Business Credit Cards: Robbing Peter to Pay Paul?

Any business, no matter how large or small, requires funding. Once the capital to launch the business has been secured, the new business owner then faces the need for regular turnover in order for the business to perpetuate itself. While this may seem obvious, it can be a tougher task than originally anticipated, especially in the early days when the business may have little or no initial reputation. The new business owner can then be put in the position of having to pay wages or order business items, but not having the access to business capital to be able to do so. Some entrepreneurs take it upon themselves to fund the beginnings of their businesses using their personal credit cards. Whilst this may seem like a perfectly logical solution, it can cause more problems than it solves. Sorting paperwork for the tax period can become a nightmare and result in difficulties for both the business owner and the business itself.

A far better method is to apply for a business credit card, which is designed specifically for business funding. A business credit card keeps the accounts of the owner and the company separate, making life much easier when it comes to business management. Most business credit cards offer an online facility enabling you to keep track of business transactions, as well as reducing the paperwork involved at the same time. A business credit card also offers legal protection against unsatisfactory goods and services, ensuring that the company does not have to spend, where the spending is unwarranted.

Business credit cards also offer an effective way to manage a company’s cash flow. People can be paid and items can be bought without the money immediately leaving the business’s cash account. This is especially useful during times of restricted cash flow or when waiting for a customer payment to clear. Of course, the credit borrowed will have to be repaid, but careful management will allow repayments to be met monthly, and for the business to function normally.

In addition to the benefits of credit, small business credit cards come with a list of incentives and advantages that are designed specifically with the small business owner in mind. This can take the form of things such as 0% APR for a fixed period and also involve deals that can save the business money through discounts and incentives. Perks such as petrol discounts and Airmiles are very common these days, but the wise business owner can shop around to take advantage of deals that are pertinent to his or her company. These may take the form of cashback on certain products and services or even discount on hotel accommodation. If there are recurrent payments to be made, these deals can be taken advantage of and factored in to the decision of which business credit card to choose.

Finding the right business credit card need not be as difficult as it first appears. Yes, there are a plethora of business credit cards out there and, yes, each comes with its own set of advantages. However, if the owner has a good understanding of exactly what the business needs in terms of credit and perks, then the rest is just a process of elimination. Aside from old-fashioned research, there are other tools available to help the business owner select the card that best suits their business needs. Internet comparison sites are invaluable resources that condense the main ingredients of each card and display them in an easy-to-read comparison format.

A business credit card may not be a card that takes care of itself, but then neither is a business; both require attention and care. However, both can offer valuable returns and, if handled wisely, offer the opportunity for expansion and development.

By: Hannah Callen

About the Author:

Hannah Callen is an independent financial author who writes for various popular websites. Read more about Business Credit Cards and 0 percent business credit cards here.

Lebanon: Many Businesses Plan to Expand, Despite Unrest

BEIRUT, Lebanon, Feb. 6, 2008 (IPS/GIN) — The year 2008 has already been grim for most Lebanese businesses: Struggles with the nation’s permanent protest movement, security problems, a brief war in a Palestinian refugee camp and sporadic bombings have brought the nation to its knees.

Most recently a bomb tore through the bustling Chevrolet area on the outskirts of Beirut on Jan. 25, killing Captain Wissam Eid from the Internal Security Forces.

As the political situation tips further in the direction of widespread insecurity, however, Lebanese businesses around the country are clinging to the motto, “the show must go on.” Expansion seems to be the word on the street in Beirut, no matter what the uncertain future may hold.

ABC, a major department store and mall with seven outlets, two main flagship stores and a staff of more than 1,000 is currently revamping one of its main branches in Dbayeh.

"In March, we are also launching a new section extending over an entire floor of 8,000 square meters dedicated to children, dubbed Kidsville. It will also include a 500 square meter playground, an array of kids’ accessories and a coffee shop, La Mie Dorée," said Robert Fadel, ABC’s general manager. A second big store in the Ashrafieh suburb of Beirut is adding an extension for a playground that will fill an expanse of 800 square meters.

The Johnny R. Saade group is also jumping on the expansion bandwagon. Its travel and tourism arm, Wild Discovery, will be setting up shop in Kaslik in northeast Lebanon in a few months.

"We decided to push forward with the opening of new branches in Lebanon despite the prevailing situation, following the simple strategy that one has to invest and position oneself in times of relative crisis to prepare for the inevitable economic and political recovery that can be foreseen," said Sandro Saade, one of company’s owners.

"This opening is also justified by a strategic objective to cover the northern Beirut area, where there is a demand for high-quality travel services."

The company’s real estate arm boasts a $30 million residential project sprawling over 18,000 square meters in one of Beirut’s posh suburbs. In addition, the group is developing a winery in Bekaa Valley, near the villages of Kefraya and Tell-Denoub, covering a 50-hectare swath of land. The project is estimated at $25 million and will employ 50 people, excluding seasonal workers.

"The Lebanon venture will also integrate two other complementary projects, namely a wine museum and a boutique hotel, or ‘hôtel de charme’” with 30 to 35 rooms, said Karim Saade, another company owner.

It is not just big names that are taking a leap of faith into the murky Lebanese waters.

Nehme Lebbos, founder of Iloubnan, a news portal for Lebanon, left his home country in 1991 and worked as an IT consultant for 12 years in France before coming back.

"I wanted to come back ever since I left. I started IIoubnan in March 2005 with the help of my wife, a French journalist,” Lebbos said. “It is a Web magazine dovetailed with an e-commerce wing."

The young entrepreneur has poured all his savings into this venture, relying on a bank loan, as well. The company’s recent success has allowed for an increase in operations, with four journalists employed on a full-time basis and a network of 20 freelance journalists around the world.

A shared vision of Lebanon seems to cement together the diverse business figures. "Lebanon is our homeland and we believe in our country," Fadel said. On the other hand, Lebbos is conscious of the risks he might incur but is nonetheless determined to promote change in his home country.

Although most companies are investing in Lebanon, many have also looked to taking their business abroad. ABC will be opening in Jordan in March. "The company will bring to the Jordanian market a spirit of Lebanon, and aims at becoming a leading and trendy shopping destination," Fadel said.

Similarly, the Saade brothers are relying on an international network of agencies for their tourism activity as well as launching a new winery in neighboring Syria. The group is trying to counter the negative business environment by highlighting the quality of its services. And so Wild Discovery is investing in an in-house sales training program expected to enhance its team’s knowledge and technical skills.

For most entrepreneurs, the essential rationale linking their projects is endorsing Lebanon as a brand in the region. Lebbos believes that this cannot be done without the help of young Lebanese people. "They need to travel, study abroad, graduate and experience foreign countries," he said, and "then come back and invest in Lebanon."

By: business news

About the Author:


How a Business Coach Can Help you Set Up your Business So you Can Let Go and Stay in Control

As a business coach I often observe that the challenge with growing a business for most business owners is that they can be scared of ‘letting go’.

You see, most business owners start off in their business doing everything… and as the business grows they try and take on more and more to keep ‘in control’.

Yet the time comes in the growth of the business where they HAVE to let go…

They can’t physically keep up!

Sometimes the business owner does their best to keep up. They work more, longer and harder but despite all of their efforts the business starts to ‘stagnate’.

And the owner becomes tired.

There are no more hours in the day.

They begin to realize that they can’t possibly keep their fingers in ‘all the pies’.

They have to let go.

Now most business owners are proud of the fact that they ‘know what’s going on’ in every area of their business…

And some dread losing this ‘contact’ or ‘control’

You see by being ‘in’ the business the business owner gets a feel for how the business is traveling.

If they keep on the ‘floor’ they can see customers coming in, what stock is selling, what stock is being delivered.

Now the big step (for them) is moving away from being involved to overseeing. Because they are scared that they’ll lose the ‘feel’ of the business.

And it’s at this point that some business owners panic.

What’s the answer?

The best business owners learn how to keep a ‘feel’ of their business without having to be there.

How can they do that, you may ask, if they’re not involved every day?

How can the best business owners know if it’s busy?

How can they know what stock is needed?

How can they know if customers aren’t happy?

How can they know which staff are being productive and which ones aren’t?

How can they keep their eye on the registers and the petty cash?

How can they do all this?

They can do it by setting up and monitoring their measuring and reporting systems.

I call them ‘dashboards’ or ‘scoreboards’.

You see the best business owners set up ‘dashboards’ so that they can ‘see’ how their business is going.

It’s like a dashboard in a car, or a cockpit of an airplane.

When you’re driving you don’t need to put your head out the window to ‘feel’ how fast you’re traveling. You just look at your speedo.

And you don’t need to look in your petrol tank to see how much petrol you have used. You just look at your fuel indicator on your dashboard.

If you set up Key Performance indicators in your business you can see how different areas of your business are performing.

All the best businesses do it. And you should too.

And you should start now… before you put on more people…

I get all my clients to start measuring critical areas of their business. And there’s a certain process to do it, and a certain way to measure it so that it works.

And when you get it working it can help liberate you from your business.

When you have your own ‘dashboard’ or ‘scoreboard’ you will need to look at some key things daily, whilst others are better to look at weekly, monthly and even quarterly…

And when you have them you can step out of your business. Because the ‘dashboard’ will tell you what’s going on when you’re not there.

It’s magic.

Even if you’re not in the business you’ll be able to gauge how things are going and how your people are going. Who’s doing things and who’s not… so you can step in and take action to improve the situation immediately.

With the right systems, people and training like I have outlined, works like a charm and it’s one of the most powerful things that you can do to take your business into the multi-millions of turnover.

I use these with my clients with extraordinary success.

We look at them every week to assess how the business, and how the team in the business are performing and based on the accurate and timely information take action to correct anything that ‘off-track’ and caress anything that is on track.

For example.

One of my client’s critical areas dropped from 37% to 22% then 21%. Now to you that may just be a percentage figure but to the business owner and I it meant we were losing $2,000 profit per week every week that it stayed at the new lower level. That’s $100,000 profit in a year.

So we jumped into action. After a certain process that I stepped him through we drove it back up to 44% and kept it there. That one thing alone made him tens of thousands of dollars in just a matter of weeks let alone what it made him over a year.

Another step that I take my clients through is setting up their ‘dashboard’ whilst they are still ‘involved’ in the business then the next step is to send the ‘dashboard’ to their home for them to look at in their own time

This steps them from having a ‘feel’ of the business to looking at the ‘dashboard’ so that they can transfer their ‘feel’ of the business into assessing the numbers that are on their ‘dashboard’.

As we step through that we determine ‘standards’ that each of the critical areas should be reaching each day, week, month for the business to be dong ‘nicely’.

Then armed with the standards and the dashboard the business owner can comfortably step out knowing what the dashboard has to show for him/her to stay in control of the business.

We then work on getting the business owner out of the day to day running of the business. For example if the owner is working 5 days in the business… the first step is to move him to 4 days in, and one day out. Then 3 days in, 2 days out… then 2 days in 3 days out and so it goes until the owner is able to choose their work hours because the business runs without them having to be there.

Then when you choose to come into the business you can do the work you want to do, and focus on the building your team to run your business for you.

Remember when your business is working it means that you don’t have to.

Your life may never be the same.

Join me when the timing is right for you and together we can grow your business and help you ‘let go’ of your business and stay in control.

Set up your business so you can let go and stay in control.

Copyright © 2006 by Casey Gollan. All Rights Reserved

Business Coach, Mentor And Growth Specialist

Casey Gollan, Business Coach, Mentor And Growth Specialist. Grows $1 Million p.a. Small Businesses Into $2 to $5 Million p.a. Businesses Over a 2 to 3 Year Period.

By: Casey Gollan

About the Author:

Business Coach, Mentor And Growth Specialist
Casey Gollan, Business Coach, Mentor And Growth Specialist. Grows $1 Million p.a. Small Businesses Into $2 to $5 Million p.a. Businesses Over a 2 to 3 Year Period.