There’s been a lot of talk about how hard it is for small businesses to get credit these days, and for sure there has been a decrease in the amount and size of loans that are available, driving some companies to borrow money at loan shark rates.
A recent article in the NY Times entitled “Spurned By Banks, Small Businesses Find Cash Where They Can” interviewed small manufacturing companies who had found their way to lenders that specialize in “purchase order financing” charge high APRs to loan money against orders. One such company mentioned in the Times article charges about 40% per year, but said most borrowers pay back funds within 60 days (read article here).
But I wonder, how many companies can actually pay back the loans that quickly, and if they don’t, are their margins high enough to support such loans – or are they just getting themselves stuck in a cash flow crunch that has no end?
Susan Martin, Small Business Financial Management Coaching
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By Susan Martin
NYC based Business Coach, Consultant and Strategist Susan Martin is no stranger to entrepreneurship, as she spent the first 25 years of her career running her own successful companies before deciding to dedicate her work to helping others achieve "Business Sanity."
A professionally trained business coach, Susan is a popular business workshop facilitator and speaker at events and professional groups in and around New York City. She helps business owners, executives, managers, salespeople and independent professionals stop struggling and learn how to run their businesses easily and effectively so that they can make more money, have less stress and more quality time to enjoy life.
Susan's clients want to increase sales and profits, boost productivity, manage their time, motivate their employees, increase performance and leadership skills, plan strategically and have balance in their lives. She provides the guidance, support, encouragement and accountability needed to achieve their goals.
If running your business is a struggle, contact Susan to find out how she can help.
View all of Susan Martin's posts.
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Alisha
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Thanks Alisha, enjoy.