Oh no, not again. Yes, that’s right, I’m not going to go there… at least not for today. There’s no shortage of excuses and reasons why small businesses can’t get approved for business loans. It never fails to amaze me the coverage this topic gets especially when the national economy goes into recession or when major political races are at stake. Yes, I agree that small business growth and success is the economic back bone of the US and also, that more than 60% of the US workforce are employed by small businesses. But where I get off the group think is when it comes to the lack of financing for a small business with a business loan. In this article, let’s explore the REAL REASON that small business don’t qualify for loans and the truth may even surprise you.

It’s Deeper Than Statistics
I love numbers and even better, I love reading financial statements and the notes. The love for numbers did not become a passion for me in the world of small business lending until I came to understand that the financial statements tell the story of a business. Similar to the story behind the financial statements, there’s a story behind the statistics stating that small business owners can’t get approved for loans especially if they’re of a certain ethnic group, gender, and / or industry. I’m not completely washing away the reality that there’s a shred of discrimination in our world… hey, we live in a broken society with broken people. However, a large part of this thinking (small business owners can’t get a loan because of skin color, gender, etc) is just simply untrue. I’ve been on both sides of the fence so to speak in the world of small business lending. I’ve worked for a big bank, and I’ve worked for a not for profit community development financial institution and it’s always the same. The number one reason why small business can’t (and don’t) get approved for loans is due to the considerably large operating risk that exists in these businesses.

Operating Risk: It All Starts with You
What does operating risk mean? Well, here’s a question to bring some clarity. What speaks more to sustainability: a business that’s been operating for at least one year or a business that’s still in the owner(s) mind? I’d go with the first option. Operating risk means that you have and continue to execute on your business plan(s) and that the business is cash flow positive (i.e. returning a sustainable profit margin to cover costs and make you money). Here’s the sad truth: not many small businesses get to this point. Most if any, within two years are still trying to figure things out. OK, granted, there are levels to this particularly when you observe the diversity of businesses. However, I’m speaking to the ones that endeavor to obtain a business loan.

In closing, I offer a couple of ways to minimize your operating risk and increase your chances of getting approved for a loan. (1) Grow tough skin and learn to survive. The game of business is one of survival. Most days, things will not go your way and you just have to stay the course, be adaptable, and stay true to the business mission. (2) Never forget the 3 P’s – Production, Processes, and Personnel. Become efficient in the production of what you offer for sale, create and put in place processes to enhance production efficiency and ultimately the customer experience, and finally, hire, train, and invest in people who share your vision for the business.

Once you’ve chosen to get ongoing in a home based business you’ve got a lot of choices to make, and the prevalent one is… what company to become a part of? In this piece of writing we’ll be talking about ways that you can discover the home based business that’s correct for you!There are numerous different elements to finding the right home based business, product, compensation plan, up front cost, time commitment and choosing an up line or sponsor. These 5 factors are key in finding the home based business that is going to allow you to be successful.First let’s talk about product. All home based businesses offer some kind of a product or service that you’re going to be marketing. If a company DOESN’T have a product that is a big red light it means the
company isn’t legit and you shouldn’t even contemplate it.When it comes to choosing a product you’ll want to locate something that you are passionate about and that you can market with enthusiasm. If you don’t actually like the product or service you’re marketing you won’t be any good in the business… period. Sure you may be able to market it
for a little period but after a while you’ll grow tired of pushing product you don’t believe in on people.Figure out if you want to market a physical product or some kind of service. You don’t have to comprehend everything about the product but it is always beneficial to find out if it really has value and is going to be good for the consumer. Once you’ve found the product or type of product you’d like to market you’re on to question number two… compensation plan.There are a lot of distinctive compensation plans out there in the home based business industry. Some are good quality and some are GREAT. Some are intended to allow you to make a lot of money up front and others are more tailored to building a steady stream of income that will be around
for a very long time.So when looking at a compensation plan you’ll need to ask yourself this… how much money do I need to make up front to be pleased? Talk to people that have been in the business formerly and get testimonies to find out if the compensation plan really delivers and then start thinking about number
three… up front or start up cost.Whenever I chat to people about a start up cost they usually get a little spooked at this time. The certainty is that any LEGAL business costs capital to establish. A job you get for free but a business will always cost money, that’s just how it is.You’ll want to figure out just how much funds you are willing to invest in a business up front. A home based business can cost anywhere from $50 – $5000 an it’s a totally personal choice how much you want to expend. Sometimes the $50 company can be just as rewarding as the more expensive
one… but it’s all up to you.If you are married you will want to sit down and talk to your spouse about just how much money you can allow to invest again, it’s a personal judgment that has to be made by you and you alone.The fourth thing you’ll want to think about is time. How much time are you willing or able to invest in a business up front. Some home based businesses are more part time than others.In some companies you’ll need to spend just a few hours a week to see success in others it will be more like a full time job. Like the question of money only you can decide how much time you are really able to spend on a home based business in the opening stages. Also feel free to ask the person in the business you are thinking about joining how much time you will in fact need to spend to be profitable.Finally there is the problem of picking the right up line or sponsor for you. Like the other questions this is a very special issue that only you can really determine, but finding someone that you like and
admire is very important.You want to work with someone who is going to invest some time into making sure you are as equipped for success as possible and most significantly you want to work with someone who has the expertise and the know how to show you exactly how to become profitable.If you answer each of these questions and take your time you will have no problem finding the home based business that is exactly what you need to become tremendously successful. Follow your instincts, do your research and there is no uncertainty you will be on your way to a flourishing career working from home.

Affiliate programs are great home based business opportunities for the entrepreneur, and there are several different types of affiliate programs available. The simplest of the business as you, the affiliate, placing an advertisement like a banner ad, graphic, or text link on your site for the business you are trying to promote. What makes these programs nice home based business is that you earn a commission on the sales or clicks that the advertisement generates. Other affiliate programs get a little more complex with multi-tiers and proportions of sales. Still, the money you generate makes affiliate programs effective business income opportunities.Other benefits of these business income opportunities include the fact that you do not have to create your own service or product. You get to take advantage of these home based business opportunities by advertising someone else’s services or products. Also, you do not have to worry about storage, shipping, or collecting payment from customers. With these home based business, a high proportion of your program revenue is profit. However, there are some negatives to relying on programs as business. Since you are just the affiliate program, your business opportunities will not earn you a major portion of the sales revenue, and you make commission. This means that you will not make as much money with these business as you would selling your own product or service. Sometimes programs are a great way to start off with home based business income opportunities so you can get some business savvy before branching out on your own.So, how do you know with progrms will be the best business for you? Start off by taking a look at the programs that will work best with your website. This means that your business should complement the content of your website and fit in well. Also, you need to make sure that you find quality home based business income opportunities, because you only want to be a part of an program that makes you look reputable. There are plenty of reputable programs available, so look for the best quality home based business income opportunities where the company is stable and you get a signed affiliate agreement.There are plenty of great affiliate programs available that can offer you effective business opportunities. However, you need to make sure you are working with a reputable programs that are known as quality home based business income opportunities. Also, know that, despite the money you can make in affiliate programs, your best home based business income opportunities are those where you sell and market your own service or product. Still, affiliate programs can be a great way to gain valuable experience and a great share of revenue from the product or service. So get out there and find a great program.