How To Prevent Corporate Bankruptcy
As a business owner or someone thinking of
starting a business, you're probably aware that the "deck's stacked against
you" in your race for survival.
Before we talk about preventing corporate
bankruptcy, I'd like to share some facts and statistics that you may or
may not be aware of. These statistics are shocking, but what's more important
are all the real people (just like you) that lose their companies or their
jobs: due to lack of sufficient corporate credit, better corporate credit
terms, and open-end corporate lines of credit.
Obviously, small businesses are critical
to the overall support of the American economy. But, most people don't
realize just how important small businesses are to every region of the
United States. The United States Small Business Administration (also known
as the SBA) keeps records and statistics on small business in the United
States and some of their findings are surprising.
19% of all businesses fail within their
first year, almost 35% fail within 2 years, more than 51% fail by the end
of year three, and approximately 67% fail after four years. Access to capital,
owner's education levels, an established business plan, and the usage of
professional accountants appear to be the most likely reasons for business
failures today.
First, the typical picture of the local
mom and pop country grocery store, beauty salon, barber, gas station, and
more: is not the entire picture.
By definition, the SBA defines an independently-owned
business with less than 500 employees as a small business. More than 23
million businesses in the United States meet this classification. These
businesses represent a major source of employment within small communities,
throughout the US.
In fact, these small businesses account
for more than 99.6% of all the employers in the country and also employ
more than half of all non-government jobs. From 1996 through 2006, small
businesses have accounted for more than 73% of all new jobs.
Retail and service-related businesses comprise
more than 43% of new job openings each year, although small businesses
are rapidly making gains in the technology sector too. More than 40% of
engineers, scientists and computer programmers are employed by small businesses.
And, oddly enough, small businesses produce 1383% more patents than larger
companies.
Now, let's talk about the #1 reason for
business failures (as cited by small business owners) which is money. Access
to financing, the lack of available financial assistance, not understanding
how to properly utilize credit, waiting too late before applying for credit
are just a few of the examples that force businesses to fail... which is
bad for the economy.
Because when businesses fail, we all lose.
More than 98% of all small business owners
said they've used personal credit cards to fund the operation or startup
of their businesses, and more than 68% said they still use their personal
credit when necessary.
Worse still, is that 82% of all small business
owners were unaware of financing options other than their local banks,
grants (for the few that could qualify), and use of personal debt.
Lucky for you... there is a better way!
Simply be proactive. Seek out business
credit offers every step of the way, and if you're uncertain where to turn.
However, if you don't understand how to setup, structure and maintain your
corporate credit file (which doesn't operate exactly like your personal
credit scores)... you could be facing an uphill battle.
Your personal banker, mortgage professional,
financial planner and CPA will not be able to point you in the direction.
And, trust me... Ive learned by failing myself.
You need to find a corporate credit expert
that can provide you with a corporate identity (unless you already have
one), that will help you register your business with Dun & Bradstreet
(establishing a corporate credit history), and that can help you achieve
lines of credit equal to $250,000-$1,000,000 in 60-90 days.
I found a person like this, and it's changed
my life forever. Stop looking for "angels" or lottery winnings to dig you
out of your messes, and get in touch with a corporate credit expert...
today.
Author-Bio:
Lee Kendrick has been featured in numerous
magazines as a highly respected credit expert, finance professional, internet
marketer, software developer, public speaker, aspiring author & all-around
nice guy.
http://leekendrick.net/corporate-credit-concepts.htm
|
