Small Business Resource

High on the wish list for most business owners is likely to be finding effective guidance for obtaining small business finance help. This article is designed to provide a practical starting point for a commercial finance survival guide. Due to the rapidly increasing failure of banks to provide a normal level of commercial funding, the suggestions described in this article should be considered by most business borrowers in the initial stages of their commercial financing efforts rather than as a last resort.

The recent failure of banks to provide adequate business financing options has created the necessity for small business owners to adopt aggressive tactics. Surviving the current business finance crisis is clearly an important goal for any small business owner. This article will illustrate the importance for small business owners doing whatever it takes to survive in a tough commercial lending climate.

For many commercial borrowers, the option of firing their lender has not yet become apparent. But with an aggressive business loan perspective that is increasingly appropriate for small business owners impacted by widespread banking chaos, commercial borrowers should be prepared to look out for their own financial interests because it is unlikely that their banker is up to the task anymore. One of the most predictive signs that a commercial borrower might need to fire their lender is when their commercial banker is unable to finalize the business financing which was initially discussed or offered.

For businesses to survive in an erratic lending climate, the use of innovative financing tactics means that some small business loan options which borrowers previously ruled out because they were too complicated or costly might merit a second look. A business cash advance program (also referred to as credit card financing and merchant financing) is a key example of a commercial financing strategy which has probably been a Plan B for many small businesses but not their eventual choice for acquiring more working capital. With a sudden reduction in business lines of credit and an increased requirement for collateral by many commercial lenders, the use of credit card processing to obtain working capital now has more practical appeal for the typical small business owner who needs more cash for their daily operations.

Separating the good banks from the bad banks should be a high priority for any commercial borrower. The most practical gauge for defining whether a bank is good or bad from a small business owner perspective should normally be guided by whether the required commercial financing options can be provided or not. Although banks have been broadly stating that they are offering a normal level of business funding, there are multiple reports indicating otherwise. It is reasonable to conclude that if a bank is not providing commercial loans as usual, it certainly might be because they do not have sufficient financial resources for small business lending. On the only scorecard that matters to most business owners, the few good banks will gradually become obvious based on their documented small business lending activities. In the meantime, business owners should expect to need some professional help in finding these few remaining good banks.

As in many activities which are guided by technical aspects, a lack of sufficient information can lead to devastating consequences. One practical way for business owners to overcome a substantial information gap is to use a business consultant who is a small business loan expert. When evaluating banks which are not functioning normally and more complicated small business financing programs, the current business lending climate is likely to be discouraging for inexperienced borrowers. A business consultant experienced in the ways of overcoming commercial lending problems can be helpful in finding pragmatic solutions.

In all probability locating new and reliable business lending sources will be an essential element in surviving the commercial financing crisis. But it is important to consider new small business finance strategies as well as new lending sources. In addition to the aggressive financing strategies already discussed, there are several other business finance choices which should be evaluated by business borrowers before arranging their commercial loans. One key example is factoring of receivables. Many successful businesses routinely experience difficulty in matching the timing of their income with expenses. Previously this kind of situation was handled adequately by arranging a business line of credit with a bank. Because this particular option (commercial lines of credit) is rapidly disappearing as a realistic alternative, receivables financing has emerged as a primary commercial finance tool for many businesses. Like most of the promising business financing options which can effectively replace current bank financing, small business owners will need to take the initiative to explore and analyze such choices.

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Stephen Bush is a small business financing expert who has worked with business owners for 30 years. AEX Commercial Financing Group provides business cash advances and small business finance programs