Did your small business loan application recently get turned down? You're not alone.
Despite the number of United States financial institutions claiming they want to lend to small businesses, one-third of small businesses can't get the funding they need, according to the National Small Business Association's 2010 Year-End Economic Report (via Business News Daily).
You have a great new marketing plan that you want to put into action. You want to give your computer equipment a makeover. You think taking on an extra staff member will help your brand. Unfortunately, you can't employ any of these ideas or initiatives because you can't get the funding.
Low Credit Scores Holding You Back
One of the main reasons why small businesses can't receive the necessary funds is because of poor credit scores. Since the financial crisis, a lot of small business owners have been under a considerable strain. From focusing on mortgage payments to ensuring customers continue to purchase their products, some entrepreneurs may have had to do some things that may have diminished their credit scores.It is very important that small business owners regularly monitor their credit - this can be done by organizations like Equifax, Experian and Transunion. Not tracking your credit score could very well undermine your efforts to attain business funding for short-term repairs, long-term investments and interior upgrades.
Because of low credit scores, many small business loan applications often get denied. This, of course, can turn into a problem for companies that are struggling or under serious pressure to remain open. Even with a poor credit rating, incorporating a few strategies into your business model can give your score a boost of 100 points or so within just six months.
Here are four ways to improve your credit score:
- Establish a business credit history.
- Pay your bills on time.
- Monitor your business credit file and update it.
- Keep track of your customers' and suppliers' credit.
Alternative Funding Options Can Help You
In today's economic landscape, there are plenty of alternative funding options available that don't necessarily focus on credit scores. Although there are many solutions for small businesses, one of the most popular financial tools for entrepreneurs is a merchant cash advance. This alternative funding for business option is quickly becoming an important monetary instrument for smaller companies.
Unsure what a business cash advance is? Here's a simple explanation: it's when a business is provided with a lump sum cash payment and in turn the company sells a fixed-dollar amount of future receivables (SEE: How to Fund Business Growth With Future Receivables).
Unlike the process maintained by conventional financial institutions, the application process for business cash advances is less stringent, easy to understand and the cash can be received very quickly.
Check out Quikstone Capital Solutions, learn more about business cash advances and apply for the cash you need today. Get the funding needed to stay afloat and compete with your rivals.
