Mourning the death of the inheritance
Just read an interesting article at Your Money from the New York Times. Here’s the full article link.
Essentially, it suggests that older americans are spending more of their savings and inheritances are dwindling. Here’s a few reasons why that may be happening.
- With the economy in an all but declared recession, seniors are choosing (or perhaps more out of necessity) to help their children with their expenses even when the children are adults. Seniors can disguise it as helping pay for their grandkids tuition, sports activities, and maybe clothes, but the fact remains that the money could have stayed in the bank.
- Seniors are spending more because they are living longer. Rising health care costs are eating away at the nestegg. Medicare and social security benefits are being reduced, forcing more money to come out of pocket.
- Seniors are healthier longer and having more fun. Spending money on travel, dining out, and other fun activities are being enjoyed for a longer period of time than ever before.
It makes you think, as a parent. What will I leave behind for my children? It might not be the inheritance that fill bank accounts. For my wife and I, it’s more important for our kids to learn how to make, save, and give back money. Sure, the inheritance check is important, but that can be spent and it is gone. But the knowledge is sharpened with each use.
Summer heat equals added customers
I recently talked to a restaurant owner who was looking to add outdoor seating to his growing cafe business. The problem? No cash!
He needed to spend about $2,000 to add 10 tables, fix the concrete patio, and add some umbrellas. Rather than take the money out of his personal savings, he chose to get a merchant cash advance.
He received funding in 14 days, and anticipates having the loan paid off in 90 days. It will cost him a bit of interest, but as he sees it, he is making an easy $25-50 clear on each table per day.
Rather than find excuses for why you can’t grow your business, find solutions.
- Brian
www.bedrockfinancing.com
Stop selling and get more customers!
Stop Selling! Learn How To Ask For Sales Referrals.
Whether you are a business owner or salesperson, closing deals and acquiring customers takes lots of hard work. But sometimes, we can oversell. Well, maybe its time to stop trying to sell.
Let your customers sell for you through sales referrals. But first you need to learn how and when to ask.
With a referral, there is instant trust and your selling cycle time is reduced. The time it takes the referral to buy is usually much less than any other lead source. What this really means is less hassle and more sales.
Clients are the best referral source because they know you and they know your products or services. Never miss a chance to ask a happy client for a referral, and a testimonial letter while you are at it.
You can also ask prospects. Suppose you call a prospect only to discover that your product or service doesn’t match a need. You can still ask for a sales referral at the end of your call. What’s the worst that can happen? They say “no.” No big deal. Move on. But sometimes, just sometimes, they provide you with a name. And that’s a great start.
Ask for sales referrals at the end of your visit or contact. AFTER you have completed your primary objective.
Sales referrals seem easy enough but there is a bit finesse required. Here’s how NOT to ask for a referral: “Jim, do you know of anyone who might be interested in my services?”
This is NOT the recommended method because it is far too easy for your customer or prospect to say, “Ahh…no.” The ‘no’ that they give you is often reflexive in nature; an automatic response to a closed ended question. In other words, they respond negatively out of habit. You could be missing tons of opportunities.
The BETTER way to ask for the sales referral is this:
“Sandy, can you give me a name or two of someone you know who might be interested in these types of products?”
The difference is subtle but significant. By asking for a “name”, your client has to THINK about names. It is not quite as easy to give you a dismissive “no.” Usually, they tend to do a mental scan of friends and associates. This scanning pause helps reduce the automatic, reflexive ‘no’ response.
Of course, they can and sometimes will, say “no.” But by asking for a name you increase your odds and improve the chance for success.
Good Luck!
- Brian Little
www.bedrockfinancing.com
And the rate cuts end, finally.
At an economic conference in Spain, Bernanke called current Fed interest rate policy “well positioned to promote moderate growth and price stability over time.”
What does this mean?
His words strongly suggest that the central bank is getting more worried about inflation. They appear more concerned about the weakening of the dollar and rising costs. As of now, I think the Fed thinks the economy has survived the credit mess, the spike in oil prices, and although weak and feeling wobbly, has not broken.
As a consumer though, I don’t know how much more I can take. $4.00 gas is not a happy thought. It has changed my driving habits. My grocery bill is my next challenge. With a family of 4 kids, I can’t believe how much per week I a paying just for the essentials. Forget about that Sunday cookout of shrimp and some steaks. It’s burgers and hot dogs for us.
When your bank says no…
Many of the companies I have worked with over the past six months are looking for an additional way of acquiring money when they cannot go to a bank. In many cases, these are start-up businesses without the credit or assets to acquire a traditional loan. In others, they may have a loan already, but just need some extra cash.
Factoring your receivables can be a good solution to help improve your cash flow. Here’s some more info about factoring, click here.
Invoice factoring is a reliable source of financing for your business as over the years many businesses have used it to generate quick capital. The best way to describe it is as the sale of accounts receivables. Perfect for a start-up business or businesses in need of capital fast; invoice factoring allows lenders to make a decision based on the clients’ credit decisions, and not the business credit.
It can take a long time to get approved for a bank loan, and most businesses get turned down when they go after a regular loan. That is where invoice factoring comes in because it doesn’t take much to get approved. All it takes is some clients with good payment histories, and you will have the cash quick.
The process is simple; you sell your accounts receivables for a discount of maybe 5% to 10% of the actual value to the lender, or the factor. The factor will than work to collect the accounts receivables for the full amount which is where they make their profit. Even though you lose some revenue and profits, it is better for your business sometimes to have the capital quickly to fund new and better projects.
Here are some more benefits to invoice factoring:
1. You gain working capital without adding debt or diluting your equity
2. You can finally begin to take advantage of early payment discounts from suppliers for prompt payment
3. You can purchase equipment that will increase your profitability
4. It can protect and improve your credit ratings
5. It can increase your sales through credit extensions
6. And most importantly, it allows you to focus on the success of your business instead of worrying about your cash flow.
- hope that helps!
Slow-down hitting commercial real estate?
The scope of our economic troubles seems wider and deeper than many of us want to admit. If you are a real estate owner looking to refinance your current property, sooner rather than later may be best option. I recommend you do your homework now and explore all of your options.
For the full article, go to the wall street journal article.
Here’s a summary:
Cracks are starting to show in commercial construction.
For the second month in a row, the Commerce Department reported a decline in spending on nonresidential construction — which includes everything from hospitals to office parks to shopping malls. The report yesterday showed construction spending fell 1.7% in January from December, the steepest drop in 14 years. While residential construction accounted for a big part of the decline, spending on nonresidential construction slid 0.8%.
Meanwhile, there may be an oversupply of shopping malls and office buildings after a period of intensive construction. It adds up to bad news for employment, the economy and investors.
While the boom in commercial construction wasn’t as dramatic as in home building, the impact of a slowdown on the economy could be significant. Nonresidential construction accounted for 3.6% of gross domestic product in the fourth quarter of 2007, up from 2.5% five years ago and the most since the second quarter of 1988, according to Moody’s Economy.com.
As home construction got caught in a downward spiral last year, nonresidential construction continued to expand at a healthy clip. Spending on nonresidential structures rose 16% in 2007, the biggest four-quarter increase since 1984, according to Morgan Stanley.
Signs of trouble cropped up at the end of the year. As credit markets tightened, office space sold in the fourth quarter dropped 42% from a year earlier, and sales of large retail properties declined 31%, says Real Capital Analytics, a New York real-estate research group.
If spending continues to slow, construction workers, who are reeling from the housing slowdown, face more layoffs. Construction jobs made up 5.4% of nonfarm payrolls in January. While that’s down from a peak of 5.7% in April 2006, it’s still above the long-term average of 4.9%, say economists at Payden & Rygel in Los Angeles, leaving room for more job losses.
Nonresidential construction payrolls, down 2.7% in January from their recent peak in March, posted year-over-year declines in December and January, the first such drops since August 2004. A construction slowdown will be especially tough on specialty-trade contractors, such as plumbers, painters and electricians, who account for about two-thirds of overall construction payrolls. This could spell trouble for consumer spending, which accounts for two-thirds of the U.S. economy.
Another problem: Property values of commercial real estate are declining. A Moody’s index of commercial real-estate values fell 1.5% in December from the previous month. It was the fourth steepest monthly decline in the seven-year history of the index, which nearly doubled from the end of 2000 through October.
Moody’s expects a peak-to-trough decline of 15% to 20% in commercial real-estate values, returning prices to where they stood about four years ago. Goldman Sachs Group Inc. analysts have projected a drop of as much as 26%.
The outlook is souring. Retailers have reported a slowdown in sales. Wal-Mart Stores Inc. and J.C. Penney Co., among others, have pared expansion plans. Electronics seller Best Buy Co. has reined in its quarterly earnings forecast. Talbots Inc., Movie Gallery Inc.’s Hollywood Video and numerous home-furnishings retailers have announced store closings. Others, including Bombay Co., have liquidated under bankruptcy protection.
_______
My company, Bedrock Financial Group, LLC. is a small business financing firm which can help you determine the best option for purchasing or refinancing your property.
Gas prices poised for spring spike
Gas prices jumped on Friday to their highest level since June. Analysts are suggesting this may be a preview of a coming Spring price surge.
Get the full article at: http://www/news.yahoo.com/s/ap/20080223/ap_on_bi_ge/oil_prices
There appears to be some economists that are suggesting that prices will remain less than $3.20 on a national average through the spring. With the economy positioned, if not already in a recession, rising gas prices does not bode well.
Barring a major supply disruption, or a war-related disruption (possible), small business owners who operate fleets of vehicles may want to budget for rising gas costs. Anticipating a spike, may put your business in a better cash state, than expecting prices to remain stable. Just too much uncertainty for me to be very optimistic.
For more small business resources, look at our website http://www.bedrockfinancing.com
What is a Merchant Cash Advance?
Merchant Cash Advance is a type of business loan which is usually presented as being a factoring product, where a Cash Advance company will review a merchants credit card processing statements in order to determine how much revenues are coming into a merchants business via the merchants credit card revenues / payments / sales, (they will also look at how much revenue is streaming into the business from cash & check payments / sales) they then purchase future credit card payments to the merchant at a discount.
For example: if a merchant is processing an average of $10,000 each month, when the merchant is approved the cash advance company will pay the merchant $10,000 (essentially giving the merchant a $10,000 cash advance) for anywhere from $11,200 to $15,500 (or more) of their future credit card sales income.
Is this right for your business?
Check out my site at http://www.bedrockfinancing.com to find out more information.
End the recession watch…It may already be here
Weakness in the service sector has caused more experts to declare that the economy has entered a downturn. Retail, real estate, finance, and construction industries were hit hardest.
The full article is at: http://money.cnn.com/2008/02/05/news/economy/recession/
Although more fed rate cuts appear to be expected, few experts appear to be seeing a quick turn-around. The market appears to be looking for the fed to make a significant cut in rates, but opinions vary about whether a big rate cut would be wise or beneficial in the long term.
Currently, the future market is anticipating a 100% chance of a quarter-point cut in March, and a 28% chance of a half-point cut during the month.
Although it appears banks are being a little tighter on loans, there are still great programs out there for business owners. Please visit our site, www.bedrockfinancing.com for a list of programs and more helpful information.
Oil Prices Another Signal Of Trouble
The AFP is reporting that world oil prices fell amid concerns of a drop in energy demand. This is largely in part because of the weakness that the US economy is showing and the world is believing.
Further interest rate cuts may not bolster the economy, and they will only hurt the value of the dollar. Just another sign that a recession is on the way…spin it however you want.
