business banking

Don’t Believe the Hype About Online Business

Running a online venture is so easy anyone can do it – sitting around in your pyjamas answering a few emails – right? Making money whilst sipping a margarita on a sunlit beach is everyone’s idea of a successful business – but is it all hype?

I hate to break it to you but to make an online business successful, you need to realize that hype is just that – hype. Let’s explore some common misconceptions:

There’s less competition - Compared to traditional businesses, competition online is fierce and fast. You have 3 eyeball seconds to interest your customer in your offering. They can move on with the click of the mouse and they will, unless you can draw them in to enjoy your particular brand of the online experience.

There’s no overhead: The only overhead you don’t have in online business is retail rent, that is if your business sells products. Unless you are running your business out of your home, which is a great way to start, your business will need premises eventually as well as staff and all the other business tools traditional businesses use.

There are no barriers to entry: It’s true that anyone can start a website, but making it successful does have barriers to entry. For example:

Trust – Many consumers still don’t trust websites, how will you build trust in a sea of websites?
If you build it, will they come? – It takes time for a website to list on search engine results. In the meantime, how will your customers know your website exists?
Difficult Suppliers – Each industry is different but some suppliers will refuse to sell to you when they find out you’re online.
Price – Remember my first point about competition? Price comparison online is easy, and the switch for a $2 saving is just a mouse click away.

I can work in my pyjamas: You will definitely work in your pyjamas, late at night catching up with overseas suppliers in a different time zone!

I won’t need to pay anyone: If you want to start an online business, chances are that you are awesome with computers. But what about HTML, SEO, eyeball seconds, conversions vs. visits, abandoned carts, FTP, API, product feeds? Eventually, you will need to hire an expert or two.

Don’t get me wrong, I love online businesses and there will be points in the life of your online business when you have a clear advantage over the bricks and mortar competition. But the truth of it is that a successful online business still needs investment in time and money, commitment, passion and a drive to solve problems quickly.

The good news is that there are solutions to every business problem, so if you have a passion for online business then I say go for it! Just make sure you enter the sector with your eyes wide open, plenty of investment dollars, time, patience and a willingness to see past the hype – in the end it’s worth it.

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6 Questions To Be Answered By Every Online Business

Every successful online business has a plan of where they are going and how they are going to get there. Where will your business be when it’s most successful? How can you ensure that you get there? Can you answer these 6 questions?

1. Who Are You And What is Your Business?

Is your online business as just a hobby? Or is it a serious business that you’ll stick with even if the going gets tough? The internet can be impersonal business environment. Your website visitors will want to know who you are. Your ‘About Me’ page can become one of the top read pages on your website. Tell people who are, why you’ve built your online business and how it can help them.

2. What Do You Offer?

What solutions does your online business provide? Is it freedom? Maybe more time? Or is it something else? What problem can your product or service fix for your customers? If you can answer that, your journey towards having a successful business will be quicker.

3. Who Is Your Customer?

Knowing your ideal customer is an important part of running a successful online business. Create a customer avatar so that you can look at it and know exactly who you’re doing it for. To find that “perfect” prospect do your research to discover their desires, emotions, demographics and other physical and mental personality traits.

4. What Makes Your Business Different?

Generally, another online business will be offering something like yours or close to it. You have to make your offer for a product or service more attractive to buy from you than it is to buy from one of your competitors. What makes you and your business stand out so that it’s better, different, or special?

5. How Will You Deliver It?

It’s important to know how you’ll deliver your product or service to your audience. Will you sell a physical product that’s delivered to the customer’s front door? Or a digital product that’ downloaded instantly to the customer’s computer once they have bought it? Perhaps it will be both? But without knowing how you’ll deliver what you’re selling, it will be difficult to succeed in your online business.

6. How Will You Determine Success?

A successful online business can mean different things to different people. Do you want to sell a specific number of products, get more website traffic, enhance your online reputation, broaden your brand or something else? If you don’t know what you want to achieve, how will you know if have ever achieved it?

Choosing The Best Business Bank Your Business Can Rely On

Most businesses today are offered by banks with different services and features to help their business expand and grow. Organizations are enticed to open an account with these banks. From business loans and credit facilities to other financing services, banks are continuously introducing new solutions that can help organizations increase or sustain their funds which they can use for various purposes. Because of this, it has become more difficult to choose the best business bank that can live up to its claims and promises. Certain qualities and features, however, can help you identify a good, reliable, and trustworthy business bank. This will be your guide to ensure you have chosen the right one.

First, choose a bank with sufficient security for your funds. A good business bank will have adequate coverage. It will be properly insured to help protect the interest of all their depositors and clients. This will also lead to ease of deposit. The best business banks will enable you to deposit cash or checks, even if they don’t have a branch near you. They will allow you to do this through their mobile app or website. Another option would be through home or office deposit services which can make check deposits quick and simple.

Another thing to consider is the reasonable minimum balance requirements. Most business bank accounts require depositors to maintain a minimum balance. Failure to do so will result in additional charges you will have to pay. The best bank will only call for a minimum balance requirement that people can comfortably afford. Additionally, this will lead to low fees or charges. The most sought-after banks won’t charge you any fees for basic account transactions.

Check if the bank you choose has good interest rates. The best bank will offer attractive rates for the amount of money you will deposit with them. They will also charge reasonable rates for the money you borrow via credit card or loan. Ideally, the bank should pay higher-than-average interest on your deposits and charge lower-than-average interest on your debts.

A bank with modern and convenient online banking features is also a good choice. There is no doubt that the different online services of banks today provide a lot of ease and convenience to account holders. The best business bank will allow you to pay your bills and transfer money online for free. It will also be equipped to process these transactions quickly and easily.

Banking Features To Look For When Opening A Business Bank Account

A bank is one of the most reliable partners any business can have. Regardless of its size, any organization will benefit greatly from many of the services and solutions provided by banks such as loans, letters of credits, guarantee letters, etc.

The advantages you can experience from a bank though will depend greatly on the financial institution you will choose. This is because aside from the benefits they offer, some banks will have features that will also help businesses in various ways.

Below are some of the important banking features you should look for when opening a business bank account:

Online banking. Online banking is a key feature that all business owners should look for. Busy small business owners can save a lot of time by using online banking for paying bills, doing bank transfers, checking balances, and even accepting payments. They or they employees won’t have to spend time going to the bank and waiting in line for doing these. Most banks today offer this solution for free and when opening an account, just make sure the institution offers a safe and secure online banking service. Its website should not suffer from regular glitches and has a good and reliable loading speed.

They have little to no monthly fees. If you make the mistake of opening a business bank account that come with monthly fees, a portion of your hard-earned money will simply go to paying for these fees. To make sure you will enjoy this service, find out what this free banking offer includes. Check if each transaction is free no matter what the balance in your account may be or if there a minimum balance requirement. You would also do well to find out if printed checks for the account, cash deposits, and cashing checks are also free. Don’t forget to ask about ATM fees, debit cards and bill payments as well, especially if these are services your business needs. Choose a bank and an account that includes all of these for free.

The authority of the local branch to grant loans. Lastly, most businesses need some extra funds from time to time to keep things flowing smoothly. You can plan for any unexpected credit needs by choosing a bank that allows branch personnel to make credit decisions in the local branch instead of always referring to their main office. This is a free feature that can be a really valuable convenience for business owners who may need money in a hurry. With this feature, you won’t have to wait for weeks to receive the approval of an emergency loan you applied for which your business really needs.

Business Banking Tips For Beginners

Are you considering opening up a business? If so, then you should start thinking about your business banking needs. The kind of account you need often depends on a few factors. You may want to find a bank that can offer you additional things like merchant services, payroll or bill pay. You should consider opening not only a checking account, but also a savings account.

When you go into a bank to open up a business account, you will need a few items. Not only will you need the standard things for opening a checking account, like identification and and opening deposit, you will also need some sort of proof of identification for the business. This includes things like a fictitious business name statement (for a sole proprietorship) or your articles of incorporation (for a corporation).

Take a close look at what your potential bank has to offer for businesses. Many banks can give you help in many aspects. Business bill pay is often convenient, as it typically lets you manage all of your bills through the bank’s website, instead of having to keep track of bills in many different places. Payroll services may also be offered though a bank, so if you will have employees and a need for payroll, check with your bank. Merchant services are also available through banks, too. If you would like to accept credit cards, then look into options for merchant services.

Another things that you may want to consider is opening up not only a checking account for the business, but also a savings account. Savings accounts are important to have, as any successful business should start saving as early as possible.

To learn more about business banking, look around online. The internet is a great way to research your local and national banking options.

Obtaining a Business Bank Account With Bad Credit

Operating a business can be a struggle in today’s economy; this is doubly difficult for the business entrepreneur that has a history of bad credit. Nearly one hundred percent of banks will perform a credit check before approving a business bank account application. If indebtedness, bankruptcy, or foreclosure haunts your past, it could decimate your chances of opening a business bank account.

Financial institutions utilize an in-house credit system dubbed the “Che x System.” Every late payment, overdraft concurrence, or other similar issue credited to your account lowers this in-house credit score and undercuts your chances of obtaining a business bank account. Luckily, there are some steps that you can take to increase your likelihood of obtaining a business bank account with bad credit.

Probationary Bank Account

This is less than an ideal solution to obtaining your business bank account with bad credit history; however, for some individuals, this is the only available option. These types of bank accounts carry strict limitations and usually include various fees and service charges. On average, if an individual can maintain one of these probationary accounts for six months without incident, he can graduate to a more sensible and basic account package that have fewer limitations are more incentives.

A Business Bank Account for Bad Credit

There is such a thing as a specific business account for companies with bad credit. These are usually offered by online banks and used as a stepping block to repair your credit history. Typically, these accounts are nearly identical to other business accounts but have some restrictions and incur higher fees and surcharges. It is stressed that this should be only a temporary solution that is utilized until your credit history is restored. Many businesses and individuals dislike this approach due to the lack of on-site locations and person-to-person business interactions. Not every business is well-suited to use online banking options and this can make it quite difficult to manage business accounts for an extended period of time.

Ordinarily, once you’ve completed a tour with a bad credit business bank account, you can apply with most any traditional financial institution to advance your business account into good standing.

Second Chance Accounts

These second chance business accounts can be tricky to navigate. Many require a large deposit so that the account is considered secure but only offer a debit card; check writing privileges are suspended and credit card payment processing is not guaranteed. Before obtaining this type of account, review the terms and conditions; oftentimes, this type of business account will not transfer into a standard account and can cause other difficulties associated with bad credit.

D.B.A. Accounts

This type of account is particularly useful if you have bad credit but still have an existing relationship with a financial institution. D.B.A., or “doing business as,” accounts are typically used by individuals since these don’t require a tax or employer ID numbers and rely heavily on an individual’s personal information. Beware of difficulties come tax time since these accounts are also used as personal accounts. Separating business and private transactions can be a long, drawn out process that results in miss deductions and incomplete business records.

How to Find Business Banking Online

When it comes to online business banking it is necessary to know what to look for when choosing a bank and enjoy the advantages of getting it right. A good relationship is essential in online business banking. It is important to invest time in choosing the right bank the first place.

Banks offer different business banking services and the fees they charge as well. Some have special teams who deal with business accounts and useful information for start up business.

Choose the right bank

Before making a decision it is a good idea to compare at least 2 banks though many people open their business account with the same bank that holds their personal account. Bank charges vary in the services they offer, so it is best if you compare and get the best all around deal. If you go online and search for business banking, use some business account finder to compare deals. You may even want to choose your business account on the bank’s ethical or religious standing – investment policies issues such as human rights and environmental responsibility.

When dealing with business banking, it is a good idea to ask about:

If the bank has a dedicated team for small businesses

Services they offer

Amount of services

How do they charge for each transaction

If there are additional charges (some banks charge if you exceed the overdraft limit)

If they have local branches – especially if you have to make transactions every week

If there are special offers for start up businesses or for new accounts.

Choose business banking account

Current Account- For frequent transactions includes payments or receipts. A good option if you pay interest and late payment fees on credit balances, but not all banks offer this.

Readily Access Deposit Account- Any cash not needed for frequent transactions. These can be put into your current account so you can check it anytime.

Term Deposit Account – for long term funds

Foreign Currency Account – for overseas trading

Loan Account – for taking out loans

Merchant Account – for businesses so you can accept credit and debit card payments and transactions.

All major banks nowadays offer online business banking. Doing it online is a more efficient way of managing your business accounts. You can check your balances and view statements, transfer money from one account to another, pay suppliers online, fix regular payments such as salaries and even request for chequebook and statements. You can also download your account information and print it out for analysis.

Online business banking is cost-effective. Banks offer online banking at no extra cost!

Most businesses manage their online business banking using internet banking, you can check your account from any computer using web browser. Larger businesses are offered PC banking and require them to install a special banking software on the computer. This is an effective solution for large volume of banking transactions and link directly your accounting system to your bank.

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Get a Business Bank Account That Your Company Can Bank On

When operating a business it is always recommended you establish separate business bank accounts through which you can run your day to day business finances. This will make reconciling money in and out a great deal easier and will avoid upsetting the tax authorities by mixing your personal expenses with business expenses.

It also looks a lot more professional to write cheques that show the business name and for your customers to make payments to you in the name of your business and not you personally.

Most UK banks offer an initial period of free banking so it need not cost you a penny and in fact can actually make you money if you choose the right account.

Which business account should I choose?

Most UK banks offer business accounts so it is simply a case of assessing which features you will use the most. The ideal account is one that offers an initial period of free banking for at least 12 months. Make sure that when they say free business banking they really mean free! Check for transaction limits, some may have limits on how much cash you can deposit over the counter free of charge. Others may put limits on how many cheques you can write per month. If you exceed any stated limits they typically charge a small fee per transaction outside of the limit.

It is also worth considering the interest rate paid on any finds you hold in the account. Some businesses can hold considerable amounts of money in their account.

Assess the available business accounts until you find one that best fits the way you operate your business.

How do I manage my business bank account?

Most banks offer the ability to manage your business account directly through your local branch, over the telephone, by post or via the internet.

The internet is often the most useful way of managing your account, especially if your customers pay you by bank transfer. By using online facilities you will always have a real time view of your account.

If your business does not deal in physical cash transactions then there is often no real need to have a personal bank manager. You can bank online, receive and send payments directly to and from your account. If you receive cheque payments you can often post these directly to your business banks processing centre.

Business Savings account – Business Reserve account

It is always worth opening a reserve savings account for your business which can be linked to your main business account. This type of account typically pays a higher interest rate than the main account so you can sweep any surplus funds to this reserve business account. You might as well maximise your profit while you don’t need the money!

Switch Business Accounts to stay free

Many businesses just stick with the same old business account even after the initial free period has expired. There is no reason why you can not switch your business account to another bank that will happily offer you a new free period of banking in return for your custom.

Just make sure that if you close your old account you have informed anyone making regular payments to you that you have new account details. Many banks offer a switching service to assist with this process.

Business Credit Cards

In addition to your business account that will offer you a debit card facility you can also apply for business credit cards. A business credit card can offer various benefits. First off it offers a short term borrowing facility, typically 56 days interest free after which you will need to clear the balance. If you need to borrow short term just pay at least the minimum payment.

By clearing the balance each month you can hold the money due to pay the card in your business reserve account and earn interest whilst the credit card is giving you interest free borrowing.

There are often additional perks like air miles which you can use personally. Free personal travel insurance is another useful perk that can save you money personally.

Just be aware of the annual fees connected to business credit cards. If you are not going to benefit from short term borrowing and the added perks then this may not be worth using for your particular business.

Other considerations

- You can have as many business accounts as you wish so if there are two banks with features you like then open two separate accounts.

- If you need to borrow money from the bank you may benefit from a more personal relationship with you business bank. In this scenario a branch based account may be beneficial

- You don’t have to be tied to your bank for all aspects of finance for your company. Pick and choose the most suitable providers for services such as merchant accounts for taking card payment or Factoring services.

Shop around for the best deal and don’t just accept paying fees for use of a business bank account. Remember, treat your business account as if it is your own money and make it work for you!

Small Business Bank Loans – Get Funding For Your Business Idea

Funding your small business can be difficult. That is why so many turn to small business bank loans to help them out. These can be a great way to get your business up and running. But you need to know the ins and outs so that your interest charges don’t overwhelm you and your new business venture.

Planning to own a business is a very crucial since you have to do some planning on what kind of business you want. Owning a small business means you need to have determination and the effort to make it grow. Research is needed, patience, perseverance, guts.

There are several options to find funds for your business; you can borrow some money from your relatives, friends, and etc. for the individual who are just starting to own a small business.

If you have a business and you need an additional capital then many banks offer small business loans. Sometimes extra financing is necessary to propel your business to grow.

Or having a dream to have a business and you need money as capital to start a small business, and then you can have a small business loan from the bank. Some banks offer startup loans for businesses and knowing that borrowing money from the bank has an interest which you need to pay.

So bear in mind that having business is not as easy as what you see and think. You need to estimate the overall expenses every day, your monthly bills aside from your loans, rental of the space for your business. A thorough research is really needed to have a business.

In small business loan in the bank offer lower interest rates than a line of credit commercial loans but when you are just starting your business, more or less bank will grant your loan for your business around 25 to 35% only since the length of your business is not very long yet.

If you want a bigger amount of loan for your business for sure bank will have to ask for collateral in order for them to approve your loan to bigger amount. Although when you have your loan to other financing institution, still they will ask for collateral. Always remember that banks and other financing institution always mean business.

When you go to the bank for a small business loan, you should have your key documents in order to start the solid business plan. Most likely, these are the requirements needed for your loan:

Financial Statements available
Plan or projection for the business
Collateral – such as real estate, bonds or stocks, personal asset, personal guarantees.

Most banks also want to know you are making your own business and most likely approve your business loan if sees that you are investing a good percentage of the necessary startup capital into your business.

Although types of loans processed differ from bank to bank. If you have an existing bank account to one bank, then preferably have your loan from your existing bank. For sure they will be glad to accommodate you for small business loan and since the relationship you have with your bank is good then for sure they will grant you for small business loan.

If you go to other banks, you have to have lots of documents to prepare since most banks, when you loan or any kind of loan; they need some documents as requirements. Traditionally, banks are more conservative with their investment dollars due to the fact that they are investing the money of their depositors so banks should be careful.

Online Small Business Banking

In the digital age every bank has an online presence, from my little credit union to the big national players. However, not all banks are geared toward serving small business via the internet and, while they all offer you a lot of promises and maybe a flashy new toaster oven, not all of them offer you the services that you need at a competitive price. Here’s what to look for and how to spot those that offer online small business banking from the poseurs.

Customer Service and Big vs. Small Banks

One thing that you may read is how important it is to “cultivate relationships” with your banker and how important your banker is in expediting and even deciding whether or not you get a loan. While this may still be true in the smaller banks, in larger regional or national banks you will never, ever meets the person who approves your loan. A buddy of mine who was a big shot at a major bank before ditching it all to go into the Peace Corps said that the big banks create a strong separation from the banker that you meet, who is basically a sales person, and the person who decides, who is basically an accountant. So skip bribing your banker with chocolate truffles or bottles of bourbon. In fact, if you already bought the “gifts,” just send them here and I’ll gladly dispose of them for you for free!

Similarly, once the recommendation for business people was to keep all their banking with one bank, in order to build up a relationship of trust with that bank. Now, however, the idea of relationship is breaking down and, thanks to the internet and the relative ease of online banking, small businesses can cherry pick the best services off a smorgasbord of banks just like the Bigs do. In fact, the biggest reason that I can see of deliberately keeping all services with a single bank is not having to remember more than one sign-on, password, and pin!

What Your Bank Should Be Able to Do for You

Business Checking Account

One of the essential elements of running your own business is treating it as a separate entity distinct from your own personal affairs or the affairs of your other businesses or investments. Failing to treat your business as a separate entity opens up numerous potential legal and tax consequences that could end up being very costly or even financially disastrous to you. Opening up a business banking account is one essential act that helps establish your business as a separate entity. For most business the key to the checking account is functionality, forget interest rates and a few dollars difference in cost. The key questions are:

Can you use the web site to pay pre-pay bills, transfer money, accept online payments and whatever other essential services that your business might need?
Are you able to easily download information from the online site to QuickBooks Online or whatever other accounting software that you might be using?
Do they have the highest level of online security that is convenient for you?
Are they relatively light on “hidden fees” that $5 and $10 you to death just to be able to perform regular, essential operations of your business?

Security

Small businesses run by new entrepreneurs often have lower standards of security and this is especially true when it comes to banking and banking online. The smalls just don’t have the expertise nor the payrolls stuffed with I.T. professionals to keep up with the Trojans and frauds that cyber-criminals use to prey upon the unfortunate, and the unwary. You want the highest level of security possible but without making it so inconvenient on yourself that you aren’t fully able to take advantage of the online services. For example, while I was a Peace Corps Volunteer in Guatemala I often had to do my banking from internet cafes, and not always with my laptop that was impractical to lug around. When Chase, my original bank, changed the security so that I had to go through a complicated and time-consuming process every time I tried to access my account from a different computer I had to change banks (rather, I added a new bank) because that just wasn’t doable for me.

Loans and Lines of Credit

Loans are a prime area of shopping around and using the power of the internet to shave a fraction of a point off the interest rate. However, if you can’t pay the loan through an electronic transaction between the bank of your checking account and the bank that services the loan and make that payment for free then who cares about a little reduction of the interest rate. I like to look around for the best deal and then ask my primary bank if they can match it, just to keep my life as simple as possible.

Credit Cards

One of the easiest ways to make payments these days is by credit card and you will want at least one that is exclusively used for business purposes. There is no “best” credit card for small business and usually your bank will be able to provide you one. Keep in mind that you want one that is easy to set up and maintain electronically, that is widely accepted (especially if you travel for business), and has a high enough limit for what you need. Remember that building up credit for your business is just like building up credit personally, the better your history the higher your limit will be.

In Conclusion

Starting up a small business can be intimidating and the days when you could have a banker hold your hand and guide you through the process are long gone. The flip side of that is the incredible amount of information available to you at your fingertips. Another advantage is that you are no longer geographically limited, a world of banks is waiting to serve you! Just remember to keep in mind the services that you need, those that you don’t need, and those that you need but could be found at another bank for a better price. Happy banking!