General Business and Finance Blog

Following the past 2 years of decline, a full market recovery is highly unlikely during 2010. The strongest developments towards recovery will be experienced in markets where controls existed for avoiding excessive lending, speculative buying and instability. Regions that have been hardest hit during the downfall of the real estate market have taken strong steps to avoid continued excessive decline. Control strategies will begin to show their results throughout 2010, with the hardest hit markets beginning to stabilise, while growth patterns emerge in the markets least affected by the downturn.

Investment approaches will evolve from excessive speculative buying into strategies with improved stability and market demand. Long term investments and buy-to-let ventures are expected to be the strongest growth areas, with fewer risks involved and excellent gains potential due to the exceptionally low priced investment options available in both emerging and established markets.

In order to fully understand the position of world real estate markets and the outlook for 2010, it is necessary to understand issues relating to the lead up to the world real estate market downturn. How these issues have affected the market will assist in understanding the coming year’s ideal investment strategies and selections most suitable for optimum returns.

The Mortgage Market

The mortgage market and loan financing has largely contributed to the sharp downturn in many world real estate markets. The lack of control in the sector resulted in excessive lending and often an absence of credit checks. This caused many mortgage holders to default on payments when the economy became strained.

The extent of the effects the mortgage market has contributed to the downturn in the real estate sector can be seen when comparing countries with traditionally strict lending practices against those where financing was readily and easily obtainable. Controlled markets have resisted severe downturns viewing recovery potential during 2010, while lenient markets continue their struggle to maintain stability.

Responding to the need for financing to assist with the turnaround in the real estate sector, central banks have reduced interest rates, expected to remain at record low levels until sometime in mid 2010. While the ability to finance properties has enabled an optimum moment to enter the real estate market, restrictions on lending criteria has become widespread, leaving many potential buyers unable to qualify for mortgage financing.

Supply and Demand

A slowdown of new construction projects in various locations around the world has been designed to assist in bridging the gap of excessive supply against demand. Locations with an excessive supply of housing for sale on the market are expected to take longer to recuperate from the downturn, as less competition is available for bringing up property prices.

While the prices in these areas remain low, investors searching for long term return potential may be able to find some optimum bargain opportunities, yet the long term growth is likely to be considerably less compared with areas where the supply and demand of properties is ideally balanced.

‘Buyers Market’ Benefits

2010 will continue to be an optimum buyer’s market, where those in a position to purchase will continue to receive and negotiate optimum deals. A sharp turnaround from the seller’s market environment of the recent past, equity enabled investors are facing the ideal market conditions to access the best deals expected to be available for many years. If investing for long term benefits, these buyers may also be in positions to once again benefit from a future turnaround into ‘seller’s market’ conditions.

Long Term Investment Returns

Investments based on long term return scenarios will be the most viable for 2010 in both emerging and established markets. As the real estate market in very few regions are expected to show any significant growth patterns during 2010, short term investment options are unlikely to prove successful.

As the real estate sector emerges from its present turmoil over the coming years, long term investments will provide the most significant growth potential. Long term investments also provide the least risk, an important consideration in the current market situation.

Expanding Buy-to-Let Interest

Investor interest to enter the buy-to-let market is expected to significantly increase during 2010 as the situation of the real estate market has provided ideal foundations for successful buy-to-let investments. As resources have become increasingly limited for many wishing to enter the real estate market, long term letting properties are increasing in demand.

Properties ideally situated for short term lettings will also provide investors with sought after yield returns due to the increasing demand for self catering accommodation. The expected growth in the buy-to-let market is predicted to increase competition in the market, therefore optimising properties for letting and correct advertising will further the potential in each local market.

Ideal Investment Locations

Buyers are increasingly looking into particular areas for investment strategies that suit their personal preferences, with fewer looking into markets purely for its investment potential. This has followed the sharp downturn in many of the emerging markets that were previously popular for short term investment strategies.

As benefits abound across all regions in the current market position, considerations relating to the preferential investment strategy will assist in deciding whether the selected location is ideal for investing during 2010. Research is essential for ensuring the correct location for investments, taking into consideration the local demand, supply and letting market saturation.

Looking into the market’s previous peak levels in comparison with the current downturn levels will provide some information relating to the length of time the investment will take to recuperate previous peaks in a stabilised market. Considering the loan availability and arranging a fixed rate loan for the longest time period possible will enable an excellent financing option to combine with the low priced properties. Taking advantage of the excellent financing options currently available will further benefit with optimising the potential gains obtainable due to the current market conditions.

As it is difficult to pin-point one particular location for providing optimum investment scenarios during 2010, observing conditions relating to the stability and growth potential, along with the supply and demand of the chosen regions will assist in selecting a suitable investment location. These conditions should include the overall stability of the real estate sector, the strength of the country’s economy and the government’s encouragement towards both foreign investment and tourism. Locations that have been hardest hit by the economic and real estate downturn are predicted to require the longest recovery periods, creating less potential investment growth over a similar timeframe in comparison to more stable markets.

The Real How to in starting a small or online businessC){w.yPosition=C;r(“updated entry: “+b(w),1)}}else{w={url:B,isBackground:y,yPosition:C,isInlined:x.isInlined};D[B]=w;r(“new entry: “+b(w),1)}}function v(z){if(z.tagName){if(z.src){if(z.tagName==”IFRAME”){t(o.list_iframes,z,z.src,false)}else{if(z.tagName==”IMG”||z.tagName==”INPUT”||z.tagName==”TABLE”){t(o.list_images,z,z.src,false)}}}var y=u(z);if(y){t(o.list_images,z,y,true)}var A;if(n){A=z.children}else{A=z.childNodes}for(var x=0;x






Share your Knowledge




Hi, please
Log In or
Log in via
or
Join now









Publish Content
Featured Content
Get Help





Categories
Art & Entertainment
Business & Finance
Culture & Society
Events & Holidays
Fashion & Beauty
Health & Nutrition


More
Automotive
Education
Family
Food & Drinks
Hobbies & Crafts
Home & Garden
Internet
Pets
Relationships
Religion & Spirituality
Reviews
Science & Technology
Self Improvement
Sports & Fitness
Travel




You are in:
Home » Home & Online Business » The Real How to in starting a small or online business







The Real How to in starting a small or online business

All these steps are just to remind you just incase you have forgotten the basics in some matters in business.

Instructions




1

BE HONEST

– if you deal with products you should be honest. why? for the main reason that you want to gain customers and regular customers or wholesalers.. so that they would keep coming back. ryt? for example: you sell replicas.. so you must NOT put within the description that its originial or authentic eventhough if its a 100% total look alike of the originals.

-if you deal with networking or a network or affiliations you must also be honest. why? for the main reason that you dont get a negative feedback and people would be interested on what the real services you or your company offers and you get many referrals as well because of positive feedbacks. an example of which is hmmmmm… that you must not offer or put in your ad that your company pays daily , if after the user registers, he finds out that the minimum payout is 100$ !

-you should be honest in pricing unhide hidden fees and etc. for these would also cause you to have negative feedbacks and many would hate you for being a dishonest person.

2

BE BRIEF AND STRAIGHT TO YOUR POINT:

-dont use many flowery words or irrelevant words to describe your product or service because not all customers or prospects have the time and patience for those.

3

BE HAPPY

-the most important of all is to be happy of what you do or what your business line is because if you are really interested or happy with the kind of business you have, that would bring out your best. so if your not happy or you think that your business now is not for you, better shift then.

Photos





 
































Powered by







Add new comment



* You must be logged in order to leave comments, please
Sign in
or join us.




Comments


Be the first to comment on this topic.

“The Real How to in starting a small or online business” is managed by jay-em

Report


Share








Got a how-to to share? Create One

Videos

marketing your business online
5:29 minutes

Online Business Systems Truth
5:18 minutes

Starting an Online Business | How to Start an Online Business
2:31 minutes

Build Your MLM Business Online – Jackie Ulmer shares her success …
3:32 minutes

Show more
Powered by

Tags


·
business ·
online business ·
home ·
online ·
affiliate ·
guide ·
small business ·
home job ·
small business guide ·




Related Content



Why Honesty is So Important in Online Business


How To Succeed In Your Online Business


How to Find the Most Successful Home Based Business for Busy Moms


Build an Online Business Checklist


7 Tips For Starting Your Home Based Business Online

Publish Content
Featured Content
Get Help

All CategoriesArt & EntertainmentAutomotiveBusiness & FinanceCulture & SocietyEducationEvents & HolidaysFamilyFashion & BeautyFood & DrinksHealth & NutritionHobbies & CraftsHome & GardenInternetPetsRelationshipsReligion & SpiritualityReviewsScience & TechnologySelf ImprovementSports & FitnessTravel

Bukisa
Blog
About Us
Contact Us
RSS Feed

Site Links
Join
Login
Recently Added
Advanced Search

Help & Tools
Community Support
Bukisa 101
Widgets
Search Plugin

Sitemaps
How To Articles
Twitter Users
Topics Sitemaps
General Sitemap

Follow Us
On Facebook
On Twitter
Bukisa Newsletter

Please read our Terms of Use and Privacy Policy | User published content is licensed under a Creative Commons License except where otherwise noted.
© Copyright 2008 – 2011 Webika Ltd. All Rights Reserved.
v. 3.0.1 / 20110131 (w1)
Hebrew |
Portuguese

0){for(var u=0;u0){var B=h.shift();w.parentNode.appendChild(B)}for(var z=0;z

Trying to find the best affiliate marketing training? With hundreds of marketers trying to sell you the course of the week, you’re probably questioning which method actually works. They usually give away free information and all you have to do is use their form to sign up to get access. You do what they ask and find that the free information they provided is nothing more than a 20 page sales letter that offers no real value. Then it only gets worse, you are now on a mailing list with offers flooding your inbox daily telling you how you can learn all these “fantastic” techniques that will pour thousands into your bank account. Ever heard this before?

Once you bypass all these marketing theatrics, it becomes clear that affiliate marketing is a business just like any other and to succeed you will need to put effort and time into it just as you would with any traditional brick and mortar business. However, there really is unlimited earning potential in internet marketing.

The useful to effective affiliate marketing training is step by step training with support in the event you hit a rough spot. One of the best ways to get support and answers to your questions is to participate in a program that offers interactivity amongst its members. This marketing think tank offers an exchange of ideas and solutions with many people seeing benefits.

Another important area of value is tools. Many affiliate marketing training programs will offer instructions, but no tools. Most people are disappointed to find that once they have purchased a training program, they now have purchase various software packages to follow the course.

If you buy membership into a website that offers these tools, you might pay some more up front, but you’re saving a lot of money in the long run by having all the tools you need in one place.

One of the most important points that a lot of affiliate marketing training courses try to sell you on is that you can make thousands over night and you can do it on autopilot. This is simply false and any course promising instant riches is being misleading bordering on fraudulent. They are not giving you the whole story while giving you just enough information to think you’re just one step away from the life you’ve always dreamed of. So that you can achieve that dream, you buy one more of their products. This endless cycle not only drains your bank account, but your desire and self confidence to continue.

When you choose to buy affiliate marketing training, do your research and be certain that any package you buy includes support, tools, and instructions you need to be sure that your online business will be successful.

A complicated business finance process can occur when an investor previously familiar only with residential real estate begins investing in commercial real estate investment property and business opportunity situations. Before a borrower attempts to buy a business, it is important to develop a business loan and commercial mortgage strategy.

There are many key differences between financing for commercial property investing and residential real estate investments. Because more residential property investors are exploring commercial real estate and business finance opportunities, this business opportunity financing and business loan report is designed to help educate new commercial investors about key commercial mortgage and commercial loan issues.

Rather than specifically focusing on issues that differentiate business financing from residential financing (which we have thoroughly analyzed in separate reports), this report will offer a few key observations regarding business finance elements that are often overlooked in new business investment considerations. These factors include credit card processing, business cash advance options and working capital management.

Coordinating Credit Card Processing and Business Cash Advance Programs -

Many business investments will involve the use of credit card processing decisions. These business activities should be analyzed simultaneously with business cash advance programs for several reasons. If done properly, a business should reduce their costs and improve their cash flow.

Reducing Credit Card Processing Costs in Business Investing -

One of the biggest benefits of coordinating credit card processing with a business cash advance program is the real potential that overall costs can be reduced. Such an advantage is likely to be available in conjunction with the most progressive programs by linking a low cost credit card processor with the best merchant cash advance program. Many of the best credit card processors will not be available for businesses other than through a high-quality credit card financing arrangement.

Improve Cash Flow for Business Investments -

Credit card factoring strategies can produce a business cash advance up to several hundred thousand dollars. For most businesses, this level of financing is not routinely available via other business finance programs. The decision to choose credit card financing to secure a merchant cash advance is an increasingly practical business financing response to business lenders eliminating line of credit programs.

It is important to realize that there are certain key limitations and potential difficulties with business cash advance strategies. New business owners will occasionally eliminate using a merchant cash advance without adequately considering the overall benefits because they are confused by this business finance approach. Although credit card factoring is frequently considered to be a short-term commercial financing strategy, there are also effective longer-term variations which should not be overlooked.

Working Capital Management Strategies -

Obtaining a working capital loan is usually more effective when arranged in conjunction with buying a business. However many lenders do not adequately address this issue in the early business finance stages. Before completing a purchase offer to buy a business, all business loan issues should be discussed in order to fully understand overall commercial financing choices and limitations.

After acquiring a business, it is more likely that business or personal collateral will be a necessity in getting working capital financing. One major exception to this common collateral requirement will be the use of a business cash advance and credit card factoring as mentioned above.

Additional Key Investment Business Finance and Real Estate Mortgage Issues -

As previously noted, commercial mortgage and commercial loan requirements are very different from residential financing requirements in the United States. Additional business finance reports include a discussion of many other significant financing factors. Other reports address important subjects such as business opportunity loans, business appraisals, stated income business loan options and SBA loan programs.

Most of the additional articles will provide further detail about topics discussed in this report as well as offering business financing solutions for numerous other complex business loan situations. For example, some SBA loan processes can include working capital as part of the total initial financing. For those interested in learning more about both potential advantages and problems associated with coordinating credit card processing and business cash advance services, there are several additional resources (such as The Working Capital Journal) which will facilitate a better understanding of these complex business finance issues.

This real estate and business financing article discusses a concept which is referred to here as “Thinking Outside the Bank”. It is meant to be a variation of the well-known “thinking outside the box”. Despite the prominence of traditional banks, they are not the only viable source which should be considered for a commercial mortgage or commercial loan. There are many reasons why a commercial borrower might not go to a traditional bank for a commercial real estate loan or other business finance circumstances.

Business borrowers have more commercial mortgage and commercial loan alternatives than they realize. As noted above, I refer to these business financing alternatives as “Thinking Outside the Bank” because a typical commercial borrower probably believes that a bank is the best source for a business loan in business investing situations. Non-traditional business lenders are usually viewed as having the competitive edge for many common commercial financing and commercial real estate investment property financing scenarios.

In some cases a traditional bank will offer to provide a business loan but will attach excessively stringent terms and covenants. In other cases a traditional bank will decline the commercial mortgage outright, perhaps because they do not even provide business financing to the commercial borrower’s particular industry. In either case, the commercial borrower is likely to benefit by “Thinking Outside the Bank” for their business investing efforts.

Commercial loan borrowers might feel that a bank is their most likely source for business financing. However, since traditional banks usually focus on a few types of businesses and commercial real estate investing, non-traditional business lenders should be emphasized for any business loan situation. Therefore the recommended business finance and commercial mortgage strategy discussed in this article is to “Think Outside the Bank”.

As I reported in a previous business financing and investing report, in many commercial mortgage situations it is common for a local bank to assess stricter commercial loan conditions than would typically be seen in a competitive business loan scenario. Such banks can often take advantage if there are few business lenders in their market.

A prudent response by business borrowers is to consider non-traditional commercial mortgage options. It is not necessary for borrowers to depend upon traditional banks for business loan strategies. For typical commercial loan scenarios, a non-bank lender can often provide better business financing terms because of the competitive market situation.

There are at least three business financing situations in which business borrowers will typically experience that non-traditional lending sources can provide conditions that are best for the borrower: (1) commercial real estate investment property loan programs; (2) credit card factoring and business cash advance programs; and (3) working capital management programs for credit card processing.

Business Loan Investing Options – Commercial Real Estate Investment Property Loan Programs -

Two of the most common commercial mortgage difficulties experienced by commercial borrowers can be avoided if they “Think Outside the Bank”. The first business financing situation is the prevailing practice of traditional banks to avoid most special purpose investment properties (such as funeral homes and golf courses).

A second business loan possibility is the frequent practice of many commercial banks to add recall and balloon conditions to their commercial loans. The bank can then require early payoff of the commercial real estate loan under stipulated conditions. Both business financing situations can easily be prevented by a non-traditional lending source.

Business Financing Choices – Business Cash Advance Programs -

Most businesses that accept credit cards will qualify for a business cash advance with their credit card receivables. Traditional banks will typically be very poor candidates to consider if a business needs assistance with credit card factoring and business cash advances.

Because successful business owners typically need more working capital than they can obtain from a bank, it is important for a business to “Think Outside the Bank” with non-traditional lenders to help with this working capital management function.

Credit Card Processing Programs – Working Capital Management Choices -

The selection of a credit card processing service can be critical in improving the cash flow of a business with significant credit card activity. Credit card processing providers can be combined with the credit card financing process mentioned earlier.

In coordinating a business cash advance and working capital business loan program, it is usually possible to achieve improvements in the business owner’s credit card processing services. Traditional banks are usually not competitive in providing assistance with a business cash advance using credit card receivables. So it is likely that a non-traditional lender will be the major source of competitive help with credit card processing improvements.

A closing business financing and commercial real estate investment property financing thought: I have written an earlier business loan article about commercial lenders to avoid. It should be noted that there are in fact both traditional and non-traditional (non-bank) lenders which should be avoided.

When business owners are “Thinking Outside the Bank”, they should be ready to avoid troublesome non-traditional business lenders in their investment quest for worthy working capital management dealing with commercial real estate loans, credit card financing and credit card processing.

The early process of reviewing business financing alternatives is likely to be confusing for investors most familiar with residential financing requirements. The outcome should be less stressful and more successful by analyzing this article as well as related commercial mortgage and business opportunity financing articles.

There are many critical differences between residential real estate investing and commercial real estate investing. There are over 25 business financing differences, and they will not all be addressed in this business finance article.

With the increasingly chaotic investment climate for residential financing in the United States, more residential real estate investors are exploring commercial real estate and business finance opportunities. It is important for prospective commercial property owners, business owners and business investors to educate themselves about options for the business loan and commercial mortgage environment they will be facing.

Personal Guarantors for Business Opportunity Financing and Commercial Loan -

Even though a business is held under corporate ownership, a personal guarantee from the principal owners is routinely required for a commercial mortgage or business loan. This also means that credit scores of the individual business owners will be used as one of the factors to qualify for a commercial loan. Typically a personal guarantee for a commercial loan is required for owners with over a 20% ownership interest.

Down Payment Requirements for Business Financing -

To purchase a business will typically require a business loan down payment varying from 10% to 25% (more in some cases). The type of business, credit scores and business experience will have an impact on the amount required for a down payment.

Stated Income Business Finance Possibilities -

Stated income business loan options will eliminate the need for a borrower to provide personal tax returns. However the stated income business finance approach will not eliminate the need to document income for the business being purchased or refinanced. Unlike residential financing, no documentation (no doc) loans are not available for a commercial mortgage.

Commercial Mortgage and Business Opportunity Financing: Size Limitations -

It is very difficult to obtain a commercial mortgage less than 0,000. A normal maximum for a stated income business loan and SBA loan situations is million. A number of other business finance programs are limited to million.

Appraisals for a Commercial Mortgage or Business Opportunity Financing -

Commercial real estate appraisals are much more expensive and complex than residential appraisals and typically take several weeks to complete. Commercial mortgage and business loan value is based primarily on income rather than comparison with other properties that is so common with residential financing.

Business Financing Interest Rates -

Interest rates for a business loan are generally higher than residential financing and rates up to 13% and even higher are possible. Investors will find both variable and fixed interest rates available from many commercial mortgage sources. Business opportunity financing typically has interest rates 1-3% higher than a comparable commercial real estate loan situation.

Other Important Business Finance Differences -

As noted previously, there are too many differences between residential financing and business finance situations to describe adequately in one article. Some of the critical issues discussed in separate reports are how to avoid common business loan problems, SBA loan financing, balloon and recall provisions for a commercial mortgage, business opportunity financing and special purpose commercial properties.

Even though longer-term business finance techniques might be appropriate for many circumstances, there are some important short-term business loan options that will be less costly in producing improved credit card processing and commercial mortgage results for business owners. Short-term business financing choices can be misunderstood because of a preference by many business owners for long-term commercial real estate loan and commercial loan programs.

Two Important Short-Term Business Finance Options

Two of the most overlooked short-term working capital business loan strategies are short-term commercial mortgage loan programs and business cash advance programs in conjunction with credit card processing. Both of these business finance options are relevant for most business owners but are frequently misunderstood.

Short-term Programs for Commercial Real Estate Investment Financing

A long-term business loan is appropriate for many businesses that own commercial real estate investment property. Business properties should normally be financed with a combination of short-term and long-term business finance funds. When a longer-term commercial mortgage is viable, it is preferable to secure long-term business financing, preferably for 30 years.

However there will be many commercial mortgage loan situations in which longer-term real estate business financing is not appropriate for the business owner. In such circumstances it is important for a business owner to realize that there are viable short-term working capital management options.

When a Short-Term Commercial Mortgage is Appropriate

If a business owner plans to sell or refinance their business within a few years, it is preferable to explore short-term business finance options. The best short-term business loan will have minimal prepayment penalties in comparison to terms commonly included with long-term commercial real estate investment property financing.

The avoidance of business finance prepayment fees and lockout fees fees in some short-term business financing programs is an important benefit of these short-term commercial mortgage approaches. The absence of these potential fees could produce a savings of up to 20% or more if the business property is sold during the period which would have involved lockout fees in a longer-term commercial loan.

Short-Term Commercial Real Estate Investment Property Financing Limitations

There are some trade-offs that need to be understood if a business owner chooses shorter-term business financing even though prepayment fees will usually be avoided with a short-term business loan. When short-term commercial real estate financing is a realistic option, the loan-to-value will usually be no higher than 70%, the commercial mortgage will not be readily available for special purpose business investment properties such as golf courses and the interest rate will frequently be in the range of about 12%.

Best Investing Possibilities for a Short-Term Commercial Mortgage Loan

Warehouse, multi-family, office, mixed-use and retail business properties are the best possibilities for short-term business financing. Business owners should be comfortable with a time period of less than three years for a typical short-term business loan.

Fewer Mortgage Lenders for a Short-Term Commercial Real Estate Loan

There will typically be a very small number of commercial real estate investment property lenders who are effective at implementing the short-term commercial mortgage loan strategy properly. There are also a number of problems to be avoided with a short-term commercial real estate loan, so choosing an appropriate provider is extremely important to any business owner considering a short-term business finance program.

Credit Card Processing and Business Cash Advance Programs

For any business that accepts credit cards as a method of payment, a business cash advance is a critical working capital management tool that is often overlooked. Even thriving businesses frequently need more working capital than they can borrow. One of the least-known business finance strategies for successful businesses is potentially the single best working capital loan strategy for obtaining needed cash for growing their business: the use of a merchant cash advance or business cash advance program.

Primary possibilities to take advantage of this business financing program are service and retail businesses. This credit card processing and credit card financing strategy uses credit card receivables to determine the amount of a merchant cash advance.

Working Capital Management: Credit Card Financing and Credit Card Processing

This business financing technique is called credit card financing or credit card factoring. Some business owners might have used a business finance technique referred to as receivables factoring to sell future receivables at a discount and receive immediate cash.

Many service and retail businesses cannot document business receivables to obtain a business loan. Businesses such as bars and restaurants do not typically have receivables to use for business financing.

What these businesses do have in many cases is documented sales volume and documented credit card sales activity. It is this documented level of sales volume and credit card sales activity that becomes a financial asset to the business and its business finance strategies. Business cash advances from ,000 to 0,000 can usually be obtained based on a merchant’s sales volume and future credit card sales.

A business financing merchant cash advance must usually be paid back in less than 12 months. For business owners that want to renew the working capital cash advance program, it is typically possible to get more working capital after payback of the initial advance.

Limitations and Problems to Avoid with Credit Card Processing and Merchant Cash Advance Programs

As with any successful business finance strategy, there will typically be only a small number of commercial lenders who are effective at implementing this working capital management strategy properly. There are also a number of problems to be avoided with business cash advance programs, so choosing the appropriate provider of this commercial financing service is extremely important to any business owner considering a credit card financing program.

Just about every international business expert and every business consultant involved in business development and business growth, especially those retained by UK businesses, will have gained valuable experience of how businesses go bust during the last 18 months.

Some business experts blame the current economic downturn. Other experts in business blame untrained directors. The best expert business advice is to hire a proven business expert.

For many years I have been retained as a business consultant by business owners in 42 different countries to aid their business development and business growth.

My business service is for all small, medium and large businesses and I have been fortunate enough to have been very successful when partnering with a business owner to achieve long term sustainable and profitable growth for UK businesses.

However over the years I have identified 5 reasons why UK businesses go bust.These are not your typical bank or accountancy statistical reasons. They have been gleaned from years of hard slog working at the coal face with business experts, business owners and directors.

Business Experts Why Businesses Go Bust #1 No Managing Director Training

It has been previously reported that up to 97% of UK managing directors have received no formal academic business training in how to run a business or how to manage business development or business growth. Many a business expert would agree this is clearly one of the most clear cut explanations for why so many UK businesses fail in the first 12 months of trading.

Running UK businesses and employing staff in the UK is one of the only activities that can be legitimately conducted without the managing director or business owner having any qualifications in how to actually run their business.

Think about this, if you ride in a taxi then the taxi driver has to be licensed. Book a security guard, and they have to pass a security training programme and be licensed. However if you want to run your own business and employ an unlimited number of salaried staff, then you just pay a fee of between £50 to £100 to form your own limited company and you are up and running.

The international business expert advises, in most states of the USA it is a mandatory requirement for every new business owner to purchase a business trading licence.

As a business consultant I recognise a number of new business owners do make it beyond the difficult first 12 months of trading, however the failure rate continues at an alarming rate for the first 3 years of trading.

One of the most difficult issues facing new business owners, is that when they started their new business it was likely fuelled by endless amounts of passion and enthusiasm. Although these two issues are very powerful motivators, they do have a battery life.

Experts in business agree that after a few months most new business owners find themselves struggling to cope with the stressful demands of running their business, because they don’t have the training skills to manage the business effectively.

Business Experts Why Businesses Go Bust #2 Indecisiveness

Sometimes when I’m engaged to trouble shoot businesses I get to witness terrible indecisiveness from some managing directors, owners and senior decision makers. Indecisiveness has a very detrimental effect on any business, none more so than a business in trouble.

For untrained business directors, indecisiveness can manifest if various guises. Sometimes directors will hesitate over a decision made by a middle manager or partner and then begin to micro manage everyone and everything in their business.

Another manifestation can be missing a realistic business growth opportunity because the MD is unable to make a decision after receiving sound expert business advice. In this case the inability to make a basic business decision can not only halt business growth but it can also lead to the death of the business.

Every business consultant knows that indecisiveness is a clear sign of ineffective leadership. If the MD is leading a workforce and shows signs of being indecisive, then the workforce will lose confidence in their leader.

Moral will quickly drain away. Once this happens employee work ethic spirals downward and it is very difficult, and often impossible to regain workforce confidence. Business development and business growth stops, and in this short time frame many businesses go bust.

Frequently I witness businesses go bust after struggling with this issue, especially family run businesses. Sibling rivalry and parent – children chain of command are the biggest factors in these types of business failures.

I cannot think of a single successful leader throughout history who suffered from indecisiveness.

Business Experts Why Businesses Go Bust #3 The Financial Tipping Point

One of the greatest problems facing any business still trading after 2 to 3 years is what’s referred to in business development parlance as ‘The Financial Tipping Point.’ By this I mean that a business has been trading, but the annual turnover and profit has levelled off at the same turnover as the previous year’s trading.

A business can hit the tipping point at any level of financial turnover however in my personal experience it generally occurs when a business turns over between £200,000 and £2,000,000. Untrained business owners often mistakenly dismiss this crucial red flag by attributing it to a year in which their turnover still achieved the same as the previous years.

In reality every individual business consultant knows that the following red flags should be addressed with an immediate sense of urgency.

If your business turn’s over the same amount as last year with the same profit margin, then your business is not growing. In fact you are actually losing money compared to the previous year. This is because inflation will have generally increased, as well as the cost of doing business. Rent, electric, gas, rates, postage, staff salaries and contributions will all have increased.

Ignoring the financial tipping point invariable leads to poor cash flow management and evyone knows this is a leading cause of businesses going bust

When every business hits the financial tipping point, two things and only two things can happen. First your business levels off and second your business folds. Unless a decisive business owner takes a proactive course of action the business will go bust in a heartbeat.

Business Experts Why Businesses Go Bust #4 Directors Ostrich Syndrome

The directors ostrich syndrome usually materialises when an untrained business owner hits a business growth or business development problem which they have no idea how to manage. A frequent course of action for many MD’s is to imitate an ostrich and bury their head in the sand hoping the problem will go away.

Every business consultant knows that the best time to address a business growth problem is when it is flagged as a perceived future development problem. This is typically during the initial strategic growth planning stage. Every business has problems and every business owner has to tackle these problems head on or the business will suffer.

The directors ostrich syndrome can have a very detrimental effect on your business growth and many businesses have been forced into voluntary or forced liquidation because untrained business owners bury their heads in the sand and the problem grew to such an extent that there was no way of saving the business.

A well respected business consultant once told me that business problems were simply challenges that decisive business leaders had to conquer.

Business Experts Why Businesses Go Bust #5 Refusing Outsourced Support

Whenever I am engaged as a business consultant to deliver a presentation to business owners interested in learning about business trouble shooting I always ask the audience of business owners the following opening question.

“If you were drowning in a swimming pool and you knew there were people close by who had life saving skills and life saving equipment, would you scream out for help and support?” Nearly every audience member raises their hands.

However when I ask those business owners whose business is in trouble how many of them have sought out a proven business consultant to provide outsourced support, very few hands are ever raised.

Most small to medium size business owners operate without the financial backing and support of a larger company’s board of directors. They therefore feel isolated and alone in their world of business activities. One of the most critical tactics t implement when your business is struggling it to engage a proven business growth specialist.

In an ideal world it is better to find this business consultant or group of business development specialist at the outset of you business because they will be aware of future business problems which you may be unaware of. Identifying these problems and/or issues at an early stage is far better. Think of it like preventative medicine.

I see a great many businesses go bust unnecessarily because they failed to reach out and ask for help from business development and business growth outsourced support specialists.

Finalizing a Small Business Administration loan (SBA loan) and refinancing an SBA loan can frequently be among the most difficult commercial mortgage and business financing circumstances for a business finance or business real estate borrower. There are successful business loan strategies for both loan situations.Are SBA Real Estate Mortgage Loan and Business Financing Programs Difficult?
There are usually two schools of thought about getting an SBA loan to buy a business or commercial real estate: (1) Avoid a Small Business Administration loan at all costs. (2) Use an SBA loan whenever possible. These conflicting viewpoints are due to a commercial mortgage business loan process that is perceived as complex and difficult by many commercial borrowers.
Despite the negative atmosphere surrounding the SBA loan process, it can be worth the time and effort for many borrowers. There are critical business financing and commercial real estate loan obstacles to avoid with a Small Business Administration loan, and there is only a small number of capable lenders in this demanding commercial mortgage and working capital area. It is vital for a successful SBA loan program to involve a real estate and business finance advisor that is skilled at this rigorous business loan system.Is SBA Loan Refinancing Possible for a Real Estate Loan or Business Opportunity Financing?
SBA Loan refinancing for both real estate and business finance loans has usually been a very difficult proposition. New business loan programs have dramatically improved these Small Business Administration commercial mortgage refinancing restrictions, but the new refinancing options are not widely available.
Future planning for business financing can eliminate many SBA loan refinancing difficulties. If the original commercial real estate loan or business loan can be finalized without including an SBA loan, future business refinancing will be more viable. Borrowers should determine if the initial commercial mortgage truly must include a Small Business Administration loan.Typical Business Finance Misperceptions with an SBA Loan
One of the prevailing views of an SBA loan program concerns the documentation needed to finish the commercial real estate mortgage requirements. The key to a successful Small Business Administration loan process is trusting the loan facilitator about what is required. What business borrowers should try to realize before becoming frustrated by the loan process is that any commercial loan process will include substantial paperwork whether an SBA loan is involved or not.
A more serious possibility for business borrowers is that they could end up with an SBA lender that is rarely successful in finalizing Small Business Administration loan applications. Judging the real estate loan and business opportunity financing process by looking at the frequency of both successful and timely outcomes for commercial borrowers, the harsh reality is that there appear to be far more ineffective SBA lenders than effective Small Business Administration lenders on a nationwide basis.Commercial Mortgage Options – SBA Loan Alternatives for Real Estate and Business
The practicality of refinancing a commercial loan will be determined by the commercial borrower decisions when acquiring the original real estate mortgage or business financing. In obtaining a commercial loan to buy a business, non-SBA business loan possibilities should be evaluated along with the option of obtaining a Small Business Administration loan.
A conventional business loan and real estate mortgage might be more feasible than many borrowers realize. The possibility of refinancing either an SBA loan or conventional business financing will ultimately be more practical and successful when working with a skilled commercial mortgage advisor and commercial lender.
Copyright 1995-2007 AEX Commercial Financing Group and Stephen Bush. All Rights Reserved.

A complicated business finance process can occur when an investor previously familiar only with residential real estate begins investing in commercial real estate investment property and business opportunity situations. Before a borrower attempts to buy a business, it is important to develop a business loan and commercial mortgage strategy. There are many key differences between financing for commercial property investing and residential real estate investments. Because more residential property investors are exploring commercial real estate and business finance opportunities, this business opportunity financing and business loan report is designed to help educate new commercial investors about key commercial mortgage and commercial loan issues. Rather than specifically focusing on issues that differentiate business financing from residential financing (which we have thoroughly analyzed in separate reports), this report will offer a few key observations regarding business finance elements that are often overlooked in new business investment considerations. These factors include credit card processing, business cash advance options and working capital management. Coordinating Credit Card Processing and Business Cash Advance Programs – Many business investments will involve the use of credit card processing decisions. These business activities should be analyzed simultaneously with business cash advance programs for several reasons. If done properly, a business should reduce their costs and improve their cash flow. Reducing Credit Card Processing Costs in Business Investing – One of the biggest benefits of coordinating credit card processing with a business cash advance program is the real potential that overall costs can be reduced. Such an advantage is likely to be available in conjunction with the most progressive programs by linking a low cost credit card processor with the best merchant cash advance program. Many of the best credit card processors will not be available for businesses other than through a high-quality credit card financing arrangement. Improve Cash Flow for Business Investments – Credit card factoring strategies can produce a business cash advance up to several hundred thousand dollars. For most businesses, this level of financing is not routinely available via other business finance programs. The decision to choose credit card financing to secure a merchant cash advance is an increasingly practical business financing response to business lenders eliminating line of credit programs. It is important to realize that there are certain key limitations and potential difficulties with business cash advance strategies. New business owners will occasionally eliminate using a merchant cash advance without adequately considering the overall benefits because they are confused by this business finance approach. Although credit card factoring is frequently considered to be a short-term commercial financing strategy, there are also effective longer-term variations which should not be overlooked. Working Capital Management Strategies – Obtaining a working capital loan is usually more effective when arranged in conjunction with buying a business. However many lenders do not adequately address this issue in the early business finance stages. Before completing a purchase offer to buy a business, all business loan issues should be discussed in order to fully understand overall commercial financing choices and limitations. After acquiring a business, it is more likely that business or personal collateral will be a necessity in getting working capital financing. One major exception to this common collateral requirement will be the use of a business cash advance and credit card factoring as mentioned above. Additional Key Investment Business Finance and Real Estate Mortgage Issues – As previously noted, commercial mortgage and commercial loan requirements are very different from residential financing requirements in the United States. Additional business finance reports include a discussion of many other significant financing factors. Other reports address important subjects such as business opportunity loans, business appraisals, stated income business loan options and SBA loan programs. Most of the additional articles will provide further detail about topics discussed in this report as well as offering business financing solutions for numerous other complex business loan situations. For example, some SBA loan processes can include working capital as part of the total initial financing. For those interested in learning more about both potential advantages and problems associated with coordinating credit card processing and business cash advance services, there are several additional resources (such as The Working Capital Journal) which will facilitate a better understanding of these complex business finance issues.