . .

Where re Would d You Go If You Ne Need ed Money ey?

The Old Way

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HOW IT CURRENTLY WORKS ✓Over 75% of business owners go to friends and family ✓Most also use personal assets ✓And almost all business owners use their personal credit to grow

75%

ALTERNATIVE PATHS TO FUNDING

Cash Flow Financing

▪ Cash Advances that look at bank account management for approval ▪ Need more than $10,000 in deposits ▪ Must manage your bank account and have consistent deposits ▪ Can typically get as much as 12% of your annual revenue advanced ▪ This is high risk lending as NO collateral is pledged

Rates are super low, much lower than with conventional SBA loans….as low as 2% Collateral-based financing can be obtained if you have some type of viable collateral to offset what you’re borrowing Even as a startup with bad credit, you can still secure collateral financing, if you have collateral

Collateral Based Financing

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Some e Types pes

• Accounts Receivables and Purchase

Orders

• Stocks, Bonds, and 401k’s
• Inventory and Equipment
• Real Estate
• Even an Insurance Book of Business

Credit Based Financing

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HO HOW IT IT WORKS ✓Unsecured, credit based financing is a great way to get money for you business if you have good personal credit or know a guarantor who does ✓You can secure credit up to 5 times of what your highest revolving limit account has now… up to $150,000 ✓Rates are usually 0% for 6-18 months ✓This is NO DOC funding, so even startups can qualify ✓Accounts report to the business credit bureaus

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Other Alternative Financing Options

OPTIONS

Private Money

Is also available if you have good tax returns

Crowdfunding

Doesn’t require cash flow, collateral, or good credit.

Specialized

You can receive specialized funding to buy equipment, signs and vehicle wraps

Where ere Woul uld d You u Go Go If You u Needed ed Fu Funding? nding?

What is Business Credit?

Business Credit is credit that is obtained in a Business Name. With business credit the Business builds its credit profile and credit score for its EIN number. This credit is in the business name and based on the business’s ability to pay, not the business owners.

Business Credit Benefits

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NO PERSONAL LIABILITY Fast Initial Establishment of Credit Profile and Score DOUBLES Your Borrowing Ability Business Credit Scores are Based on Only ONE Main Factor

Expect Early Payment (100) Payment is Prompt (80) Payment comes 14 days beyond terms (70) Payment comes 21 days beyond) terms (60

Accumulation of New Credit (10%)In

Payment comes 90 days beyond terms (30) Payment comes 120 days beyond terms (20) .

Business Credit Benefits

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Your Personal Credit Is based on 5 factors Payment History (35%)

.

Your Business Credit Is based payment history Utilization (30%) Length of Credit History (15%)

Payment comes 30 days beyond terms (50) Payment comes 60 days beyond terms (40)

Credit Score Factors

Credit Mix (10%)In

Why Building Business Credit is Better

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NO NO PER ERSONAL LIABILITY PER ERFECT FOR STARTUPS NO NO CASH FL FLOW RE REQUIMENTS NO NO COLLATERAL RE REQUIRMENTS EASI SIER TO GR GROW A BUS USINESS ESS SSENTIAL TO SE SELL YOUR BUS USINESS

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START TODAY: THE CREDIBILITY CHECKLIST

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YOUR ENTITY

WEBSITE

PHONE NUMBER

LICENSES

EMAIL EIN

BANK ACCOUNT

BUSINESS ADDRESS

Build Business Credibility

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HO HOW IT IT CU CURRENTLY WORKS ✓Over 75% of business owners go to friends and family ✓Most also use personal assets ✓And almost all business owners use their personal credit to grow

Buil ild Busin siness ss Credibil edibilit ity y

• The perception lenders, vendors, and creditors

have of your business is critical to your ability to build strong business credit.

• Before applying for business credit a business

must insure it meets or exceeds all lender credibility standards

• There are over 20 credibility points that are

necessary for a business to have a strong, credible foundation

Busi siness ness Na Name me

• It is very important that you use

your exact business legal name

• Your full business name should

include any recorded DBA filing you will be using

• Insure your business name is

exactly the same on your corporation papers, licenses, and bank statements

Co Corp rporate

• rate Enti

tities ties

• You can build business credit with almost

any corporate entity type

• If you truly want to separate business

credit from personal credit your business must be a separate legal entity not a sole proprietor or partnership

• Unless you have a separate business

entity (Corporation or LLC) you might be "doing business" but you are not truly "a business“

• You need to be a Corporation or an LLC in
• rder to separate personal from business

EIN IN

• Just like you have a Social Security

Number, your business has an EIN

• Your Tax ID number is used to open

your bank account and to build your business credit profile

• Take the time to verify that all

agencies, banks, and trade credit vendors have your business listed with the same Tax ID number

Business siness Address dress

• Business Address
• Must be a real brick-and-

mortar building

• Deliverable physical

address

• Cannot be a home address
• Cannot be a PO Box
• Cannot be a UPS address
• Some lenders will not approve

and fund unless this criteria is met

Busi siness ness Ad Address ress

Business Address Solutions

• Address Only - Receive mail and packages

at your dedicated business address

• Virtual Office - Professional business

address, dedicated phone and fax numbers, receptionist services, and part- time use of fully furnished offices and meeting rooms

• True Office - Your own full-time private
• ffice with receptionist services, dedicated

phone and fax, internet, full furnishings, meeting rooms, and more

Busi siness ness Lis isti ting ng

• 411

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• You must have a dedicated business phone

number that is listed with 411 directory assistance, under the business name

• Lenders, vendors, creditors, and even

insurance providers will verify that your business is listed with 411

• A toll-free number will give your business

credibility, but you must have a LOCAL business number for the listing with 411 directory assistance

Pho hone e Nu Numb mber er

• Lenders perceive 800 Number or toll-free

phone numbers as a sign of business credibility

• Even if you're a single owner with a home-

based business, a toll-free number provides the perception that you are an even bigger company

• It's incredibly easy and inexpensive to set-

up a virtual local phone number or a toll free 800 number

Pho hone e Nu Numb mber er

• A cell or home phone number

as your main business line could get you "flagged" as an un-established business that is too high of a risk.

• DON'T give a personal cell

phone or residential phone as the business phone number

• You can forward a virtual

number to any cell or land- line phone number

Fa Fax x Nu Numb mber er

• Lenders perceive a credible business as
• ne with a fax number
• As a business you will need a fax number

to receive important documents, you will also need it to fax in some of your credit applications

• You can setup an e-fax that goes directly

to your email

Website

• Credit providers will research your company on the

internet

• It is best if they learned everything directly from

your company website

• Not having a company website will severely hurt

their chances of obtaining business credit

• There are many places online that offer affordable

business websites so you can have an internet presence that displays an overview of your company's services and contact information

Ema mail il

• It is important to get a company email

address for your business

• It's not only professional, but greatly

helps your chances of getting the thumbs up from a credit provider

• Setting up a business email address is just

too easy and inexpensive to neglect

Bank Account unt

• Your business banking history is vital to your

future success of being able to secure larger business loans

• The date you open your business bank account

is the day that lender's consider your business to have started

• So if you incorporated your business 10 years

ago, but you just opened the business bank account yesterday, then your business started yesterday

• The longer your business banking

history, the better your borrowing potential will be

Bank Account unt

• Having a high account balance is essential in
• btaining an excellent Bank Rating
• Having a good Bank Rating is essential for loan

approval down the road

• Try to keep a bank balance of $10,000 or higher

for a 5 Bank Rating

Lic icen ensing sing

• One of the most common mistakes when

building credit for your company is non- matching business addresses on your business licenses

• Even worse is not having the "required" licenses

for your type of business to operate legally

• You will need to contact the State, County, and

City Government offices to see if there are any required licenses and permits to operate your type of business

Lic icensin nsing

• State business filings listed correctly
• County license and/or permit filings listed

correctly

• City license and/or permit filings listed correctly
• IRS filings listed correctly

RECAP: THE CREDIBILITY CHECKLIST

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YOUR ENTITY

WEBSITE

PHONE NUMBER

LICENSES

EMAIL EIN

BANK ACCOUNT

BUSINESS ADDRESS

RESOURCE LIST

QUESTIONS???

PERSONAL CREDIT WHOLESALETRADELINES.COM CREDIT FINANCING LENCRED.COM BUSINESS CREDIT & ALT FUNDING CREDITSUITE.COM BUSINESS PHONE/FAX/411 LISTING RINGCENTRAL.COM