Business planning and strategy

Bank loans are usually the least expensive way to finance a small business. However, it is not easy to get a bank loan, as banks have strict standards for lending. As a general rule of thumb, banks will require a borrower to put up collateral for a loan. The only exception to this rule is for clients who have a long-term relationship with banks and whose business has proven to be profitable over a multi-year period.

When borrowing from family and friends is the only way to start or fund a business, the following steps can greatly reduce that risk. First, you must inform the person you’re borrowing from how much money you need, what you’ll use it for and how you’ll pay it back. Next, draw up the legal papers -- an agreement stating that the person will indeed put money into the business.

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Optimism seems to be abound, economically at least, with a businessman heading for the White House. The Dow has risen and, despite vocal opposition from opponents on many of his decisions, President-elect Trump has been announcing job creation measures even before he has taken the oath of office. For Wall St. and Main St., exciting things are happening. Banks and FinTech companies are using technological advances to improve access to capital, which is the lifeblood for small business growth. These developments bode well for small businesses in search of capital in 2017.

A federal tax lien is filed by the federal government when you owe money in taxes to the IRS. These documents ensure that the government will receive the taxes they are owed by giving them a right or claim to your personal property. Liens look bad on your credit report and can be difficult to remove, but there are resources to help you resolve the issue.

Businessmen often have good ideas and clear image of the turning them into the reality. Unfortunately, like all good things in life, these need solid ground and specifically rather big amount of money. It requires thorough business plan and hours of visits from one potential investor to another amid hopes someone will be interested enough to invest. And there is no guarantee this strategy will work out. After years of the futile attempts, disappointment still has a chance to weigh down the balance.

Running a small business doesn’t come cheap. Even if you’ve scrimped and saved to bootstrap the operation on your own, or were fortunate enough to get an investment from friends or family, there may come a time when you need a loan to continue operating your business.

Whether it’s working capital to fulfill a large order, a small loan to purchase new equipment, or a large loan to expand to a new location, chances are that at least once in the life of your business you’ll need to approach a bank for a loan.

A line of credit is the most sought offer financing option for business owners. Why? The flexibility they provide is unparalleled. Whereas your typical term loan will give you one lump sum of cash to use -- and to pay back over time -- a line of credit is more like a reserve pool of a set amount. You can draw capital up to that maximum when you need, and you’ll only pay interest on what you withdraw.