GoFaxer Blog

You’ve got one of those businesses that is so cutting edge, you’re constantly cutting yourself. Do you have Internet fax? Yes. Do you have an email savvy business? Yes. Do you have modern approaches to marketing and business management? You’re on your way to becoming a great big business.

But not yet. And because of this, you have to consider, that not only can rough times comes to an economy, but disaster can strike as well. I’m talking about natural disasters. But there is an agency that is there for you if you ever find yourself in a time of need.

It’s called the Office of Disaster Assistance. It’s been in place since 1953 and it’s there to provide low interest, long term loans for people and businesses after they’ve been hit by a disaster. You can find there website here.

Because when a disaster hits, and you’re trying to turn the lights back on in your office, you’re not as concerned about being cutting edge. You’re fighting for basic survival. So I think it’s good that there are Federal Agencies like this which help companies and individual residents get back on their feet, open for business, and stimulating the economy again.

I see time and time again how small businesses can get themselves into trouble by not having enough money to fund their operation. With great technologies like fax to email, most can figure out how to operate on much less money and infrastructure than is generally perceived as necessary.

But at a certain point all of that cutting back cuts into the bone and muscle of your business. At that point you know that you’ve got to get more cash to increase your effectiveness as a business.

In the past it was relatively easy to go to a banking institution for loans. But with the entire credit crisis in full sway, businesses are finding it much harder to get extra money, even with good credit.

The consequence to this dilemma is that many small businesses are turning to what’s called social lending or peer-to-peer lending or Banking 2.0. Sites that do this type of thing are Prosper, Lending Club, Virgin Money, Zopa, and GlobeFunder.

An article at Entrepreneur.com gives a voice of warning:

“Self-made billionaire and business coach Bill Bartmann says he’s borrowed more than $3 billion in past entrepreneurial ventures. Bartmann believes P2P websites may be the only loan opportunities for some small businesses as credit tightens. But before jumping into any agreements, Bartmann suggests entrepreneurs do their homework first.”

Ultimately, you need to be careful and think it through.  But this could be a viable option for your cash strapped business.

With the economy slowing, interest rates are dropping. Which means it may be the right time to do a prudent and smart loan. Whether that means buying a new house or getting a small business loan, the next few months will be a prime time for excellent rates.

My rule of thumb that I follow on credit, is that you should only go into debt on things where you’ll see a return on your investment. Homes, student loans, and small business loans are all examples of smart uses of credit.

An article at Businessweek.com points out that small banks are the best places to approach right now for loans.

“Subprime mortgage defaults have hit banking giants (BusinessWeek.com, 1/15/08) like Citigroup (C) hard, but most smaller banks don’t face the same losses. ‘Community banks have very solid balance sheets and liquidity. They’re not having to do the large writedowns for the subprime mess because they’re traditionally more prudent lenders,’ says Paul Merski, chief economist at the Independent Community Bankers of America, a trade group. ‘They have money to lend.’”

Of course, when you get your cash you will want to spend the maximum amount as possible on things that will actually make you money, like marketing and strong new employees. Don’t spend your money on more office supplies. So kick the fax machine and convert to Internet fax as soon as possible, and your new loan will have a maximum advantage.