How to get a business loan from a bank

Many women are intimidated by the thought of getting involved in financial matters. As a group, buying a house or securing a business loan, even a personal loan, are not activities we were traditionally involved in before the women's movement. But our society has changed, where women are concerned, and more women are on their own and learning how to buy houses and start their own businesses then ever before.

Communicating with bankers
Bankers are pretty savvy people so you must have done your homework and know something about what you need to bring to the table if you're asking a bank to lend you money to either start up or expand an exiating business. Even when you can show a strong credit rating and possess collateral, they still demand that you explain in sufficient detail how you will use their money, what profit you expect to make with it and how you win pay it back. Bankers do not want to advance money to you just to improve your lifestyle.

Bankers when considering your request for a loan-they would like to see you produce $3 of profit for every $1 of their money borrowed often use an unspoken formula. In order to produce this financial result you must invest a substantial portion of your loan in well focused marketing activities, such as magazine ads, direct mail promotions and adding inside and outside sales assistance.

Keep one fact in mind when considering a bank loan: more than anything else, bankers must assure that they get paid back, on time. Be prepared to offer several ways that they can use to get their money back if the worst happens to your business. Don't take this attitude as a personal insult. It is simply how the world of commercial banking works.

The Eight Step Approach to Asking For A Bank Loan
Be realistic however, when you are considering the request for bank financing--it can take several months to finish your business plan summary and pull together the necessary documentation to satisfy the bank's demands. Allow enough time before you apply. Avoid waiting until you are desperate for cash!

Step 1 : Why Do You Want Money?

• Pay off debts
• Substitute new debt for equity
• To buy equipment, vehicles, and buildings
• To expand business through more marketing, inventory, people,etc.
• Be honest. Have you really checked out sources of money other than banks? (for example: Credit terms from suppliers, payment advances from customers, loans from family, friends, private investors)

Step #2: How to Check Out Banks

• Check out how financially sound the banks are you are considering.
• Ask for the bank's latest annual report. Read the description of how their business was last year and look at their financial statements
• Ask the banker to compare their capital reserves to the requirements of the federal regulators.
• Ask to be shown a sample loan application package before you decide which bank to choose
• Read the package over, making notes on anything you question or don't understand
• Contact the bank lending officer with your questions. If you are not comfortable with how they are answered, look elsewhere.

Step #3: Communicating With The Bank

• The history of your company
• Summary of market conditions, including competition, and your marketing strategy the 5 P's-- People, Product, Price, Place & Promotion. Historical financial results & future projections -- Profit & Loss and Cash Flow
• Err on the side of conservatism
• Best to have past financials on accountants letterhead
• Your resume--Why are you qualified to run the company?
• Examples of products or services (photos, brochures, videos, etc.)
• Personal financial statement
• If applicable: inventory requirements; accounts receivable aging
• possibly a business plan

Step #4: What To Expect When You First Visit the Bank

• Try to meet the loan office first outside of the bank, say for lunch--this is "neutral turf."
• Come prepared with a combination one-page business plan summary and loan request
• Indicate on the loan request how much money you are looking for; what you win use it for (be specific); how long you want to borrow it; how you will pay the loan back; and what you plan to do if your revenue isn't enough to cover the loan payments.
• Expect them to examine your personal credit history, so do it before they do by contacting one of the three big credit agencies: TRW, Equifax, & Trans Union.
• Think in advance what you will use as security for the loan--that is collateral.
• Expect the loan officer to ask some pointed questions about your certainty of attaining the future sales and profits you are projecting.
• Know your personal and company finances forwards and backwards!
  

Step #5: Realize The Importance of Cash Flow & Credit

• Realize the essential reality of borrowing from a bank: They want their money back! And they want it on a regular schedule. They don't really want to have to take over your company or sell your collateral.
• This reality results in the banker doggedly pursuing your projection of cash flow for the year or two after you will receive the loan.
• The "C" of cash flow is one of five "Cs" that bankers look for from good loan applicants.

The list of " 5 C's" are:

• capacity - Ability to repay.
• Character - Your willingness to show discipline and keep your promises to repay
• Capital - How much have you and other investors put into the business?
• Conditions - How is your industry doing?
• Collateral - Your security.

Step #6: Understand the Types of Loans

• Short-term loans. For one year or less. Normally used for short-term uses, such as inventory. Need for loan and repayment occur in the same 12 month period.
• Working capital loans. Also short-ten-n, usually to cover your cash needs after you make and sell your product, but before you get paid.
• Seasonal loans. Loan is paid off at the end of season.
• Term loans. Maturities of one to five years. Used primarily to purchase capital equipment and to give semi-permanent increase in working capital. Paid back in monthly payments.
• Long-term loans. Over five years in length. Used to build, buy real estate, acquire an existing business or buy a franchise.
• SBA loans. Loans where the principal repayment is partially guaranteed by the U.S. government. Line of credit. Similar to a credit card loan.

Step #7.- Learn How banks make Loan Decisions

• They assess the 5 C's
• They look for a persuasive marketing strategy
• They look for determination on your part
• They look for financial projections that support your marketing strategy


• They look at how much they can make on your proposed loan
• They look for significant experience in managing your type of business
• They look at how much of your own (or family's) money you have put into the company
• They look at what you will do with the money.
• They examine the most recent financial results for your business.
• They examine what security (collateral) you can put up.

What to negotiate with the bank:

• Interest rate--Get two banks to bid and compare their rates.
• Length of loan--Set a maximum monthly payment you wish to make and drive for a repayment length that will allow this.
• Personal guarantee--Hard to avoid, particularly if you are a corporation. But you'll never know if you don't ask.
• Collateral--Try to get by with only business collateral. If they insist on personal collateral, DO NOT up your house. Try putting up a CD instead.

Shop around--Don't settle for the first bank offer. If you proposal package is good enough to be considered for any bank loan, it is good enough to show to several banks.

Step #8: Understand What Happens After the Loan Request is Accepted

You should review the paperwork with your accountant to make sure it is in your best interest. You may wish to use your accountant as your negotiator with the banks offering you financing. At the loan closing, you must:

• Produce title to your collateral.
• Usually sign personal and commercial guarantees.
• If a corporation, sign a corporate resolution to borrow" which says you are the authorized corporate officer allowed to sign agreements.
• Sign signature cards if you open business bank accounts.
• Sign a promissory note(this is where you sign your life away).
• Sign a disbursement request to release the funds to you. On term loans, you receive the whole loan at once. On credit lines, you only receive what you need initially. The remainder is approved but not drawn, which saves you interest cost.



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Are women still banging their heads against the glass ceiling?

The term "glass ceiling" was coined more than twenty years ago by The Wall Street Journal to describe the barriers that women face in the workplace. The word "ceiling" suggests that women are blocked from advancing in their careers, and the term "glass" is used because the ceiling is not always discernable.

Glass ceilings are still found in workplaces, not only in the discrimination of pay scales, but is also marked by sexual harassment, exploitation at work and also as a feeling of insecurity in women due to conduct of the opposite sex. Women struggle to incarnate their own personality in spite of restriction of gender discrimination. A workplace should consider the ability of an individual and not the issues of ‘glass ceiling’ based on sex, religion, culture and race of minority class.

But, to the contrary, some studies on this issue have concluded that women are actually to blame for the "glass ceiling" They cite responses that indicate that women underestimate their own performance, suggesting a lack of confidence in the workplace, therefore creating the glass ceiling themselves. But, at no time did the study question why they underestimated their own performances, leaving the possibility that the "glass ceiling" itself could be the reason.

Perhaps it could be the absence of role models at the highest executive levels, considering only 2.6 percent of CEOs of Fortune 500 companies are female. Another recent study could shed light on the reasons women underestimate their workplace performance – that study showed that employers consider fathers to be “more competent and committed” than their childless counterparts but mothers are 100 percent less likely to be hired, offered $11,000 less in pay, and ranked as “less competent and less committed” than non-mothers. Not to mention that other workplace barriers such as pregnancy discrimination, sexual harassment, and pay discrimination could lead to decreased self confidence.

During this time of economic desperation, women should be given equal chances to succeed and accomplish their goals in the workforce without undue discrimination.Law requires the workplace to be free from discrimination and judgment when it comes to hiring and advancement. The world is changing, and it is time for the workplace to make a final turn toward equality among workers, both male and female.

Social Media seminar

Social Media Pre-Conference SeminarJan 17,2010,1-4
Billiards Rm, Conrad-Caldwell House, Louisville, Ky

This seminar will concentrate on the latest uses of Internet marketing to increase exposure and customer base for participating bed and breakfast Innkeepers. In addition, by exploring the emerging world of social media, participants will come to understand the rationale behind using social media to engage and connect to an audience of potential customers. They will come to understand the importance of using the language and seeking out the social networking communities where their prospective customers are. And that this is where their outbound marketing messages should be. Participants will learn strategies for increasing their website presence, for deciding when and how to use social media platforms and tools, and for managing their time.

This seminar will be presented by Jason Falls, social media consultant. Jason is a nationally recognized expert on public relations, social media and online communications with 12 years of management experience and proven ability in public relations, social media, marketing, corporate communications, branding and advertising. His vision is for high-return media opportunities and communications strategies that strengthen organizational marketing positions and enhance growth. Jason is a father, husband and thinker, mostly on social media, public relations and communications for clients of his consultancy and readers of his popular industry website and blog, He resides in Louisville, is co-founder and president of Social Media Club of Louisville, and has recently established his own consultancy: Social Media Explorer.

Growing Your Business With Social Media Marketing
Seminar presented by Jason Falls of Social Media Explorer

Agenda
Solidifying Your Home Base: Put your website to work
Understanding Social Media philosophy
Listening & participating in Social Media & social networks
Making email marketing work smarter

Buoying your business through blogger outreach

Learning the tools and managing your time

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Is your business eco-friendly?

"No one person has to do it all but if each one of us follow our heart and our own inclinations

we will find the small things that we can do to create a sustainable future and a healthy environment." John Denver

My business is in an old historic home. When we made the decision to go "green", we approached it by analyzing the many ways we could save on energy and not pollute the environment. It became clear that having a business in a home enabled us to easily set up all sorts of ways to make the necessary changes in order become a full fledged eco-friendly place of lodging.

Other small businesses can easily do the same thing. It just takes a little time and thought and a big commitment. Putting changes in place will not make a difference unless you honor those changes and commit to upholding them no matter what. I have listed what I consider the easiest areas to address when you first begin to make these important changes. We are in hopes that other businesses can use us as a model for their own endeavors.

Environmental awareness (community)

One of the first areas to address is the environment itself. Our employees have done a little research on the issues that most affect our environment. They have come up with the following list:

Environmental issues

• Invasive Plants and Animals
• Global Warming/Climate Change
• Air Pollution
• Unsustainable Agriculture
• Water Quality
• Habitat Loss/Degradation/Fragmentation

• Overpopulation

In an effort to address these issues, each employee has made himself aware of the problem, where he or she can go to find information on the problem, and how he or she can help eliminate it. It's important that each and everyone one of us develop the attitude that "every little bit helps"; otherwise, the solution would be too overwhelming to even address. We have posted these issues in our Inn, in the reception area, with a list of online web addresses, where more information can be found. Employees are encouraged to discuss these issues with our guests. Following, are a list of online

sources of information:

http://www.globalissues.org/

http://www.envirolink.org/

http://www.actionbioscience.org/environment/index.html

http://www.planetpals.com/

http://www.epa.gov/region5/students/basics.htm

Specific issues and hands-on solutions

To kick off our eco-friendly program, we selected the following issues to address immediately. They appeared to be the easiest to implement, as some of them were already being addressed.

• Waste reduction/reuse/recycling
• Energy efficiency
• Water conservation
• Indoor air quality
• Biodegradable products

Waste: The best way to reduce waste is not to make it in the first place. These three strategies are ways in which that can be accomplished:

• reduce waste (http://www.bnbscape.com/ecotips-reduce.html)
• reuse receptacles and containers (http://www.bnbscape.com/ecotips-reuse.html)
• recycle those you cannot reuse (http://www.bnbscape.com/ecotips-recycle.html)

Our Inn has managed to address all three issues. We are very careful to avoid creating unnecessary waste and to reuse and recycle all containers and paper and plastic products.

Energy efficiency: This turned out to be fairly easy to address. We immediately changed all of our light bulbs to energy efficient ones, we made a concerted effort to turn off all lights and electrical devices we were not using, and to keep the heat at 65 degrees. We needed a new furnace recently and so installed an energy efficient one which has really stabilized the environment in the Inn.

Water conservation: The first thing we did was to switch from changing guest towels every day to changing them every two or three days. When guests check in, we tell them about our "green" program and ask them if they mind adhering to our policies. All, but one couple, agreed. Next, we made sure that faucets were not left running when not in use, the water in our laundry loads was reduced, and that the washing machine and dishwasher were not run until loaded to capacity.

Indoor air quality: Some of the things we have done are: test for molds, bacteria, and carbon dioxide; change filters frequently; adhere to a non-smoking policy; make sure dust is picked up with end-dust on a clean cloth or dust mop.; and keep solvents in air tight containers. There are many more things that can be done

Biodegradable products: Instead of using toxic solvents and cleaners we have switched to the following, which are all available at the supermarket. Containers have instructions on how to use these products.

• soaps without synthetic scents, colors or other additives
• baking sodas
• washing soda
• white vinegar
• lemon juice
• cloudy ammonia

If all businesses did even half of the above it would make a big difference in our environment.

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Love this one!

Life is not about waiting for the storms to pass. It's about learning how to dance in the rain.

Are women less happy today as a result of the women's liberation movement?

I recently read a study entitled "The Paradcox of Declining Female happiness" by Betsey Stevenson and Justin Wolpers, economists at the University of Pennsylvania. I was first drawn to the study by the interest it has been getting lately. It was conducted in 2007, but is still getting a lot of attention.

Based on in the General Social Survey (GSS) 1972-2006, the results from the Stevenson and Wolpers study suggest the possibility that the women's liberation movement and feminism may be partly responsible for the decline in happiness evidenced by modern US women.

According to Maggie Humm and Rebecca Walker, the history of feminism can be divided into three waves. The first feminist wave was in the nineteenth and early twentieth centuries, the second was in the 1960s and 1970s, and the third extends from the 1990s to the present.

Feminism has altered predominant perspectives in a wide range of areas within Western society, ranging from culture to law. Feminist activists have campaigned for women's legal rights (rights of contract, property rights, voting rights); for women's right to bodily integrity and autonomy, for abortion rights, and for reproductive rights (including access to contraception and quality prenatal care; for protection of women and girls from domestic violence, sexual harassment and rape;for workplace rights, including maternity leave and equal pay; against misogyny: and against other forms of gender-specific discrimination against women.

An article by Pelle Billing in Mens News Daily, September 14, 2009 purports the results of the Stevenson and Wolpers study to be interesting in that it shows that as women have entered the workforce, their subjective happiness has declined. Contrary to what is politically correct, women were happier when they were housewives than they are nowadays. They explain these results in the following way:

1. Working outside the home is not as glamorous as feminism would have us believe. Many jobs are exhausting without offering a large monetary reward.
2. Many women are torn between the feminist expectation to work fulltime throughout life, and their own desire to work part-time when the children are small.
3. Young women are taught that they can have it all: a successful career, a loving relationship, beautiful children and interesting vacations. In reality, life is much more messy and you often need to sacrifice what is important to you in order to achieve something that is even more important to you. Impossible standards lead to unhappiness.

In addition, the researchers are saying, in effect, that women and men have had certain roles for thousands of years, and our biological and cultural makeup have adapted to those roles. Sudden changes to those roles may cause a stressful reaction in either sex, and according to this research women’s liberation has actually been more stressful to women than to men.


For more information on this topic, check out my series of articles on women's happiness at Hubpages

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Finding Your Passion: Dream the impossible dream

Recognizing the need for change

You are not born with passion. It is cultivated by your interests, what stimulates you, and excites you. It's the thing that makes you want to get up early, jump out of bed and start working; the thing that sustains you through hours of focussed concentration; the thing that creates that "flow".

But what if there is no passion? What if nothing particularly turns you on, so to speak. Maybe you'ld like to make a change. You hate your job, or have a lot of energy and time on your hands to devote to something fun and exciting, or maybe you're totally unmotivated and just don't know which direction will take you towards something more fulfilling in life. And you're asking yourself "What will make me happy?" What will make me jump out of bed in the morning, excited to go to work? What will get my juices going? What will make me lose track of the world and time, and bury myself in my work? In other words, how can I find my "passion?"

Looking for possibilities

If you’ve got a job you dislike, or even hate, this will sound like an impossible dream. And if you never put in the effort to find what you’re passionate about, you’re probably right; such a thing will never be possible. What you need to do is dare to imagine the possibilities. Dare to actually search for what you love. You just may find that it is not only a possibility, it's a probability. So, how do I go about finding this illusive thing called passion?

Well, first of all, you need to take a moment to reflect. Ask youself: Is there something I love doing; something that keeps grabbing my attention? something I love to readabout all the time?? What do I enjoy doing so much that I'd do it for free? Now, start brainstorming Make lists, research the job markets, look on the internet. Ask around. What are others doing? Get tested. Take a career survey or see a career counselor. Find your passion. It's there

Loving what you do

You really can make a career out of what you love to do. I have always loved to write, and yet the closest I ever got to it was majoring in English, taking writing classes, and teaching writing skills to high school students. I did play around with writing poetry and even tried writing short stories. But I never got serious about it. I taught school for 25 years, got a couple of degrees, wrote master and doctoral theses, even helped colleagues write theirs. And all this time, it never dawned on me that this was my passion. Possibly because there were so many other things I liked to do: taking photos, traveling, teaching, reading, cooking, drawing, painting & graphic arts. So many areas to consider for a life's career!

But I was brought up during a time when women either went to nursing school or studied to become teachers. It never dawned on me to try writing seriously, until I became an Innkeeper. I have owned a bed and breakfast (not a passion, by the way) for fifteen years. At this point, I have everything in place, including housekeepers, gardeners and maintenance men. So, I have the time to explore writing as a possible third career.

Turning Point
I spent Christmas this year with my daughter in Austin, Texas. Her boyfriend is a marketing director. While I was there, he was building a blog; I didn't even know what a blog was. Since it involved writing, I became interested in what he was doing. Seeing this interest, he suggested that I try it myself. Well, that did it! I now have three blogs, am writing for an on-line magazine, and for examiner.com. Am I getting paid for this? Not much; I'd do it for nothing. In fact, all I want to do is write! I write all day long, along with constructing a new website. I found my passion! And the irony? It was there all the time.

* first in a series on finding your passion

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