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Small Business Financing Methods

Small business financing comes in a number of different forms. Typically, when an entrepreneur wants to start a new business then they approach their local bank as it relates to receiving a loan in order to launch their operations. However, obtaining a loan from a bank comes with a number of risks. As we have discussed before, you are almost certainly going to need to provide a personal guarantee as it relates to receiving the capital that you need for your new business venture.

Second, you may need to provide your home, car, and retirement accounts as collateral as it relates to your loan. As such, the risks related to this type of financing are extremely high as it relates to your personal financial situation. We strongly recommend that you speak with your certified public accountant as well as your financial adviser before you undertake a large debt obligation in order to launch or expand a new business venture. We are going to continue to touch on the subject of the risks relating to small business financing as we write about this subject.

Of course, and as we have mentioned before, you can always seek the assistance of a private investor as it relates to financing your business operations. However, there are significant risks involved when you are working with private funding sources due to the fact that they can take control of your business very quickly. As such, we recommend that you speak to your lawyer before you begin the process of raising capital from a private investor. This is not only due the risks that you business may face as you seek this type of funding, but also because you are going to need to comply with a number of securities laws as you obtain capital from private sources. Additionally, your legal counsel will be able to provide you with a tremendous amount of guidance as it relates to negotiating a proper deal with an angel investor or outside funding source.

Finally, all types of small business financing comes at a cost. Whether you are going to have to pay a significant amount of capital for a loan or sell your business to a third party there are issues that you are going to need to confront as it relates to your cash flow. One of the other things that we constantly recommend is that you develop an appropriate profit and loss statement and cash flow analysis that you can use to determine the cost of capital as it relates to your business venture.

Doing Business Online SWOT Analysis

More savvy business owners are now discovering that having an easily navigable website, utilizing Web 2.0, finding customers through social marketing tools, and implementing an aggressive article marketing campaign is one heck of a rock solid marketing plan.

Not only does a thorough web marketing plan give you an automated way to increase your business sales, it is also extremely cost effective when you consider the benefits.

But if there’s one thing you’ve probably learned in the course of running your business, it’s that there are two sides (maybe three or four!) to every scenario. Just like with any other business decision, setting up and maintaining an online presence comes with its challenges. It’s time to do a quick SWOT analysis — here we’ll identify both the power and pitfalls of using the Internet for your business.

Strength in Automation and High ROI
The most attractive benefit of establishing yourself online is that you are setting up an automated source of income for your business. You know, just like they say in the infomercials “set it and forget it.” You wake up in the morning and money is waiting in your inbox.

Let’s also consider that the return on investment (ROI) when making your business Internet-ready is usually quite amazing. Isn’t ROI one of the most important considerations when you’re operating a business? You need only come up with an amazing idea, make the one-time investment in a beautiful, user-friendly website, hire someone to take charge of your online marketing and pay a writer to maintain your content on an ongoing basis.

Then simply wait for business to start rolling in.

Depending on your product or service and how skillfully you set up your Internet campaign, you can easily see an ROI of 100% or more in just the first few months of being online.

Weakness — Web Vulnerabilities
With the advent and growth of the World Wide Web also came the rise of Internet thieves, hackers, and scammers. Many experts agree that the Internet is not always a safe place to entrust your personal information.

As a merchant, you constantly have to be concerned about hackers tapping into your customer’s private information (and guess who may be ultimately responsible if this happens?). Not to mention, being that you have pretty much made your business accessible to anyone on the globe, you are going to have to deal with supposed “customers” who are intent on wasting your time with questions or looking for freebies.

Thankfully, there are a number of ways to protect yourself and your business from scammers who are looking for an easy way to attack your business for their own financial gain. Several trusted companies offer active online protection for a monthly or yearly fee. Contact forms and automated responders allow you to weed out the folks who aren’t very serious about using your services.

Threats from Online Competitors
One detail that you simply can’t overlook is this: you are definitely not the only one in your industry who has considered the profit potential of setting up shop online. You are constantly going to need to be on the lookout for online competitors. For example, the fight for keywords and search engine ranking is one of the most prevalent forms of online competition. In some situations, the market is highly competitive.

It is your responsibility to stay ahead of the game with new and innovative approaches that will solidify your online presence. For instance, many online marketers are now seeing the full value of long-tail keywords for their article marketing efforts instead of continuing to compete for high demand one or two-word keywords.

Opportunities Abound
The O and the T of this SWOT analysis were switched around for a very important reason. We want you to be highly optimistic about launching an online presence despite the threats. As a business owner, you’re a risk taker, no? You certainly didn’t let the fear and challenges of starting a new business hold you back, and selling or marketing online should be no different!

Don’t hesitate to unlock the remarkable opportunities that come with selling on the Internet. New innovations are being developed every day to help businesses like yours excel online — the prospects are limitless. Adding an online element to your company is a powerful way to grow your bottom line and stay up to date, especially since nowadays the definition of a strong business seems to change as frequently as the seasons.