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.

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Bluetooth, Wi-Fi…..How These Terms Were Born?

Certain terms, which were once part of technical jargon, have taken place in our normal vocabulary. Ever wonder how these terms originated?  You will be surprised to find out the facts behind it.

  • Bluetooth – Bluetooth comes from the name of an ancient Danish king called Harald Bluetooth. What’s significant about King Bluetooth is that he united different regions and allowed them to communicate with each other.

 

  • Wi-Fi – Wi-Fi, as it turns out, doesn’t stand for anything. Phil Belanger, a founding member of the Wi-Fi Alliance, has gone on the record as saying the term was nothing more than a catchy word created by a brand consulting firm.

 

  • Troll – While the imagery of a goblin-like cave monster seems awfully apt, there’s actually more to the term than meets the eye. The word “troll,” you see, is also a verb meaning “to fish by trailing a lure or baited hook from a moving boat.”

 

  • Wiki – Credit for the first wiki is commonly given to a guy named Ward Cunningham, who came up with a site called WikiWikiWeb. Ward was wooed by the word wiki when he traveled to Hawaii, where he saw a “wiki wiki bus”. “Wiki” means “quick” in Hawaiian.

 

  • Ping – Ping, in its current form, traces back to a Unix-based network administration tool created in the early 80s. The program sends a data packet to a network-connected computer and then measures how long it takes for the system to respond.

 

  • Spam – Spam, according to most popular accounts, comes not from the questionable canned meat but rather from a 70s-era Monty Python sketch.

 

  • Cookie – The most common explanation suggests the term comes from Unix. In Unix, a “magic cookie” refers to a chunk of data that’s passed between two programs.

 

  • Bug – In 1946, Grace Hooper joined Harvard, where she traced an error in the computer due to a moth trapped in it. This bug was carefully removed, the word ‘bug’ is still being used to describe defects.

 

  • Hotmail – Its founder tried all kinds of names ending with “mail”. Later he chose “Hotmail”, as it contains all the letters “HTML” – the markup language used to write web pages.

 

  • Java – “Java” was selected from a list of suggestions, primarily because it is a popular slang term for coffee, especially that grown on the island of Java. As the programmers drank a lot of coffee, this seemed an appropriate name.

 

  • Python – Named after the television series “Monty Python’s Flying Circus”.

 

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.

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Read more: http://thegongzuo.blogspot.com/2015/02/job-search-now-made-easy-with-thegongzuo.html