Tips for female entrepreneurs to secure small business loans

Securing a loan for your small business may not be as easy as you think. Many businesses apply for loans every day, but only a few actually get the money from banks and other lenders.

The business world today is still male dominated, and female entrepreneurs may find it tough to compete with male loan applicants. A study by the California Reinvestment Coalition found that business loans that are given to small enterprises owned by women in the state have dropped by 70% since 2007. But there is no need to worry, because there are a few things that you can do to improve your chances of getting a loan.

Build and maintain business relationships

When you approach a bank or a small-business lender, what they want to know is that your business is poised for success. The extent of the reach that you have within your local business community is an indication of how serious you are about your business, and how well connected you are. Female business owners must be serious about building trusted relationships within their business communities. If you find it difficult to get started, look for small business support groups in your locality or mentorship programs in universities. Many people who work in these organizations also have close ties with lenders. These connections may come in handy during loan applications.

Organize your financial records

If your financial information is disorganized, it can hinder the loan application process. It is important for banks and other lenders to thoroughly verify all the information that you provide via appropriate documentation. If you do not have the necessary documents handy, it can delay the process. It may come across to lenders that you’re either not serious about maintaining financial records, or worse yet, incapable.

Explore multiple options

Don’t just apply to one bank and forget about it. Explore all the different options that are available before deciding on the final one. Spend enough time shopping around for a lender who will suit your specific needs. Remember that different banks have different rates, and different preferences for specific industries or businesses. Find one that will give you the best overall relationship, rather than just the lowest interest rate. Also don’t neglect small-business lenders who are more likely than banks to give you the money.

Lending programs for women

Some lenders offer loan programs that are specifically targeted at businesses run by female entrepreneurs. These kind of lending programs make it a little easier for your business to get the money. Apply for general loans and as well as women-oriented lending programs to improve your chances.

When you approach the lender, make sure that you know exactly what you’re going to use the proposed amount for. Vague requests for a certain sum of money and poor planning are likely to put lenders off and get your loan request rejected. Be prepared with specific information to suitably impress.

Prepare well, keep all documentation handy, explore multiple lending options, and put some collateral aside. With some effort, you will be able to find a loan for your business.

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How small businesses can adopt sustainable business practices

Sustainability is not only about adopting green business practices, but is also a measure of the organization’s social and economic performance. Small businesses can especially adopt sustainable business strategies to improve profitability, customer loyalty, and commitment from their own employees.

The AICPA and CIMA, two of the most prestigious accounting bodies in the world, have released the report on the key elements to sustainable business practices in SMEs. Here are a few key points from that report.

Sustainability is not just about the environment

Very often, the word sustainability brings to mind green power, renewable energy, water conservation, and other environmental issues. But think beyond green business practices, and figure out creative ways in which your organization can act as a good corporate citizen for the benefit of all your stakeholders. Have open discussions with everyone, including suppliers and customers, and share information freely to come up with innovative solutions to improve efficiency and reduce waste.

Figure out what sustainability means to you

Write down a clear definition which communicates to everyone what sustainability means your company. This statement must be something that anyone can refer to, adopt the right goals for sustainability, and measure results accurately.

Communicate widely and involve top management

The measure of success of any strategy depends on who owns and writes it. The senior management must be actively involved in driving the policy, and must appoint the right sustainability champions who have the ability to communicate it throughout the organization, to every level.

Don’t attempt to do everything at once

Take baby steps. Becoming sustainable is not going to be an overnight transformation. Make small changes consistently and evolve to a more sustainable business over the course of a few years.

Don’t let sustainability be just a marketing campaign

Many companies make the mistake of jumping into the sustainability bandwagon only as a marketing exercise. It is easy enough to see through this “greenwashing”, and it can create an unfavorable impression about your company in the minds of customers, suppliers, and investors. Start talking about sustainability measures only if you are fully committed to the philosophy behind it and you’re prepared to do what it takes rather than just talk about it.

Track progress

You must measure, monitor, and review the goals of sustainability in order to justify it to the top management and to fully understand the benefit that it brings to the organization. It is important to develop clear and measurable metrics, and review them on a regular basis. This will help understand whether you’re making any progress, and in the goals are realistic and achievable.

Share best practices

Remember that you’re not alone in the sustainability drive. Actively engage with other organizations and industry initiatives to achieve sustainability goals together. Share best practices with other organizations that face challenges that are similar to your own.

Invest in sustainability more in terms of time rather than capital expenditure. Done the right way, sustainable business practices can truly push your business to another level.

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Mistakes small businesses must avoid when applying for a bank loan

Getting a loan for a small business takes a lot more than simply walking into a bank and walking out with cash. Banks are very particular about whom they loan money to, and you must create the right impression if they are to consider you.

There are a few common mistakes that small business owners tend to make while applying for a loan. Here are a few tips on how to avoid them and improve your chances of securing a loan.

Not knowing where you stand on credit rating

Before you begin the process of applying for a loan, understand what your credit rating is. Banks use credit reports to ascertain how you handle your credit. If your personal credit score leaves a lot to be desired, the assumption would likely be that you would take the same lackadaisical approach to business credit as well. Sometimes, a bad credit score may be caused by extenuating circumstances, but it is a real barrier to getting a loan for a small businesses. If you have bad credit, you may have to consider non-traditional financing options.

Providing vague financial statements

A bank is more likely to consider your application favorably if you have a properly structured loan file with an accurate balance sheet, income statement, cash flow forecast, and business and personal tax returns for the last three years. If you fail to provide proper details or the information appears vague, you are less likely to be approved for the loan.

Lack of a business plan or collateral

No bank will give their money away if they think that you do not have the ability to pay it back. In your loan application, mention in detail how you are planning to make the revenue for repayment. Also include details of collaterals. Explain how the loan amount will help your business prosper and the amount of money you expect to bring in.

Approaching the bank only for a loan

Banking, especially for small businesses, is all about relationships. A banker is more likely to lend you money when you have the need for it if they already have a relationship with you. Make it a point to develop that relationship in person by keeping in touch with the bank even when you have no need for a loan.

Applying only to the local bank

There are several lenders that are available if you’d only look. However, most small business owners approach only their local bank without shopping around for other lenders. The loan programs of Small Business Administration and credit unions are worth considering.

Having zero equity in the business

If you do not have your personal equity invested in the business, the bank will be less inclined to take on the entire risk and lend you the money. Make some investment in the business to communicate your commitment to the project.

Follow the above tips to significantly improve the chances of getting approved for a business loan.

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What Can Happen When You Try to Save Money On Accounting

Here’s what might happen when you try to save money by not hiring professional accountants for your small business.

Running a small business can be tough, and cost-cutting is one of the most common and difficult challenges that a small business owner will have to sooner or later deal with. Small businesses have to work within a limited budget and do not have the luxury of huge conglomerates with deep pockets. It can be very tempting to cut costs wherever possible, and professional accounting services may seem like an unnecessary expense.

Trying to do your own accounting or hiring the cheapest accountant in the market may seem like a good idea when you want to save money, but these tactics can backfire. Here are a few things that can possibly happen when you try to skimp on accounting.

You lose the peace of mind of working with a professional

It is understandable that you want to save money wherever possible and invest everything into the actual running of the business, but when it comes to getting an accountant, remember that you basically get what you pay for. Inexperienced and unqualified accountants tend to be cheap, so you may definitely save some money, but you will not have the same peace of mind that you would get from working with a seasoned professional. An experienced accountant who charges a higher fee may be able to work faster, and in the long run may even cost less.

Your bookkeeping suffers

If one of your employees has basic knowledge in accounting, you may think that it’s smart to put them in charge of bookkeeping. But the thing is, many in-house bookkeepers are clueless about what they’re doing. They may classify items incorrectly, used in appropriate headings, and may not be up-to-date on the latest accounting practices. At the time of tax filing, your accountant will end up charging you for correcting these mistakes and you may even include greater expenses in terms of both time and money to get the books in order.

You make unnecessary mistakes by doing it all on your own

Just to eliminate the expense of hiring an accountant, some business owners try and do everything on their own. You simply cannot keep books by throwing all your receipts into a shoebox. This often leads to the same disastrous consequences as having an inexperienced in-house bookkeeper. Not only that, when you do your own accounting, you may be unable to spend enough time on your core business.

You tend to leave it to the last minute

When you don’t have a professional accountant working for you, you may start going through and organizing your paperwork only at the last possible minute. When you let your paperwork get piled up like this, things can easily get lost, and you will also get so overwhelmed that you may simply give up.

By allocating a small budget for professional accounting, you will be able to keep your finances in order and also find enough time to take care of what really matters – running your business.

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How Small Businesses Can Compete With the Big Companies

Today, it is easier than before to compete with big businesses. Here are some tips to help you win the battle against Goliath.

Granted, big companies have deep pockets and elaborate supply chains that give them quite an edge over smaller players. But as a small business owner, you need not throw your hands up in despair and give up. Whether you are a service provider or a manufacturing company, here are a few ways for small businesses to effectively compete with the big boys on their own turf.


The websites of many big companies have a lot of revealing information about the business which can be of significant benefit to small businesses who aspire to learn from them. Shortlist a few websites that you want to keep an eye on, and check them every so often to find out if there are any changes. Encourage your employees to listen to the real-world chatter about your product as they interact with other people outside the company. This may help you discover a problem that no one else in the industry is addressing, or help you come by critical competitive intelligence that will give you an edge.


With the help of the product and market intelligence that you collect, see if you can do something that no one else in the industry has done so far. This is what JayBird, an earbuds manufacturing start-up, did to attract a large chunk of customers. They offered earbuds that repel sweat and a lifetime guarantee against sweat damage. This was a huge hit among their target demographic of sporty customers.


For a large company, a customer is just one among tens and thousands of others. As a small business, it is easier for you to really reach out and care for your customer. Focus on building personal relationship with your customers and effectively meeting their specific needs and desires.


A small business is in a unique position to offer tailor-made solutions to their customers. Be flexible in your approach and move away from a one size fits all solution.

Speed of communication In a small business, the decision-making process and hierarchy are likely to be much simpler than they are in a large firm. Since there are much less administrative hassles, it is easier to provide a faster response to customer queries or issue. Build a reputation for fast and personalized customer care, and you will soon build a loyal base of customers.


Small businesses typically have low overheads than the larger ones. This should ideally allow you to offer quality services at a lesser price than what a large company would be able to. You don’t have to sell yourself short; just bring your prices to a level where it attracts new customers and allows you to function without running into losses.


The Internet has come as a boon for small businesses who do not have the money to spend on color page advertisements or television ads. You can use digital marketing to your advantage. Reach out to your customers through your websites and social networks. The connections that you build online and the information that you gather can give you a distinct advantage over your competition.

Small businesses, precisely because they are small, have the ability to be nimble and quick because they are not bogged down by several layers of administration and protocol. This, combined with deep knowledge about your competition, can help you compete effectively with larger firms.

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Book Keeping Basics for a Small Business

Many small businesses and start-ups are second to none when it comes to producing great products and building a strong presence in the market. However, the same thing cannot often be said about their bookkeeping practices.

Why you need to keep your books?

Bookkeeping is just a way to keep track of your income and expenses, which consequently
improves your chances of making a profit. It also helps you collect and organize all the
financial information that is necessary to file various tax returns appropriately and on time. Obviously, it also enables the IRS to evaluate your operations.

You don’t have to be a qualified accountant to do basic keeping. Here are a few
bookkeeping basics to help you maintain proper financial paperwork for your small

As long as you have adequate records that reflect the income and expenses of your
business, you can keep them in any way that you like. Depending on how big your business is, you can either maintain your books on your own ledgers or use an accounting software.
There are three basic steps to keeping your books

  • Keeping receipts of every payment and expenditure
  • Daily, weekly, or monthly summary of your income and expenditure records
  • Creating basic financial reports that provide key pieces of information about the business

Keeping your receipts

Every purchase and expenditure of your business must be backed by a record of receipt
which lists out the amount, date, and other relevant information. You can either keep all
your receipts in a shoe box, or record it in a software system. Choose a method that suits
your needs. If your business is very small, you may just need to collect all your receipts in a box file and not splurge on other complex filing systems.

Summary of revenues and expenditure

You must maintain a periodic summary of income, expenditure, and other financial
information that you are keeping track of. These summaries are later used to create specific financial information about your business.

Make it a habit to post to the ledger on a regular basis, say daily, every Friday, or at least
once a month. Post the receipts by entering the amount indicated in the physical record into the ledger. This is called ‘posting to the ledger’. Your posting schedule depends on the number and frequency of your sales and expenditures, and how detailed you want to keep your books. A busy business may want to use a cash register and post daily sales, while a smaller business can get by with a weekly or even monthly posting. There are accounting software programs which will generate its own ledgers when you enter relevant information.

Creating basic financial reports

Financial reports are key because they reveal key aspects of the financial health of your
business. You may have an income ledger which tells you that your business brought in a lot of money, but unless you measure it against your actual expenses you wouldn’t know
whether you made a profit or loss. This is why you need financial reports which combine
crucial data from multiple ledgers to give you an overall view of what is happening in your business. The basic reports that you need to create on a regular basis or cash flow analysis, profit and loss statement, and balance sheet. Using a software makes it easy to generate these reports.

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What Does it Take to be a Certified Tax Accountant (CPA)?

8169560070_290a4e1fc4_bTax accounting is a specialty in the field of accounting, one of the fastest growing occupations in the United States. According to the Bureau of Labor Statistics, job opportunities for accountants are projected to grow at 13% from 2012 to 2020. Certified tax accountants advise clients on their tax liabilities. Accountants choosing this specialty can expect to earn a yearly salary of $50,000, even in the first year of their job. Becoming a certified CPA is a smart move to bring home a good pay package, and to enjoy job security. Here is what you need to do to become a certified tax accountant.

Educational Requirements
A tax accountant must have the basic qualification of a bachelor’s degree in accounting or business. To improve your chances of employment, go on to complete your Master’s degree in business administration or accounting. You will need a four year accounting degree, and also take the certification exam. Most tax accountants who do well are Certified Public Accountants who have a Master’s degree.

You must pass the CPA exam to become a licensed professional. You may practice tax accounting without being a CPA, but most tax accountants go through this licensing process. The exam is tough and requires serious preparation. The test is conducted by the American Institute of Certified Public Accountants. Check out the AICPA website for more information on the exam and how to prepare for licensure.

Skills Needed to Become a Proficient Accountant
Accountancy is all about number crunching, so it goes without saying that you should have a natural aptitude and affinity towards numbers. With a general understanding of how numbers work, and excellent skills for communicating to your clients what the figures mean, you will be able to make your mark in the field. Tax accountants must also be very detail oriented and pay attention to minutiae. Dropping even a single number or a decimal place can have serious consequences during tax preparations.

Accountants will be required to work on sophisticated accounting software, so it is essential that you be comfortable with computers. More than all the technical capabilities, a good tax accountant must also have the ability and willingness to communicate effectively with clients who are seeking help. You must also ethically uphold all the tax regulations applicable.

What do Tax Accountants Do?
Tax accountants offer specialized tax advice to both individuals and businesses. As a tax accountant, you will be involved with calculating tax liabilities of your clients and figuring out ways for them to reduce their taxable amount. You would also complete tax forms to ensure filing on-time. Business tax accountants would be involved with higher-level strategic and financial decisions of the organization, such as what type of investments should a company make, where they should build new facilities etc.

Tax accountancy is a field with a lot of growth opportunities. It is easy for tax accountants to find a job in law firms, government agencies, and accounting firms. You may also choose to work as an independent contractor if you want to have some flexibility in the workplace. Tax accountants typically make more than other accountants, so it is an excellent specialization option to consider.

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5 Small Business Accounting Mistakes that May be Costing You Money

Head in HandsDuring the early years of operation, many small business owners make easily avoidable bookkeeping mistakes which end up costing them money. These simple mistakes are often made because of lack of awareness about proper accounting procedures.

A typical small business owner has no time or inclination to an expert accountant, but he
can still take the necessary steps to avoid a few key pitfalls which may negatively impact the company’s bottom line. The following are some of the accounting mistakes that a small business owner must try and avoid.

Mistake 1: Not hiring a professional
Small business owners are often short on cash, so it is no surprise that they try to do everything on their own. But the truth is, not hiring a professional to do your taxes or bookkeeping can cost you big money down the road. An experienced professional can help you take advantage of the ever changing tax laws and also plan ahead for potential changes. The accuracy of your financial paperwork also has a significant impact on the success of your small business.

Mistake 2: Not keeping track of receivables
You may be doing a lot of business, but if you’re not getting reimbursed within a reasonable timeframe, the business might soon be run into ground. When you sell a product, you issue an invoice and record a receivable. When the customer pays you money, it is recorded as receivable paid against the invoice. Many business owners usually leave the customer payments to be reconciled at a later date, and come tax time they are left with a bunch of payment receipts and a receivables report that makes no sense.

Follow up on your receivables and mark payments against invoices regularly to save yourself time and money. Consider using online payment and cloud accounting services to automate your receivables process.

Mistake 3: Not keeping receipts for small purchases
You may be keeping the receipts for all major purchases, but are you doing the same for small purchases as well? It might not seem like big deal if a couple of cab fare receipts are missing, but these things can add up. Also, you really don’t want to be in a position where you are unable to show proof for expenses claimed in your tax return. Make sure that you have the proof to back up every penny that you claim as expense.

Mistake 4: Not hiring full-time employees
Hiring full-time employees is definitely a more money intensive exercise than hiring independent contractors. But if all your employees are independent contractors, you may have to schedule your work around their availability and how much work they are willing to take up. You have to file Form 1099-MISC if you pay independent contractors. If the IRS decides that you have incorrectly classified an employee as an independent contractor, you may attract penalties.

Mistake 5: Not keeping your books current
The first few years of any business can be a mad rush, but if you neglect to keep your books current it will only worsen the situation. If you’re unable to keep proper records, then it is a clear indication that you need to hire an accountant. An experienced professional can catch costly errors right at the beginning, and help the business operations run more smoothly and efficiently.

These accounting mistakes can happen to anybody, but if you’re aware of it and prepare accordingly, you will be able to maximize the efficiency and profitability of your small business.

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How Working With a Professional Accountant Can Benefit Your Company

Every business, regardless of what size it is, needs a professional accountant who will
provide valuable financial advice throughout the year, helps file taxes and other paperwork, and even play the role of a business advisor or consultant.

Many small firms feel that they don’t really need an accountant, or that they cannot afford
one. Some others also mistakenly assume that all that accountants do is just fill up a few
forms at the end of the year. The truth is, a qualified Certified Public Accountant (CPA) can not only help you with filing taxes, but also save money in the long run.

Here are some of the ways in which working with a professional accountant can benefit your company.

Pay just the right amount in taxes
Filing taxes is not just about filling up forms. Not only do you have to complete the forms
accurately, but you must do it in a way that minimizes your tax bill. A good professional
accountant will help you understand the different legal ways in which you can minimize
your tax bill. The tax planning service offered by accountants is one of the biggest benefits
you can gain from them. The accountant will help you take advantage of the tax laws and
also offer advice throughout the year to operate the business in a way that gives you the
best tax advantages. It’s like having your own personal financial advisor throughout the

Save time
Your proficiency lies in running your business, not navigating tax laws. If you spend your
valuable time working on your company’s financial accounts, you’re taking that time away
from your business – time that you could spend to earn more money. Forget the opportunity cost, working through your accounts as a non-expert may even cost you more money because you may miss certain things that would be glaringly obvious to an experienced professional accountant.

Grow the business
For any business to grow in the right direction, you need to take strategic business and
financial decisions. Especially in the early stages of business, you need to be particularly
careful about making the right decisions. Good accountants will work with you closely and help your business succeed. They can also draw on their experience and suggest solutions to your business and financial problems. Since accountants usually have close contact with other professionals such as lawyers, bankers etc. they can put you in touch with them to sort out issues that are beyond their scope.

File all the paperwork accurately and on time
If you send in paperwork with incorrect or incomplete details, you may be asked to submit it again with the correct details. If you miss a deadline for filing your tax returns or other important documentation, you may attract a fine. You really do not want your forms to be sent to a tax inspector who will go through it with a fine tooth comb. You can avoid all this by using the services of an accountant who will ensure that the right forms will be completed accurately, and will be filed at the right time.

A good accountant may cost you money, sure, but can you really afford not to have one?

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Tips for Small Business Tax Planning

Many small business owners find the current tax system challenging, and that owning a
business is sometimes more expensive than being paid a salary as an employee. But with proper tax planning, small business owners can have a hassle-free experience when
they file their yearly or quarterly taxes. Here are a few tax planning tips for small businesses to set themselves up to be in the best possible position for next year’s taxes.

Maintain excellent records on a daily basis
It is very important to keep track of all the cash that you bring in and all the cash that you
spend. Maintain your records from the very first day of starting a business. There are many good accounting software programs that are available to keep track of all your transactions. Keep all receipts and invoices of business operations and expenses. Ensure that the receipts and invoices match the entries in the accounting program. Do this, and you will no longer dread the year-end tax time.

Hire a qualified accountant
Hire a Certified Professional Accountant who will offer valuable financial advice on how to plan your taxes, and also take care of the actual filing of paperwork. Remember that

inaccurate or inappropriate filing of taxes can attract stiff penalties and unwanted attention from the taxman. As a small business owner, you may not have the time or expertise to dig through your company’s accounts. A qualified professional can make your life easy when it comes to tax planning.

Take advantage of all business expenses and tax deductions
Businesses can deduct a wide variety of expenses such as rent, advertising, travel, software, commissions, etc. In order to be considered deductible, a business expense must be both ordinary and necessary. There are many deductions that are available to you which you may not know about. Take some time to research different types of deductions that are allowed for small businesses, such as home office deductions, automobile deductions, entertainment expense deductions etc. Your CPA will be able to help you identify these expenses. Maintain records for all of these.

Check if there are any business tax credits that are available to you
As a small business owner, a business tax credit can be quite valuable to you. For example, if you offer insurance to your employees, you may be eligible for tax credit for up to as much as 50% of the premiums that you pay. There is also the work opportunity credit if you hire individuals from a certain groups with high levels of unemployment. Work with your CPA to find out all the tax credit opportunities that are available to you.

Classify your business appropriately
Different types of businesses attract different tax liabilities and rates. Do some research to decide which type of business entity is the best option for you. Sole proprietorship, Limited Liability Corporation, partnership, C Corporation, S Corporation etc. are some of the options.

Buy assets to save on taxes
Whenever you buy new software, furniture, technology, or equipment for your small
business, keep detailed records and save all the receipts in order to claim expenses on your tax return. Section 179 of the IRS code helps small businesses by allowing them to deduct for depreciation in one year rather than over several years. Tech assets purchases can be written off up to $250,000. There might be several assets in your company that are eligible for a section 179 deduction. Use them to your advantage.

Make sure that all your records are up-to-date and accurate so that you can minimize your tax bill. You can learn more about tax planning for your small business from the IRS website.

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