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Community Manager

Office Hours to discuss Financial Health Strategies to Reignite Your Business

As part of our #OpenWeStand initiative, please join the Next Street and GoDaddy teams to ask questions and see their insights into financial health strategies you can implement right now to reignite your business. We’ll be here available on Tuesday, June 23rd from 11am-12pm Pacific Time to answer your questions and share information. So please join us! #OpenWeStand

 

Here is the recording from the event!

 

 

RachelM - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.
46 REPLIES 46
Community Manager

How do I get a small business loan?

 

 

RachelM - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.

There are many factors to consider when looking for financing for your business, but there are a few key considerations you should be thinking about as you consider taking on new financing:
• purpose for the financing
• the loan amount
• the term (length, interest rate, monthly payment etc.) of the loan
• how this will affect your cashflow

 

The first place to start when looking for financing is your local bank branch, as they are heavily regulated and often have competitive terms. Beyond traditional banks, there are a number of alternative debt lenders that work specifically with small businesses.

 

Please check out our information on CDFIs and credit unions, which are non-profit lenders that specifically cater to small, local businesses. In any scenario, we suggest you connect with your local Small Business Development Center (SBDC) branch, as they will be able to help you step through the best financing options for your business in your area.

Small Business Expert
Super User II

Can you share with us the top 3 areas where you see small businesses get blindsided by financial issues and how to prevent that from happening?

 

Thanks!

 

Judith
"You have to be odd to be number one." Dr. Seuss

 

Hi Judith @Muse,

Thanks for your question! The top areas where I see businesses blindsided by financial issues are the following.

 

  1. Not having an emergency fund set up. Many businesses will not have any savings set up for an unforeseen issue. This may be a piece of equipment breaking, damage to inventory, or any other unexpected expense. Businesses, like consumers, should have a separate set account, or an accessible line of credit to for these situations. If these are not in place, this may put the future of your business in peril
  2. Not planning for future expenses. As your businesses grows as will your expenses. Sometimes businesses will grow too fast and this will lead businesses to either take on debt they cannot afford leading them into financial hardship down the road, or they turn down new opportunities. Building financial projections is a way to mitigate this risk and if you need help building these financial projections, your local Small Business Development Center (SBDC) as can help you build these.
  3. Taking on predatory loans. These are usually loans that are short term and have a high repayment rate sometimes over 60%. These loans are usually very easy to obtain and qualification is within 24 hours. When taking on a loan from an online lender, do your due diligence of the company and exactly what the loan is. For instance, may advertise that they 0% interest rate. While that is true, they may have fees that can be more than 30% of the total loan amount and are due as soon as you sign the contract. If you are looking for lending from an alternative lender please contact your local Small Business Development Center(SBDC) who will be able to guide you though the process.
Small Business Expert

@MattRevere   Good Stuff, Matt!  😉

 

Can you detail the services you offer that can help small businesses with their financial planning?

 

Judith
"You have to be odd to be number one." Dr. Seuss

@Muse Absolutely! Your local SBDC center, which you can find the closest location here  https://americassbdc.org/small-business-consulting-and-training/find-your-sbdc/  will be able to help you with the financial planning of your business. The SBDC core services are focused on three key areas that cover the needs of startups as well as those of established businesses:

  • One-on-one, confidential, free and long-term technical assistance.
  • Group training focused on subjects of interest to small businesses and presented by SBDC staff and private sector professionals.
  • Market research tailored to the client’s needs.

 

Small Business Expert
Community Manager

How do I know if my business is profitable? Do you have any suggested resources to learn more about business profitability so I can make sure my business can withstand the impact of future financial crises like COVID-19? 

 

 

RachelM - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.

Thanks for your question!

 

One of the best ways for businesses to understand if they are profitable or not is understand where the business is spending money where it is making money. You can be the most popular food truck on the block, but if it is costing you $3 to make a taco that you sell for $2, you may not be in business much longer. 

 

One of the easiest ways to keep track of your income and expenses is to build a Profit and Loss statement. A Profit and Loss (P&L) statement has two sections. The first section will show you exactly where you made money (revenues), broken down by products or categories. For instance, let’s say you own a bowling alley and you’d like to see where your monthly money came in. You can track this by what came in via bowling leagues, open play, or by private parties, for instance. The second section of a Profit and Loss statement will show where your money went (expenses). If you own a bowling alley, this may include, payroll, utilities, rent, inventory of food, and other expenses. After
both sections are complete, you will be able to see your revenues minus your
expenses, which equals your profits. This will show you how much profit you
made or lost for the month.


Many profit and loss templates are free online and can be updated monthly. New businesses may want to even update this daily.

Small Business Expert
Community Manager

Some of my customers are having trouble paying their invoices right now due to COVID-19. What suggestions do you have for me to ensure that I still get revenue from these customers but give them flexibility to pay me? 

 

 

RachelM - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.

There are a few ways to get creative with your existing customers to mitigate cancellations or defaults. Reaching out to existing customers directly, and offering flexible payment options, may allow them to pay you something instead of nothing. Some flexible payment options to think about when talking with customers:
• 0% financing options
• Payment extensions
• Offer gift cards or vouchers instead of cash refunds

• Using the “What can you afford” strategy with your most at-risk clients

Small Business Expert
Community Manager

I've gone to my bank to get a small business loan and they've turned me down. I'm super frustrated because I have bills and employees to pay. I don't need a ton of money but need help. What do you suggest I do? 

 

 

RachelM - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.

Absolutely, there are a number of funding sources outside of traditional bank loans. Crowdfunding and grants may be especially good options for your business, but the table below showcases a variety of options and the benefits of each. 

 

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Small Business Expert
Community Manager

What have you heard from your clients about how reopening their businesses is going for them? What's the biggest challenge and how are they coping with it? 

 

 

RachelM - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.

Hi Rachel,

                Thanks for the question. Reopening can sometimes be a difficult process as there are many factors to consider. One of the hardest issues we see to manage is employee retention.

        With employee retention, we recommend that businesses have open and honest discussions with their employees to gauge who is coming back and who may have moved on to a different career. The second is to see what level of staffing you will need at each stage of reopening. Once this is created you can then staff appropriately and ensure that the employees know exactly when they will be returning to work. We encourage business owners to start building staffing schedules two weeks prior for the staff to be prepared to be called in.  The main key here is to have open communication with your employees.

Small Business Expert
Community Manager

Do you have any suggestions on how best to track your business revenue and expenses? I want to make sure I'm set up in the future to better weather any financial storm that may come my way. 

 

 

RachelM - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.

It's so great to prepare your business for those "financial storms," and understanding revenues and expenses is an important step to doing that.

 

One of the easiest ways to keep track of your income and expenses is to build a Profit and Loss statement. A Profit and Loss (P&L) statement has two sections. The first section will show you exactly where you made money (revenues), broken down by products or categories. For instance, let’s say you own a bowling alley and you’d like to see where your monthly money came in. You can track this by what came in via bowling leagues, open play, or by private parties, for instance. The second section of a Profit and Loss statement will show where your money went (expenses). If you own a bowling alley, this may include, payroll, utilities, rent, inventory of food, and other expenses. After
both sections are complete, you will be able to see your revenues minus your
expenses, which equals your profits. This will show you how much profit you
made or lost for the month.


Many profit and loss templates are free online and can be updated monthly. New businesses may want to even update this daily. This is an example of one, but many other free tools exist online: https://www.santacruzsbdc.org/sites/default/files/SC%20Financial%20Template%202017.pdf 

 

Additionally, this webinar has a number of questions and tools to help you prepare for "financial storms" down the line: https://www.openwestand.org/next-street-and-godaddy-webinar-recap-strategies-to-reignite-your-busine...

Small Business Expert
Community Manager

Are Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL) still available for my business? Where do I go to apply?

 

 

RachelM - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.

Yes, PPP and EIDL loans are still available. PPP loans will be closing on June 30th! If you are still interested in applying for PPP, we encourage you to do it soon! You can search the full list of SBA-approved PPP lenders here.

 

The SBA has also resumed taking applications for EIDL loans and Advance Grants. Learn more and submit an application here.

Small Business Expert
Community Manager

Do I qualify for PPP if my company has no employees / I am a sole proprietor (or Single Member LLC)? What documents do I need?

 

JesseW - GoDaddy | Community Manager | 24/7 support available at x.co/247support | Remember to choose a solution and give kudos.

Yes, sole proprietors, or small businesses where the owner is the only employee, and Single Member LLCs are eligible for the Paycheck Protection Program (PPP). While you should check with your lender on its specific requirements, the below table illustrates guidance on commonly required documents for sole proprietorships, independent contractors, the self-employed, and single member LLCs.

 

Screen-Shot-2020-06-23-at-11.39.17-AM-1024x414

 

Small Business Expert