Whether you’re a real estate or small business entrepreneur, building a successful company is about having the best business information to ensure work is completed efficiently and effectively. Whether it’s how to build a business credit score, finding leads, or how to better manage your company, in this article you’ll find advice that can lead to the continued growth of your business. Here are 23 tips and tools to help you take your business to the next level:
- Building a Better Business Credit Score - com has released a new guide. It explains how a business credit score works and lists the business credit agencies and their scoring methods. It also contains suggestions for building and improving business credit scores, and more.
- You try to do everything yourself. You’re answering the phones, balancing the books, and overseeing your marketing. Not only are you exhausted all the time, but opportunities are falling through the cracks because you’re too busy to take advantage of them. Change it up:In order for your business to grow, you have to let some things go. Figure out what daily activities bring the least value to your business, and find a way to delegate them—whether by bringing in a part-time employee or outsourcing to a virtual assistant. Then figure out what daily activities best use your particular skills, and focus on those.
- Improve your balance sheet. Decrease your receivables and go aggressively to collect on those non-payers. Assess your inventory and plan how to turn them into cash if you cannot sell them. If you need financing and can’t qualify for a conventional loan, consider alternative sources.
- Determine what your business is worth. This information can help you in seeking investors, when deciding to sell, and for other purposes. Use an experienced business appraiser, which can be costly. For a DIY approach, use com to get a general idea of your company’s value.
- Set aside funds for taxes. Self-employed individuals, corporations, and others have to pay quarterly estimated taxes to the federal government and, in most instances, to states as well. Don’t be caught short of cash for this purpose. Create a bank account for taxes so funds will be restricted for this purpose and you won’t be tempted to use them for anything else. When we review a business owner’s personal credit report, most often, this is the negative item that comes back to haunt them time after time. Why? Unpaid tax liens can remain on a personal credit report indefinitely. Do you have a paid federal tax lien still showing on your credit report? Learn how you may be able to get that tax lien removed from your report.
- Create professionally designed graphics for your blog or marketing materials – Free. Canva will be your new best friend. Use pre-formatted templates to create social media banners, blog graphics, marketing flyers, and much more. Free and idiot proof, Canva will make you look like a seasoned pro.
- Find leads through social media. Consider using a tool such as LeadSift. This cloud-based tool sifts through social media conversations to identify those relevant to you. You can get a free sample report of leads who engaged your competitors in the last 24 hours.
- Secure a line of credit before you really need one. As long as your finances are in order, you can command a line that you can tap into as needed. For example, lenders offer options up to $1M with no application fee. Complete this loan scenario to explore your possibilities.
- Plan before you apply for financing.Discuss financing plans with your accountant. Ensure, if applicable, your tax return will not show a loss. Depending on the loan type, you may be asked if your business made a profit on one or both of your last two tax returns. If you answer no, you will unlikely qualify for a low-interest loan from traditional lender. However, you may be eligible for a stated-income business LOC.
- Know your debt service coverage ratio (DSCR).This is the ratio of cash a business has available for servicing its debt, including making payments on principal, interest, and leases. Different lenders may calculate the ratio differently. But fundamentally, a DSCR is calculated by dividing total annual net operating income by total annual debt service. So, if you apply for a loan with a debt service that will cost $23,000 annually and net income is $25,000: $25,000/$23,000 equals a 1.09 DSCR. Many alternative lenders require a DSCR of 1%+. Traditional lenders are unlikely to go below a DSCR of 1.25%.
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Lathea Morris ▪ www.MorlinoandLathea.com ▪ 973.509.1903 Ext. 1#