Why Banks Deny Loans to Small Businesses

Starting a business is one of the most rewarding, yet difficult endeavours to undertake. The road to profit is very challenging. Business owners need a great deal of money to launch their venture. They depend upon commercial lending for financing. However, many times loan applications are rejected by banks.
Here’s a list of reasons a business loan can be rejected.

  • Bad credit

    Even though not everyone has the best credit, as far as lenders are concerned, this just isn’t an excuse. Poor credit is simply a sign that a borrower, or their business, does not prioritize repaying their debts. Credit score of the borrower is very important criterion for money lenders to decide whether to accept or reject a loan offer. Most banks typically won’t loan to a business owner whose personal credit score isn’t above a certain threshold (typically about 680).

  • Not enough collateral

    All business loans require collateral. Unfortunately not all businesses have sufficient collateral to support the size of the business loan they wish to borrow. Another obstacle is the price depreciation of certain collateral. Know the value of your collateral before you ask the bank for the loan.

  • Under-capitalization

    Borrowers often make the mistake of under-capitalizing their business loan application. Your personal and professional resources including fixed assets, retained earnings, and the even an owner’s equity, can be attached if required to secure repayment of the debt. Do your homework; know what capital you have on hand. Know what you can pledge and use to grow your business and repay the bank’s loan.

  • Cash flow problems

    Lenders see no reason to offer money to a business that has serious cash flow problems. Banks want to see that businesses have enough money to make monthly loan payments in addition to covering rent, payroll, inventory and other costs.  After all, if a business isn’t even making money to begin with, then there is no need to hand it a business loan in the hope that is generates growth. There has to be adequate cash flow available to repay a loan. Most bank term loans are not ideal for start-ups or very young businesses. They typically look for a few years of revenue generation. Start-ups can apply for SBA loans (which are loans made by a bank with a portion guaranteed by the US government). Most large banks have SBA loan departments, so be sure to check with your local branch.

  • Lack of preparation

    Many businesses simply aren’t savvy about the application process and believe they can walk into a bank, fill out an application and get approved for a loan. Before applying for a bank loan, businesses should have a written business plan, financial statements or projections, personal and business credit reports, tax returns and bank statements. They should also have copies of relevant legal documents including articles of incorporation, contracts, leases, and any licenses and permits needed to operate.

  • Difficult conditions

    Even if a business has excellent collateral, credit, and is well run, there is still the possibility that it will soon face industry-specific difficulties. For example, a lender may be hesitant to lend a business loan to a transportation company in the wake of rising fuel costs. The lender may expect that the soaring costs of fuel are just going to overtax the transportation company and make it difficult to grow or generate a profit. Outside influences are always considered prior to a loan approval or decline. They can include industry experience of a borrower, a business’s location, local or regional economic trends, competitors etc. In addition to these, seemingly unrelated factors, such as local climate conditions, may also influence an applicant’s approval or denial.

These reasons are warning signs to look out for on the road to getting a business loan. Even if borrowers achieve success and borrow business loans, they still have to successfully run their business and payback their lender. While not all ideas need financing to get started, getting a business loan is a great aid to launching a new company.

Dealing with Workplace Harassment

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Workplace harassment and office bullying are unfortunately common incidents these days. It refers to any repeated, intentional behaviour directed at an employee that is intended to degrade, humiliate, embarrass, or otherwise undermine their performance. It can come from colleagues, supervisors, or management, and is a real problem for workers at all levels. It’s no joke. By learning to recognize and address workplace bullying behaviour, you can help to create a healthier, more productive environment for yourself and your colleagues.

What women can do

  • Communicate your disapproval – If you can avoid the colleague who makes you uncomfortable, do so. If you have to work in close proximity to him, avoid being alone with him and tell him to stop his specific behaviour. If the person has sent you a joke through an email or SMS, reply through email or SMS when asking him to stop.
  • Keep a record – If your colleague isn’t getting the message, prepare to report him. Gather evidence to substantiate your claims. ‘Note down the date, time and details of each incident. Save any emails or text messages that contain inappropriate language. Try to use your mobile phone recorder to discreetly record his remarks.
  • Find a friend to share this information – Share the situation with a colleague you trust in the office. She may be able to keep a watchful eye on the situation. But be picky about who you share this information with, and ensure that this person is trustworthy. A senior colleague or mentor who carries more weight in the organisation would be ideal.
  • Formal complaint – If the above doesn’t work, make a formal complaint to senior members of the organisation, with whatever evidence or notes you have. Make the complaint in writing and keep a copy. Remember an oral complaint can be hushed up. Often women don’t report sexual harassment for fear they might lose their jobs, but unless you are willing to take action, your problem will persist.
  • Contact EEOC – If your complaint does not result in your supervisor or senior manager taking action, you can file a charge with the Equal Employment Opportunity Commission (EEOC), which investigates sexual harassment incidents in the workplace. Inform the EEOC of your employer’s name, the name of the offender and the details surrounding the incidents.
  • File a lawsuit – After you file a complaint with the EEOC, you can possibly file a lawsuit. You can seek monetary damages, or try to get your job back if your employer fired you due to the incidents. If you plan to file a lawsuit, you should seek legal representation from an attorney who handles sexual harassment cases.

Why Women Don’t Start Business?

According to the Global Entrepreneurship Monitor (GEM) report, only seven women start businesses for every ten men. There is a big “confidence gap” between male and female entrepreneurs.

Here are the main reasons why women hesitate to start their own businesses:

  • Women are less confident

    About three-quarters of both male and female entrepreneurs start businesses to pursue an opportunity, but men show more positive perceptions about opportunities and their own capabilities, as well as lower fear of failure. Women are inclined to take fewer risks.

  • Women use their savings, men get loans

    On an average, women start their businesses with a median amount of $8,000; men had $30,000. Women were also more likely to use their own cash or borrow from family members, while men got bank loans. With fewer funds to start a business, women have little or no scope for taking necessary steps.

  • Men are more likely to know other entrepreneurs

    It seems contrary to the general norm of women as social connectors and men as isolated individualists, but men are more likely to have robust professional networks when starting their businesses. They were also more likely to already know someone who had branched out on his own, providing them with a valuable source of information.

  • Content with life

    Women are content to live their lives peacefully, calmly without any stress brought about by starting a business.  For most of the women, money is not a motivator. And if it is, they feel that they can get it from their jobs working within an organization, instead of starting a new venture.

  • Responsibility of managing family

    Women always have to struggle to balance career and families. Starting a business involves a lot of dedication. Women feel they cannot devote that much time while handling household responsibilities.

Tech Layoffs – Make it a New Beginning

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The tech industry may seem like it is thriving, and that is not absolutely true; but it is also important to know that many tech companies are often cutting costs and handing out pink slips. During mergers, acquisitions or restructuring, unexpected changes occur. If you hear rumours or have reliable information in regards to any changes, now is the time to start working accordingly towards a more secure position.

The best step to take in situations where changes occur within the company is to be prepared for the worst. Here’s how:

  • Update your resume – Start preparing a list of your accomplishments and quantifiable achievements. Include a description of your current position in resume as written down by HR.
  • Prepare list of references – Contact the people you would like to use as references to ask their permission to be used as a reference.  Obtain their current contact information and type up your reference list.
  • Check job board websites – See what the market demands are and which types of positions are available for the candidates of your education and experience. Start applying right away, if you feel that the chances of getting laid off are high.
  • Consider different career alternatives – You can take layoff as an opportunity to start fresh. You may change your career and get into new field, you always wanted to be in. Instead of looking for a new job, you may try consulting or freelancing. The other option is pursuing further education or certification. You can make these career decisions now, when you could be possibly having more time in your hands.
  • Network with friends/acquaintances – Start making contact with your network and re-establish the connection, so that if you get a pink slip, you will have already updated them on your situation and can then call them into action to help you track down job leads.
  • Backup your personal files from office computer – In reality, you should never have personal stuff stored on your work computer, but we probably all do from time-to-time. It’s best to be safe and remove all your personal files because when you get the bad news, it comes swiftly and security escorts you out of the building. Bring in a flash drive as soon as possible and wipe all personal information off of your computer.
  • Examine your finances – If you fear a layoff is on the horizon, now is the time to get your finances in order. Even if you are lucky enough to get a severance package or qualify for unemployment benefits, neither is often enough to pay the bills during the period you are out of work. Consider consolidating bills so you have fewer monthly payments and put a halt to any major purchases you had planned until you are solidly on your feet again.
  • Talk to your family – This is probably the hardest thing – talking to your family about defeat, even if it’s not your fault. Your family are the very people you MUST talk with. These are your loved ones and key supporters. In addition, since their lifestyle and spending habits may have to drastically change in the near future, it’s best to prepare for the changes as a family.
  • Moving ahead – Once you are ready, whether you get laid off or not, it’s time to go to the next step and prepare for your return to the job market. You have to look to the future and move your career forward!

Whether you are among the unfortunate ones, who have lost their jobs or just looking for a change, TheGongzuo.com is always there to help you find your new job and take you further up on your career ladder. Register on our website today!

Top 6 Challenges Women Entrepreneurs Face

Entrepreneurship was once considered a man’s domain, but numbers are now changing. According to 2015 data from the National Association of Women Business Owners, more than 9 million U.S. firms are now owned by women and they generate total $1.5 trillion in sales.

Although more women are becoming entrepreneurs, they often face a set of challenges not typically shared by their male counterparts. Female CEOs have stated some of the key challenges that they face –

  • Confronting social expectations – When women entrepreneurs have to talk business with primarily male executives, it can be unnerving. They may feel as though they need to adopt a stereotypically “male” attitude toward business: competitive, aggressive and sometimes overly harsh. But successful female CEOs believe that remaining true to yourself and finding your own voice are the keys to rising above preconceived expectations. Women need not adapt themselves to a man’s idea of what a leader should look like.
  • Limited funding – The hardest part of starting a business is raising capital. It gets all the more difficult for women-owned firms. Venture capitalists tend to invest in start-ups run by people of their own “tribe” meaning, venture capital firms with female partners are more likely to invest in women-run start-ups. But, that accounts for only 6% U.S. firms. Women looking for business investors should build confidence through a great team and business plan.
  • Own your accomplishments – Women tend to downplay their own worth. When they talk about their company or achievements, they tend to use the word “we” instead of “I”.  Using the first person to discuss successes feels, as if they are bragging. They need to have confidence in running a business. It’s important especially when their ideas receive more scrutiny than their male colleagues.
  • Building support network – With the majority of the high-level business world still being dominated by men, it can be hard for women to create their own path. Lack of advisor and mentors is one of the major blocks that limits professional growth. They could start networking with other women through groups and forums created specifically for women in business.
  • Balancing business and family – Work-life balance is a goal of many entrepreneurs regardless of their gender, but mothers who start businesses have to simultaneously run their families and their companies. And in this area, traditional gender expectations often still prevail. “Mompreneurs” have dual responsibilities to their businesses and to their families, and finding ways to devote time to both is key to truly achieving that elusive work-life balance.
  • Coping with a fear of failure – Women need to stop worrying if people will treat them differently in business because of their gender and they also need to stop comparing themselves to others, including men. The bottom line is, if you’re successful, no one cares whether you are man or a woman.

12 Tech Startups With Women Founders

Women population in tech world is low, but a positive sign is that they are taking action! Many aren’t waiting for companies to give them leadership roles; instead they are launching their own businesses.

Here is the list of tech start-ups owned by females:

  • AdmitSee – This start-up seeks to bring transparency to the college and grad school application process. It makes easier for students to get admitted to college. Students can find the profiles of other students, see where others have applied and got accepted, strategize their own applications and can even get access to successful college essays. AdmitSee transforms an overwhelming, time-consuming grad-school admission process.
  • Dot Laboratories – Dot offers diagnostic tests for endometriosis. Dot is creaking a path for early awareness; their technology will arm women everywhere with the knowledge they need to make critical health decisions.
  • FINDMINE – FINDMINE runs product catalogues and retailer looks against user data. They then match your goods to shoppers’ tastes. This means shoppers see their perfect outfit on the website, in ads, in emails, etc. It leverages the power of data! Retailers use data to cater to customers and personalize marketing.
  • Give InKind – A platform dedicated to providing comfort for those who need it, from organizing meal delivery to products to advice articles. Taking the hassle out of providing care for loved ones is a great concept.
  • Indian Moms Connect – This is an online community for Indian moms. They share stories, tips, recipes, you name it. It’s all user-generated content, which creates an immediate sense of community. Plus, they have great product suggestions embedded within their content.
  • Pace Match – Pace Match helps you find a running partner who lives near you, and whose speed matches yours. This was the result of a developer using her spare time to play with a runner’s API—and she realized that speed was the ultimate data point.
  • ResultCare – An app dedicated to evidence-based medicine. It factors in cost so that clinicians can make smarter decisions. Healthcare is begging for innovation and the fact that this app takes costs into account is the key.
  • Stilla – The smallest security system that fits into your hand. It can link to anything—a door, a bag, a laptop—and it will alert you if the object moves. The ease-of-use aspect here is fascinating. You can use the system for the objects you need, when you need it.
  • Vidcode – A JavaScript coding platform targeted to teens. Platforms like this, that teach code in a fun, respectful manner, are in high demand.
  • Hitlist – Hitlist lets you build wish lists of places you want to travel to. When there are fare deals for those places, Hitlist will send you an alert so you can buy tickets cheap.
  • Control – Control helps businesses manage the payments they receive online from customers. Businesses can manage multiple accounts with Control on different devices (mobile on iOS or Android, or with the desktop web app).
  • Shippo – Shippo wants to shake up the shipping industry by making it cheaper and easier for online marketplaces and merchants to send you your stuff. Shippo’s software lets e-commerce companies connect with different shipping providers to get better rates and labels at a low cost.

If you are one of those women, who dream of starting your own business, but hold back due to certain reasons, get inspired by these women. We at TheGongzuo.com will help you launch your dream. Register at our website for free and let’s get started!

Women Who Rock The Tech World

The tech world is fast-moving, highly competitive and male-dominated. But some of the most prestigious and best-remunerated roles are held by females.  These women are steering in a new era of female tech leadership.Below are the most powerful women in tech from around the world in 2016.

  • Sheryl Sandberg – COO, Facebook – In June 2012, Sheryl Sandberg became the first woman to serve on Facebook’s board of directors. That same year, she made Time’s 100 Most Influential People list. She supporting continued growth at Facebook and has also promoted initiatives to address the gender gap within the tech industry and is on the board of Women for Women International.
  • Susan Wojcicki – CEO, Youtube – In 1999, she joined Google as their first marketing manager and worked her way up to senior vice president of Advertising and Commerce. After overseeing Google Video for some time, Susan proposed that the company acquire Youtube (which at the time was a small start-up). She later handled two of Google’s largest acquisitions: the $1.65 billion purchase of YouTube in 2006 and the $3.1 billion purchase of DoubleClick in 2007. In February 2014, Susan was appointed CEO of YouTube.
  • Ginni Rometty – CEO, IBM – Ginni heads IBM, serving in the capacities of Chairman, President, and CEO. She is the first woman to do so. Since 1991, she has held various important roles at the company and was appointed CEO and President in October of 2011.
  • Meg Whitman – CEO, Hewlett-Packard – Meg Whitman has a long and varied career, serving as an executive for numerous high-profile companies. During the 1980s, she was vice president of strategic planning at The Walt Disney Company. In the 1990s, she worked for DreamWorks, Procter & Gamble, and Hasbro. Then, from 1998 to 2008, she served as president and chief executive officer of eBay.
  • Marissa Mayer – CEO, Yahoo – Marissa has been the current president and CEO of Yahoo! since 2012. Prior to her employment with Yahoo!, she worked at Google as an executive and spokesperson for over a decade.
  • Safra Catz – Co-CEO, Oracle – Safra has been with Oracle Corporation since April 1999. In October 2001, she joined the company’s Board of Directors and was named President of Oracle Corporation in early 2004. From November 2005 to September 2008, and from April 2011 to the present, she also served as the company’s CFO. In September of 2014, she became co-CEO, along with colleague Mark Hurd.
  • Angela Ahrendts – SVP, Retail, Apple – Angela is new to the tech industry, but not new to leadership positions. She served as the CEO of Burberry from 2006 to 2014, before leaving to join Apple as the Senior Vice President of Retail and Online Stores. In 2014, she was Apple’s highest-paid executive, earning over $70 million.
  • Ursula Burns – Chair-CEO, Xerox – In July 2009, Burns became the first African-American woman CEO to head a Fortune 500 company. She had worked for Xerox since 1980, beginning as an intern and climbing through the ranks for the next three decades. President Obama appointed her vice chair of the President’s Export Council in 2010
  • Ruth Porat – CFO, Google – After working with Morgan Stanley for decades, serving as their Chief Financial Officer and Executive Vice President from January 2010 to May 2015, Ruth Porat became CFO of Google on May 26, 2015.
  • Renee James – President, Intel – Renee James has worked at Intel for over 25 years, serving in a variety of roles. She became President of Intel Corporation in May 2013. Renee is one of Silicon Valley’s most prominent female executives and Intel’s highest-ranking woman ever.

Technology still has a reputation for being a male-dominated field, but these women and many others are proving that gender is no barrier to success.