Category Archives: Small Business & Industry News

Small Businesses Borrowing More

Small Business & Industry News

Article from NBC NEWS:

Good Sign for Economy: Small Business Borrowing Rises – In good sign for the economy, small business borrowing rose to its highest level in almost seven years in December, an index shows.

U.S. small businesses boosted borrowing in December, pushing a broad lending index to its highest level in nearly seven years and signaling that economic growth may continue apace in the early part of this year.

Small companies typically take out loans to buy new tools, factories and equipment, so more borrowing can be an early signal of increased hiring ahead.

The Thomson Reuters/PayNet Small Business Lending Index, which measures the volume of financing to small companies, rose to 121.6 in December from an upwardly revised 114.6 in the prior month, PayNet said on Tuesday.

That was the highest level since March 2007, the data showed, and was up 5 percent from a year earlier. A rise in the index is historically correlated with stronger U.S. economic growth a quarter or two in the future.

“We are fairly optimistic there will be some growth coming at least from the small business portion of the economy,” PayNet founder Bill Phelan said.

— Reuters,

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ELFA Forecasts the Following Top 10 Equipment Acquisition Trends for 2014

The Equipment Leasing and Finance Association (ELFA) which represents the $827 billion equipment finance sector, today revealed its Top 10 Equipment Acquisition Trends for 2014. Given U.S. businesses, nonprofits and government agencies will spend in excess of $1.5 trillion in capital goods or fixed business investment (including software) this year, financing more than half of those assets, these trends impact a significant portion of the U.S. economy. Businesses will need to consider a dynamic environment of economic growth, wider credit availability, and favorable interest rates in their equipment acquisition decision-making.

1. Investment in equipment and software will reach an all-time high in 2014. As the U.S. economy and underlying economic fundamentals, including GDP, continue to improve, business investment is forecast to reach a record $1.5 trillion in 2014.

2Equipment replacement demand will continue to drive investment. Stronger economic growth will boost businesses confidence and appetite for capital expenditures, but overall, equipment already in place can be used at a higher capacity. Until businesses find they need to expand their capacity to meet operational demands, their equipment investment will be in replacing existing aging or obsolete equipment.

3. Demand for equipment financing will increase due to greater stability in the federal budgeting process. Businesses will enjoy a greater level of comfort than they have in recent years to make their equipment acquisition decisions for 2014. The two-year budget agreement passed by Congress reduces fiscal pressures and lessens the chance of a potential government shutdown, while a rising tide of economic growth will lift all boats. As equipment acquisitions increase, so will businesses demand to finance them. 

4The global economy will play a part in the big picture impacting businesses’ equipment acquisition decisions. The lack of long-term breakout growth and expansion on in equipment acquisition has some of its causes beyond U.S. shores. External factors like the stagnant Eurozone, foreign oil prices and the cooling of a hot Chinese economy, which have combined to impede growth, will continue in 2014.

5Rebounding of some industry sectors will spur varied equipment types. Growth in investment is forecast for numerous equipment types, some of which will be the result of increased activity in the housing and energy sectors. The rebounding housing industry will have spillover effects on equipment verticals, including construction as well as trucking and rail transportation to ship home building supplies. Manufacturers plans for billions of dollars in investments to take advantage of cheap, rapidly expanding U.S. supplies of oil and natural gas will expand production capacity for energy and downstream products, such as petrochemicals and plastics, and increase demand for industrial equipment.

6. A majority of U.S. businesses will use some form of financing for equipment acquisition. In 2014, investment in plant, equipment and software in the United States is projected to reach $1.5 trillion, of which 57 percent ($860 billion) is expected to be financed through loans, leases and lines of credit, a slight uptick from 55 percent in 2013. In a continuing trend, seven out of 10 businesses will use at least one form of financing to acquire equipment.

7. Credit market conditions will remain favorable for long-term equipment financing. In a continuing trend from last year, businesses will generally find an increasing credit supply as they consider equipment acquisitions.

8. A low short-term interest rate environment will continue, while long-term rates will rise but remain below the historical average. Businesses that want to conserve cash and take advantage of the many other benefits of financing their equipment acquisitions can look forward to the prospect of continued low short-term interest rates until 2015. Although the Federal Reserve’s policy agenda for 2014 will likely result in a rise in long-term interest rates, inducing some companies to lock in lower rates, they will remain low enough by historical standards to keep financing an attractive option for acquiring equipment.

9. Technology innovations will continue to improve the customer experience. While demand for software and technology equipment is expected to remain strong, equipment finance companies will use technology to optimize their delivery and fulfillment systems around customer service. They will meet a growing demand for cloud and mobile technology as well as access to real-time company data and business intelligence.

10. Long-awaited changes to the lease accounting standard will continue to be debated. A new draft of proposed lease accounting changes issued by the Financial Accounting Standards Board and the International Accounting Standards Board issued in 2013 generated substantial opposition for being too burdensome and complex. As a result, the Boards will continue re-deliberations into 2014 and will conduct additional meetings to address concerns before changes are adopted.

More Information
For businesses that want to learn more about how they can incorporate equipment financing into their business strategies, and for informational resources about equipment financing, including a digital toolkit and Infographic, go to

For forecast data regarding equipment investment and capital spending in the United States, see the Equipment Leasing & Finance Foundations 2014 Equipment Leasing & Finance U.S. Economic Outlook at

About ELFA
The Equipment Leasing and Finance Association (ELFA) is the trade association that represents companies in the $827 billion equipment finance sector, which includes financial services companies and manufacturers engaged in financing capital goods. ELFA members are the driving force behind the growth in the commercial equipment finance market and contribute to capital formation in the U.S. and abroad. Its 580 members include independent and captive leasing and finance companies, banks, financial services corporations, broker/packagers and investment banks, as well as manufacturers and service providers. For more information, please visit

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Bone Chilling Weather and Slipping Sales

Did the Polar Vortex put a big freeze on your businesses’ revenue? The big chill is leaving quite the impact on the southern and eastern areas of the United States. The subzero temperatures is putting a halt to Americans everyday routines. With record low temperatures, heavy snow fall and wind, people don’t and in some cases can’t, leave their homes. Many seem to believe the weather problem will be short lived, however this does not include the monetary effects.

Effecting 200 million Americans, the predicted cost of damage estimates around $5 billion impact on the US economy. This number is including the cancelation of flights, workforce loss, repair of rusted pipes, insurance claims, road repairs, the list continues.

Businesses have seen a drastic drop in sales since the start of the polar vortex due to the lack of consumer spending. Reported in the first week of January, New York has seen a 5.4% decrease in sales in the week ending January 4th. *(Source: (ICSC) and Goldman Sachs Weekly Chain Store Sales Index).

The low temperatures have permanently damaged vehicles, power lines, and shut down businesses. Naming just a few industries impacted; retail shops, restaurants, construction, landscapers, schools, car sales, technical and delivery services all have to play some catch up. In addition, the current farming and agriculture industries have been effected which may continue over the course of the next year.

Even though we are nearing the end of the Polar Vortex the impacts on businesses are not finished. Home gas prices the next few months will be higher, and the utility bills will cause consumers to continue to spend less through February.

On a brighter note, some businesses have reaped the benefits of those staying inside. Energy companies are profiting the most. Cable companies have more customers renting movies, online retailers have experienced a spike in sales and food delivery companies have noticed a big increase in orders.

How Your Business Can Bounce Back

If your business was impacted by this, ILS has advice on how you can recover sales for the first half of January and further.

-Disaster Planning (Make a plan in case of natural disaster). What is it that you see most important in recovering sales in any situation?

  • Increase inventory in stock, increase work staff to catch up on unfinished work, replace broken equipment etc.
  • Alternative methods to do business and make sales.
  • Determine your businesses sales shortage?
  • How much does your business need to play catch up?

-Get funding. ILS can resolve your capital needs.

  • Working Capital Program – $5K to $250K available for any business related expense.
  • Equipment Financing – $5K to $5 million available for new or used equipment.

-Take Action. Now that you have the tools to get back on your feet, reach out to your community and customers. Be creative and offer alternative methods.

ILS is your lending hand in time of need. Don’t let this bump in the road effect your businesses goals and month end sales!

Contact ILS to learn more. By Angela Caraglio

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Out of Our Control – Planning for Disasters

Planning for a Disaster

As a business owner you learn to expect the unexpected. Although it is in your best interest to have something to fall back onto when something completely out of the ordinary takes place. Natural disasters have become seemingly more popular in the news and around the world. It has been called to our attention that no matter where one does business, IT can happen to you! In the past decade we have seen; floods, earthquakes, fires, mudslides, tornadoes, and hurricanes which have caused millions of dollars in damages to everything they touch. While we can’t control the weather, we may be able to lessen the impact of these instances if they are to happen to your business. Learn the basics in staying calm and preparing an emergency plan. 

Emergency Plan Outline

Use these steps to get started:

  • Get organized. Establish an employee(s) to draft the plan. 
  • Assume the worst. Assume that the physical facility that houses the business and all of its contents has been permanently destroyed. From that scenario, list each item that would be important to the business if salvaged and what must be recreated from scratch in order to continue. Typically, the most critical items are business records. Furniture, materials, and manuals usually can be replaced and are insured for their value.
  • Try to prevent the loss. Of those items on the list that should be salvaged, or must be recreated, determine if there are any alternatives that could have been pursued before the disaster to avoid a total loss. Alternatives may include:
    • keeping duplicate records at a different site
    • keeping backup equipment necessary to continue basic operations at a location other than the work site (perhaps a storage facility or, if possible, in your home)
    • storing critical information such as accounts receivable, client information, or outstanding billings in a safe and secure place such as a bank vault
  • Sweat the small stuff. In addition to planning alternatives, you should include the following in your plans:
    • Determine the adequacy of fire and disaster insurance.
    • Complete emergency evacuation planning, including periodic drills, emergency plans, special considerations for any employees with disabilities, and coordination with local emergency and fire authorities.
    • Establish a plan for an alternate work site during the emergency, including records, staff, and support such as telephone, equipment, and related support.
    • Specify under what circumstances a facility will be closed (such as bad weather), who makes the decision, how the decision is communicated, and whether the employees are compensated.
    • If your company operates 24 hours a day or provides a critical service, determine the plan for alternative electricity, water storage, and other routine public services.
    • Plan a public relations spokesperson’s responsibilities carefully and thoroughly (usually, that means you).
    • Have individuals with key responsibilities keep copies of the emergency plan at their homes in the event of an emergency.
    • Update the plan at least annually.
    • Determine if there are any local (usually industry-specific) groups that offer consulting, training, and reciprocal support in the area of disaster planning.
    • Train any employees periodically on fire prevention. There should be a minimum of two fire drills a year and frequent on-site self inspection and review.
    • Train at least one employee in emergency medical steps (such as CPR). 
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Use Credit Cards the Right Way – Improve Your Credit Score

Can you think of someone you know who doesn’t have a credit card? …I can’t! On a daily basis we see more plastic than cash. But that little plastic card can do a lot of damage. Use credit the correct way to grow your score!

An excellent credit score is a sign of responsible financial management. Mortgages, credit cards, auto loans and even cell phone services add depth to an individual’s credit history and can increase a credit score. Scores influence whether a loan or line of credit is approved, the higher the score the better the chance of securing a mortgage, loan or credit card.

One common misunderstanding of establishing excellent credit is that zero balances on credit accounts will earn raise a score. But that’s just not the case. Lenders want to know that you can actually manage your account and, as grand a gesture is of paying off the balance every month, it doesn’t reflect an ability to handle debt. So, even if you have the financial stability to pay the balance off each month, allow one or two accounts to carry a small balance to increase the visibility of responsible money management.

Good credit comes from handling a variety of loans and accounts. It’s impacted by how you handle fixed payments, like your car and mortgage payments. But when it comes to credit cards, there are several points that need to be addressed to help secure a healthy score and history:

Inactive Credit Cards – Should cards that are no longer in use be closed? The simple answer is ‘no’. An inactive card has no negative impact by sitting in a desk drawer; plus, older accounts have more value than new ones. In fact, if you cancel a credit card, you may see a drop in your score because your total credit limit will be reduced… an important factor in determining your credit score. You want to keep your allowable credit as high as possible, which means inactive cards should remain open.

Opening New Accounts – Opening a new credit card account does not have a negative impact on your score – unless you apply too often. Every time you apply for a new credit card or loan, the application generates a hard inquiry on your credit report. Too many inquiries may indicate financial trouble and result in the denial of your application and raise your credit score.

An Important Balancing Act – Carrying a balance on your account is not all bad, unless you are nearing the credit limit. You will see a negative effect on your score, if you max out the balance. You should never use more than 50 percent of your credit limit; a lower percentage is always better. For example, if your credit limit is $2,000, you shouldn’t have a balance of more than $1,000.

Credit Increase: Pro or Con – Asking for an increase on your credit limit may temporarily lower your score. The review process that occurs prior to an increase in your credit line may cause a dip in your score. However, an increase in your credit limit may raise the ratio of available credit to debt and raise your score.

Keep Them Active – Financial experts suggest that consumers use every active account at least once every six months. It only takes a small purchase to keep an account open and maintain the credit limit.

The importance of maintaining credit card debt responsibly cannot be understated. Late or missed payments are an absolute deal breaker when looking to earn an excellent credit rating. More than any other type of loan, credit cards reap the biggest boost to your score when managed well.

Interested in accepting credit cards for your business? Visit our Merchant Services Informational Page >

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10 Steps to Starting a Business

Starting a business seems like a daunting task. Don’t know where to start? Utilize the 10 steps to put your own name on the door!

1. Write a Business Plan

2. Get Business Assistance and Training

3. Choose a Business Location (make sure to select a customer friendly address)

4. Finance Your Business (Find a Lender who can help startups!)

5. Determine the Legal Structure of Your Business (Sole Proprietorship, Partnership, LLC, Corporation, Privately Held)

6. Register a Business Name (Doing Business As, DBA)

7. Get a Tax Identification # (Dependent on state for IRS and State Revenue Agency)

8. Register for State and Local Taxes (Register with state to obtain Tax ID #, Workers Compensation, Unemployment and Disability Insurance)

9. Obtain Business Licenses and Permits

10. Understand Employer Responsibilities (Learn legal steps to hire employees)


Start-Up Resources:

Equipment Leasing/ Equipment Financing – finance equipment or services needed for the business without purchasing all up front

Working Capital – funding for any business expenses

Merchant Services – credit card processing as additional payment options for customers

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