Is financing proving difficult to come by? Maybe it’s time to get creative.
You don’t have to be a starving artist or a bestselling novelist. It’s not that kind of creative. It’s just doing something different than plodding down to the bank, filling out a bunch of forms and waiting for days, weeks or even months to get the approval you’ve been seeking. If, of course, you get the approval.
So how can you get creative? Here’s some helpful tips, courtesy of BizEngine and CNBC.
- Bring your product with you. If you have a monster truck repair shop, I wouldn’t suggest running over the bank/financial institution with one of your vehicles. That’s considered bad form.However, if you run a restaurant or other business with smaller, tangible products, bring some of your food/goods with you. Have something on hand that allows you to explain why your business is either unique, creative or just superb. If a loan officer can taste your homemade cupcakes, he’s got a better idea of why you deserve financing.
- Recognize the challenges of today. It’s like he says:“These days you’re more likely to win at roulette than to secure a business loan,” said Mike Michalowicz, entrepreneurial advocate and author of “The Toilet Paper Entrepreneur.”It’s far from impossible to get financing, however. You just need to recognize that there is a new paradigm at work, one that makes most lenders—but not all—slower to part with their money. To navigate this new strait of sorts, you need to look at the process in a different light.That means doing your homework. Talk to banks, lenders, friends and fellow businesses and find out who is lending, at what rates, and how quickly they were able to get theirs. If you’re going for a smaller financing amount and the bank is stonewalling you worse than Andrew Jackson, definitely consider checking out independent lenders, microloans or even angel investors. The point is to not limit yourself to the banks just because they’re traditional lenders, especially given their collective track record in the last few years.
- Stop obsessing over the interest rate. If you need to get working capital right now and you can get, as CNBC says, $50,000 at 12 or $30,000 at 8 percent, why settle for less capital than you need? That’s more likely to hamstring your business than an interest rate, especially if you urgently need the full financing amount to do a major overhaul of your location.Interest is certainly a factor, but it’s far from the most important one. Don’t let it stop you in your tracks.
Hopefully, those three tips will help get the creative juices flowing and get you one step closer to getting the financing you need. If you’re feeling conversational, tell us what strategies have worked for you!
Photo credit to GiniMiniGi at http://www.sxc.hu/photo/1128843
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