Did you know that

• Uneven cash flow is the #1 financial problem businesses face today?
• Over 80% of all commercial bank loan applications are denied?
• 8 out of 10 businesses lease all or some of their equipments?
• Accounts receivable financing (factoring) is used more than all types of business financing combined?

Of all that ails small businesses, the most deadly is lack of money. Typically, in order to relieve the grief of insufficient capital, business owners have sought loans to meet operating demands and provide for future growth.

More business owners opt for bank loans because it is widely assumed that it is the only other practical option other than equity financing. A recent informal survey of business owners who sought funds from elsewhere revealed that they prefer bank loans principally because:

1. They trust banks.
2. Bank loans provided cash-on-demand after approval.
3. The costs of bank funds are usually less than the alternatives.
4. Supposedly, banks provided better customer service.

Historically, banks have provided the bulk of funds for business and still do. Once, they were truly the champions in providing funds less expensively and with exceptional customer service, but that is not necessarily true anymore. If over 80% of bank loan applications are denied, where should businesses turn?

Absent a business loan, there are other viable, albeit less known business funding options. Moreover, there are other significant factors to consider when seeking funds from elsewhere, as shown on the following table.