5 Ways and Steps to Improve Your E-Commerce Business Through FINANCING

As predicted, E-commerce has boomed (and is still booming). People buy not just through PCs but through phones and tablets as well. Buyers loved the idea! E-commerce’s market and competition is huge, now how do you keep up and advance?

The word is “empathy”-put yourself in your customers’ shoes! Your goods are wonderful, your target market is all credit classes yet your customers are just coming from the mid to upper scales. Say you sell apparel-everyone needs clothing. Come on, you don’t want to be deprived of clothing purchases just because you do not have a credit card or have a low credit limit, do you? NOT EVERYONE HAS/CAN HAVE A CREDIT CARD.

That’s where financing comes in. I know, you’ve heard about it. House, auto, cash, etc.-e-commerce financing is different. How do you benefit from it?

Not everyone can get a credit card. However, not everyone who owns credit cards pay their credit cards. How do you help the minimum waged guy who’s got a job, good payment records and a guarantor?

Easy!

#1 Forget you are JUST helping the guy -Look, the guy helps you and your business in return! If you offer a financing payment method for an eBay or Amazon product (which cannot be purchased easily without credit cards), you get a big chunk of the market-those without credit cards.

# 2 Know the types of e-commerce financing -Financing is making a product affordable for your customers while earning yourself MORE SALES at HIGHER VALUES. There are two ways you can venture in e-commerce financing:

A. Plain Financing – You just find the leads, verify their payment capabilities, and finance no particular product-anything goes.

B. Retail Financing – You have particular stuff/service to sell and you offer financing as a payment method.

#3 Know your clientele -Now, there are three general categories: (1) Those who’ve got 680-850 credit scores with high credit limits (not your financing target); (2) Those with 600-680 scores, typically with $600-limited credit cards or GE capital (the perfect targets!); and, (3) Those with 300-599 scores, NO credit card (great for lay away programs*)

#4 Know your risks as a financier -Financing wouldn’t be around if it isn’t profitable. However, as in any business venture, there are risks you would have to deal with. One of which (but rarely happens) is when a customer screws you upon shipping the product-like, they get it and don’t pay you or get it and opt for a return/exchange. Worry not since you can…

#5 Secure Yourself & Your Business-Issue in #4: What if a customer screws you? That is exactly why you charge double or triple the worth of the product you finance-to fill in such gaps expenses. That is not the only way, however, to secure your financing business (whether plain or retail). As a customer shows his interest in being financed, he fills out a form for your evaluation and signs an electronic (since we’re talking e-commerce here)/ e-signing agreement that states your ‘financing terms & conditions’ such as his paying for the restocking fee, etc.

Now, there you have it: the basic steps to your e-commerce financing success. Also note that you won’t have to use money from your own pocket to start financing. You can have your financing financed by banks and “middle men” a.k.a. financing firms (whom you’d be liable to) depending on your business situation (number of years, operating costs, turnovers, etc.).

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Venture Leasing – How to Get Financing For Custom-Made Equipment

Tiffany Charles, CFO of Medtech Solutions, was facing a difficult challenge. Medtech, a venture-backed startup in business for two years, needed test equipment critical to its operations. While test equipment is widely available for most test applications, the tests to be conducted at Medtech required custom-made equipment offered by only one US manufacturer. Medtech had raised sufficient venture capital to fund most of its research and development projects, but the custom-made equipment’s cost would require an unacceptably large percentage of Medtech’s research budget, limiting investments in other key areas. Tiffany explored manufacturer financing and contacted several leasing firms, but to no avail. How would Tiffany acquire the equipment that Medtech needed without using internal funds critical for other projects?

Why custom-equipment financing is so difficult to obtain

Potential financing sources approach requests for this type financing cautiously. Most financing for venture-backed startups involves a high degree of risk in comparison to financing established companies. Financing sources that extend credit to venture-backed startups are accustomed to accepting startup risks. These risks include financing companies that are relatively new to their markets, that have negative cash flow, and that rely on venture capital sponsorship to stay afloat. Notwithstanding these risks, most financing sources are reluctant to take on the added risk of financing equipment that they may be required to re-market one day, but are unable to move. Many of them know that a small percentage of the transactions they underwrite will not work out, requiring them to repossess and re-marketing the equipment to recover as much of their investment as possible. Custom-equipment presents a huge challenge in that it offers virtually no backstop should all other exit channels fail.

Whether or not a venture-backed startup can obtain financing for custom-equipment might depend on several factors:

The dollar amount and percentage that the equipment represents of the total to be financed
Whether other assets can be offered as collateral to secure the transaction
The startup’s overall credit profile
Whether management can convince the financing company that the equipment is critical to operations and/or profitability
Whether an aftermarket exists and whether there is any prospect of realizing value from the equipment if re-marketing is necessary
Whether the vendor offers equipment buy-back, trade-in, or re-marketing support, if desired.
How do savvy startups overcome this financing challenge?

To improve the odds of obtaining financing, startups should take the following steps:

Stick with financing firms that specialize in financing venture-backed startups. These companies understand venture risks and are in a better position to evaluate transactions involving custom-equipment.

Research the after-market for the equipment by talking to the vendor and looking for used equipment brokers/dealers online. Often, the vendor can provide resale information and used equipment resellers can be spotted online via advertisements and postings. Make sure you provide your re-marketing research to the financing firm.

Explore re-marketing assistance with the vendor, including equipment buy-backs, trade-ins, or other vendor re-marketing arrangements. Depending on the vendor, customers may be able to lobby for special re-marketing arrangements as a purchase incentive.

Consider other assets that the startup might pledge to support the transaction. The main concern of the financing source is being able to exit the transaction should the startup default in making payments. By offering additional collateral to support the transaction, the startup may be able to alleviate or greatly reduce this concern.

Try to schedule custom-equipment purchases along with other equipment that has an established aftermarket, such that the custom-equipment represents a minority of the equipment being acquired. Similar to offering additional equipment as collateral, by bundling custom-equipment with readily re-marketable equipment, the overall collateral value of the bundle might be sufficient to calm the financing provider’s concerns.

Highlight the critical nature of the equipment. If it is critical to the startup’s profitability or operations and loss of the equipment’s use would put the startup in a significantly weaker position, the prospect of obtaining financing is somewhat improved. The rationale is that the financing source will have a relative advantage vis-à-vis other creditors in any company wind-down because the equipment might be needed to restructure the company or to assist other creditors in their recovery. While this is not a primary reason for financing custom-made equipment, it is a factor considered by most financing sources in making a final decision.
If your startup needs financing for custom-made equipment, use these tips and insights to navigate your search.

George Parker is a twenty-five year industry leader, co-founder and Executive Vice President of Leasing Technologies International, Inc. He is author of several articles and e-books, including “Using Venture Leasing As A Competitive Weapon” and “101 Equipment Leasing Tips”.

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Alternative Financing

Alternative bank financing has significantly increased since 2008. In contrast to bank lenders, alternative lenders typically place greater importance on a business’ growth potential, future revenues, and asset values rather than its historic profitability, balance sheet strength, or creditworthiness.

Alternative lending rates can be higher than traditional bank loans. However, the higher cost of funding may often be an acceptable or sole alternative in the absence of traditional financing. What follows is a rough sketch of the alternative lending landscape.

Factoring is the financing of account receivables. Factors are more focused on the receivables/collateral rather than the strength of the balance sheet. Factors lend funds up to a maximum of 80% of receivable value. Foreign receivables are generally excluded, as are stale receivables. Receivables older than 30 days and any receivable concentrations are usually discounted greater than 80%. Factors usually manage the bookkeeping and collections of receivables. Factors usually charge a fee plus interest.

Asset-Based Lending is the financing of assets such as inventory, equipment, machinery, real estate, and certain intangibles. Asset-based lenders will generally lend no greater than 70% of the assets’ value. Asset-based loans may be term or bridge loans. Asset-based lenders usually charge a closing fee and interest. Appraisal fees are required to establish the value of the asset(s).

Sale & Lease-Back Financing. This method of financing involves the simultaneous selling of real estate or equipment at a market value usually established by an appraisal and leasing the asset back at a market rate for 10 to 25 years. Financing is offset by a lease payment. Additionally, a tax liability may have to be recognized on the sale transaction.

Purchase Order Trade Financing is a fee-based, short-term loan. If the manufacturer’s credit is acceptable, the purchase order (PO) lender issues a Letter of Credit to the manufacturer guaranteeing payment for products meeting pre-established standards. Once the products are inspected they are shipped to the customer (often manufacturing facilities are overseas), and an invoice generated. At this point, the bank or other source of funds pays the PO lender for the funds advanced. Once the PO lender receives payment, it subtracts its fee and remits the balance to the business. PO financing can be a cost-effective alternative to maintaining inventory.

Non-Bank Financing

Cash flow financing is generally accessed by very small businesses that do not accept credit cards. The lenders utilize software to review online sales, banking transactions, bidding histories, shipping information, customer social media comments/ratings, and even restaurant health scores, when applicable. These metrics provide data evidencing consistent sale quantities, revenues, and quality. Loans are usually short-term and for small amounts. Annual effective interest rates can be hefty. However, loans can be funded within a day or two.

Merchant Cash Advances are based on credit/debit card and electronic payment-related revenue streams. Advances may be secured against cash or future credit card sales and typically do not require personal guarantees, liens, or collateral. Advances have no fixed payment schedule, and no business-use restrictions. Funds can be used for the purchase of new equipment, inventory, expansion, remodeling, payoff of debt or taxes, and emergency funding. Generally, restaurants and other retailers that do not have sales invoices utilize this form of financing. Annual interest rates can be onerous.

Nonbank Loans may be offered by finance companies or private lenders. Repayment terms may be based on a fixed amount and a percentage of cash flows in addition to a share of equity in the form of warrants. Generally, all terms are negotiated. Annual rates are usually significantly higher than traditional bank financing.

Community Development Financial Institutions (CDFIs) usually lend to micro and other non-creditworthy businesses. CDFIs can be likened to small community banks. CDFI financing is usually for small amounts and rates are higher than traditional loans.

Peer-to-Peer Lending/Investing, also known as social lending, is direct financing from investors, often accessed by new businesses. This form of lending/investing has grown as a direct result of the 2008 financial crisis and the resultant tightening of bank credit. Advances in online technology have facilitated its growth. Due to the absence of a financial intermediary, peer-to-peer lending/investing rates are generally lower than traditional financing sources. Peer-to-Peer lending/investing can be direct (a business receives funding from one lender) or indirect (several lenders pool funds).

Direct lending has the advantage of allowing the lender and investor to develop a relationship. The investing decision is generally based on a business’ credit rating, and business plan. Indirect lending is generally based on a business’ credit rating. Indirect lending distributes risk among lenders in the pool.

Non-bank lenders offer greater flexibility in evaluating collateral and cash flow. They may have a greater risk appetite and facilitate inherently riskier loans. Typically, non-bank lenders do not hold depository accounts. Non-bank lenders may not be as well known as their big-bank counterparts. To ensure that you are dealing with a reputable lender, be sure to research thoroughly the lender.

Despite the advantage that banks and credit unions have in the form of low cost of capital – almost 0% from customer deposits – alternative forms of financing have grown to fill the demand of small and mid-sized businesses in the last several years. This growth is certain to continue as alternative financing becomes more competitive, given the decreasing trend seen in these lenders’ cost of capital.

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Learn the Importance of a Specialised Finance Broker in Getting Development Finance

Development Finance is a specialised form of funding suitable only for professional builders and developers. This form of funding will require the assistance of a professionally qualified and expert finance broker who has the required skills and experience to negotiate the finance on your behalf.

Suitable Development Finance Projects

If you are a professional builder or property developer, you must speak to an expert finance broker, who will help you in understanding the finance strategy required to fund any of the following projects:

>> Residential construction

>> Commercial property

>> Industrial property

>> Retail property, and

>> Land subdivisions

What Information do I need to provide?

Lenders/credit providers will look at a number of areas when they are considering your loan request. You will need to present a full proposal to the lender/credit provider, and they will require you to provide the following information:

>> Your Business Plan, which should list your background, professional qualifications and your trade and project management experience

>> Your experience as a property developer

>> The location of your proposed development

>> Development Type (Residential or Commercial)

>> The profit potential of the development

>> Your financial statement of accounts and personal assets and liabilities to determine your development cash flow

>> The amount of equity that you will bring to the development project

>> Copy of the planning consent and drawings for the scheme

>> Comparable evidence for the resales

>> A suitable exit strategy

Can I get an “In Principle” Decision?

When you are applying for development finance, you should have all the required information available so that the lender/credit provider can review and assess your finance proposal. The lender/credit provider will advise you:

>> If it is possible to arrange the required finance for development project, and

>> How long it will take to obtain an “In Principle” decision (You must remember that the lender/credit provider will make the final decision)

Why Choose a Professionally Qualified and Specialised Finance Broker?

It is always wise to start the development finance process with a professionally qualified and specialised finance broker because:

>> They will help you to prepare a Business Plan, which will set out your development finance requirements in exactly the way that lenders/credit providers wish to see

>> They know what the standard requirements for development finance loans are

>> They can accommodate a much faster credit decision for you, provided that they receive from you all the required documents as soon as possible (e.g. your professional qualifications, trade qualifications and certificates and your previous building or development experience)

>> They can structure a Customised Development Finance funding strategy that will meet your needs regardless of the size or complexity of the building or development project

>> Through their extensive network of specialised lenders/credit providers and private lenders, they are better equipped to offer you access to funds for your required building or development project

>> They can help you to secure the required finance so that you can fund all the stages of the construction cycle:

1. From financing the initial purchase of the land

2. Through to progressive construction draw-downs, and

3. To enable you to cover all the approval costs

So, this is what you, as a professional builder or developer, need to know about development finance. I sincerely hope this article helps you to understand why you need to seek assistance from only a professionally qualified and specialised finance broker.

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Shoe Repairs And Several Other Things When I Was 7

Shoe Repairs And Several Other Things When I Was 7
My Dad repaired most of our shoes believe it or not, I can hardly believe it myself now. With 7 pairs of shoes always needing repairs I think he was quite clever to learn how to “Keep us in shoe Leather” to coin a phrase!

He bought several different sizes of cast iron cobbler’s “lasts”. Last, the old English “Laest” meaning footprint. Lasts were holding devices shaped like a human foot. I have no idea where he would have bought the shoe leather. Only that it was a beautiful creamy, shiny colour and the smell was lovely.

But I do remember our shoes turned upside down on and fitted into these lasts, my Dad cutting the leather around the shape of the shoe, and then hammering nails, into the leather shape. Sometimes we’d feel one or 2 of those nails poking through the insides of our shoes, but our dad always fixed it.

Hiking and Swimming Galas
Dad was a very outdoorsy type, unlike my mother, who was probably too busy indoors. She also enjoyed the peace and quiet when he took us off for the day!

Anyway, he often took us hiking in the mountains where we’d have a picnic of sandwiches and flasks of tea. And more often than not we went by steam train.

We loved poking our heads out of the window until our eyes hurt like mad from a blast of soot blowing back from the engine. But sore, bloodshot eyes never dampened our enthusiasm.

Dad was an avid swimmer and water polo player, and he used to take us to swimming galas, as they were called back then. He often took part in these galas. And again we always travelled by steam train.

Rowing Over To Ireland’s Eye
That’s what we did back then, we had to go by rowboat, the only way to get to Ireland’s eye, which is 15 minutes from mainland Howth. From there we could see Malahide, Lambay Island and Howth Head of course. These days you can take a Round Trip Cruise on a small cruise ship!

But we thoroughly enjoyed rowing and once there we couldn’t wait to climb the rocks, and have a swim. We picnicked and watched the friendly seals doing their thing and showing off.

Not to mention all kinds of birdlife including the Puffin.The Martello Tower was also interesting but a bit dangerous to attempt entering. I’m getting lost in the past as I write, and have to drag myself back to the present.

Fun Outings with The camera Club
Dad was also a very keen amateur photographer, and was a member of a camera Club. There were many Sunday photography outings and along with us came other kids of the members of the club.

And we always had great fun while the adults busied themselves taking photos of everything and anything, it seemed to us. Dad was so serious about his photography that he set up a dark room where he developed and printed his photographs.

All black and white at the time. He and his camera club entered many of their favourites in exhibitions throughout Europe. I’m quite proud to say that many cups and medals were won by Dad. They have been shared amongst all his grandchildren which I find quite special.

He liked taking portraits of us kids too, mostly when we were in a state of untidiness, usually during play. Dad always preferred the natural look of messy hair and clothes in the photos of his children.

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What Are The Greatest Changes In Shopping In Your Lifetime

What are the greatest changes in shopping in your lifetime? So asked my 9 year old grandson.

As I thought of the question the local Green Grocer came to mind. Because that is what the greatest change in shopping in my lifetime is.

That was the first place to start with the question of what are the greatest changes in shopping in your lifetime.

Our local green grocer was the most important change in shopping in my lifetime. Beside him was our butcher, a hairdresser and a chemist.

Looking back, we were well catered for as we had quite a few in our suburb. And yes, the greatest changes in shopping in my lifetime were with the small family owned businesses.

Entertainment While Shopping Has Changed
Buying butter was an entertainment in itself.
My sister and I often had to go to a favourite family grocer close by. We were always polite as we asked for a pound or two of butter and other small items.

Out came a big block of wet butter wrapped in grease-proof paper. Brought from the back of the shop, placed on a huge counter top and included two grooved pates.

That was a big change in our shopping in my lifetime… you don’t come across butter bashing nowadays.

Our old friendly Mr. Mahon with the moustache, would cut a square of butter. Lift it to another piece of greaseproof paper with his pates. On it went to the weighing scales, a bit sliced off or added here and there.

Our old grocer would then bash it with gusto, turning it over and over. Upside down and sideways it went, so that it had grooves from the pates, splashes going everywhere, including our faces.

My sister and I thought this was great fun and it always cracked us up. We loved it, as we loved Mahon’s, on the corner, our very favourite grocery shop.

Grocery Shopping
Further afield, we often had to go to another of my mother’s favourite, not so local, green grocer’s. Mr. McKessie, ( spelt phonetically) would take our list, gather the groceries and put them all in a big cardboard box.

And because we were good customers he always delivered them to our house free of charge. But he wasn’t nearly as much fun as old Mr. Mahon. Even so, he was a nice man.

All Things Fresh
So there were very many common services such as home deliveries like:

• Farm eggs

• Fresh vegetables

• Cow’s milk

• Freshly baked bread

• Coal for our open fires

Delivery Services
A man used to come to our house a couple of times a week with farm fresh eggs.

Another used to come every day with fresh vegetables, although my father loved growing his own.

Our milk, topped with beautiful cream, was delivered to our doorstep every single morning.

Unbelievably, come think of it now, our bread came to us in a huge van driven by our “bread-man” named Jerry who became a family friend.

My parents always invited Jerry and his wife to their parties, and there were many during the summer months. Kids and adults all thoroughly enjoyed these times. Alcohol was never included, my parents were teetotallers. Lemonade was a treat, with home made sandwiches and cakes.

The coal-man was another who delivered bags of coal for our open fires. I can still see his sooty face under his tweed cap but I can’t remember his name. We knew them all by name but most of them escape me now.

Mr. Higgins, a service man from the Hoover Company always came to our house to replace our old vacuum cleaner with an updated model.

Our insurance company even sent a man to collect the weekly premium.

People then only paid for their shopping with cash. This in itself has been a huge change in shopping in my lifetime.

In some department stores there was a system whereby the money from the cash registers was transported in a small cylinder on a moving wire track to the central office.

Some Of The Bigger Changes
Some of the bigger changes in shopping were the opening of supermarkets.

• Supermarkets replaced many individual smaller grocery shops. Cash and bank cheques have given way to credit and key cards.

• Internet shopping… the latest trend, but in many minds, doing more harm, to book shops.

• Not many written shopping lists, because mobile phones have taken over.

On a more optimistic note, I hear that book shops are popular again after a decline.

Personal Service Has Most Definitely Changed
So, no one really has to leave home, to purchase almost anything, technology makes it so easy to do online.
And we have a much bigger range of products now, to choose from, and credit cards have given us the greatest ease of payment.

We have longer shopping hours, and weekend shopping. But we have lost the personal service that we oldies had taken for granted and also appreciated.

Because of their frenetic lifestyles, I have heard people say they find shopping very stressful, that is grocery shopping. I’m sure it is when you have to dash home and cook dinner after a days work. I often think there has to be a better, less stressful way.

My mother had the best of both worlds, in the services she had at her disposal. With a full time job looking after 9 people, 7 children plus her and my dad, she was very lucky. Lucky too that she did not have 2 jobs.

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What We Have Here Is A Failure To Communicate

The results of this past election proved once again that the Democrats had a golden opportunity to capitalize on the failings of the Trump Presidency but, fell short of a nation wide mandate. A mandate to seize the gauntlet of the progressive movement that Senator Sanders through down a little over four years ago. The opportunities were there from the very beginning even before this pandemic struck. In their failing to educate the public of the consequences of continued Congressional gridlock, conservatism, and what National Economic Reform’s Ten Articles of Confederation would do led to the results that are playing out today.. More Congressional gridlock, more conservatism and more suffering of millions of Americans are the direct consequences of the Democrats failure to communicate and educate the public. Educate the public that a progressive agenda is necessary to pull the United States out of this Pandemic, and restore this nations health and vitality.

It was the DNC’s intent in this election to only focus on the Trump Administration. They failed to grasp the urgency of the times. They also failed to communicate with the public about the dire conditions millions have been and still are facing even before the Pandemic. The billions of dollars funneled into campaign coffers should have been used to educate the voting public that creating a unified coalition would bring sweeping reforms that are so desperately needed. The reality of what transpired in a year and a half of political campaigning those billions of dollars only created more animosity and division polarizing one extreme over another.

One can remember back in 1992 Ross Perot used his own funds to go on national TV to educate the public on the dire ramifications of not addressing our national debt. That same approach should have been used during this election cycle. By using the medium of television to communicate and educate the public is the most effective way in communicating and educating the public. Had the Biden campaign and the DNC used their resources in this way the results we ae seeing today would have not created the potential for more gridlock in our government. The opportunity was there to educate the public of safety protocols during the siege of this pandemic and how National Economic Reform’s Ten Articles of Confederation provides the necessary progressive reforms that will propel the United States out of the abyss of debt and restore our economy. Restoring our economy so that every American will have the means and the availability of financial and economic security.

The failure of the Democratic party since 2016 has been recruiting a Presidential Candidate who many felt was questionable and more conservative signals that the results of today has not met with the desired results the Democratic party wanted. Then again? By not fully communicating and not educating the public on the merits of a unified progressive platform has left the United States transfixed in our greatest divides since the Civil War. This writers support of Senator Bernie Sanders is well documented. Since 2015 he has laid the groundwork for progressive reforms. He also has the foundations on which these reforms can deliver the goods as they say. But, what did the DNC do, they purposely went out of their way to engineer a candidate who was more in tune with the status-quo of the DNC. They failed to communicate to the public in educating all of us on the ways our lives would be better served with a progressive agenda that was the benchmark of Senators Sanders Presidential campaign and his Our Revolution movement. And this is way there is still really no progress in creating a less toxic environment in Washington and around the country.

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