US processes over $500 billion in small business loans to stem virus fallout

The US Small Business Administration has processed over 3.8 million loans for more than half a trillion dollars since the launch of the Paycheck Protection Program on April 3 to deal with the economic fallout of the coronavirus outbreak, according to a joint statement by the SBA and the Treasury Department.

SBA has processed about 2.2 million loans, whose value is over $175 billion, since the start of the second round of the PPP loan processing on April 27, the statement added.

The second round of the SBA's Paycheck Protection Program was launched on Monday, allowing lenders to issue forgivable, government-guaranteed loans to small businesses shuttered by the outbreak.

The average loan size in the second round of the PPP loan processing has been $79,000, according to the statement released on Sunday.

The US government's $660 billion small business rescue program has stumbled on missing paperwork, technology failure, and the misdirection of funds to big corporations. It also faces the hurdle of forgiving those hastily arranged loans.

(Reporting by Kanishka Singh in Bengaluru; Editing by Lisa Shumaker)

-reuters-

Vendor Insurance – Why Do You Need It?

Businesses of all types understand the need for various types of events in order to promote products, services or simply information about the brand. Many different types of events – ranging in scope, level of complexity and number of potential attendees – exist, but what doesn’t exist is an event without absolutely any risk. Every event in which a business is exposed also exposes the business to potential risk. Some vendors in particular do not carry full-time liability insurance, but choose to carry vendor insurance for specific events and occasions. What exactly is vendor insurance, and why do you need it? Below, we’ll explain the answers to both questions.

• What is Vendor Insurance? 

Whenever small businesses or sole proprietors have their own events outside of the business or open up shop temporarily in a setting such as a public square or flea market, they are in many cases exposed to liabilities that might not be covered under other insurance policies. Kiosks, food trailers, vendor stands and catering trucks are common examples of this, and in some cases, event insurance may be required by event organizers for each entity present. Any accidents, lawsuits or claims made against one or more of the event’s attendees by another attendee is covered under vendor insurance, ensuring that the business or brand isn’t open to financial liability.
  

• Claims Are Expensive 

Without vendor or event insurance, the costs of a potential liability claim can quickly become expensive. Legal assistance will be necessary – even if the claim is unfounded – and can quickly reach tens of thousands of dollars in some cases. A successful liability verdict against a particular entity could easily be several hundred thousand dollars if true damages occurred to the plaintiff, meaning that the defendant is now on the hook for that sum. Vendor insurance helps absolve liability in these cases and can be purchased as needed from companies such as Best Event Insurance, whether that be for one day, one week or on a recurring basis.

• Litigation Deterrent 

Some individuals are known as “professional claim filers”, who look for opportunities to intimidate sole proprietors and small businesses into settling with them over a grievance for a far smaller sum than what a court case would inevitably cost. Brands and individuals who are covered via vendor insurance can post such notifications at their kiosks or in plain sight, deterring these individuals. Even if such a notice isn’t posted, the coverage is still valid. Many of these individuals – upon learning you have event insurance – will suddenly sing a different tune. Reason? They are looking for ways to easily cash out on supposed grievances: when they learn that they would have to deal with filing a potential claim through an insurance agency (as opposed to settling for cash under the table), their complaints and so-called injuries seem to disappear!

• More Event Opportunities 

Some event organizers simply will not allow you to setup on the premises without some form of vendor insurance. Because event insurance is very affordable, there is often little to no reason not to have this form of coverage. Rather than being limited to a small number of venues and events in which the insurance is not required, individuals and small businesses will suddenly find themselves being able to engage with consumers and passers-by at virtually any event imaginable.

source: 20smoney.com

Many retail industry analysts predict a good holiday season

The chief economist for the International Council of Shopping Centers, a major retail trade group, estimates that sales will rise 3.5% for November and December combined.



As retailers head into the all-important holiday season, they have reason to be optimistic: Months of solid sales are widely expected to carry through to the end of the year, when shoppers are most likely to open their wallets.

Positive holiday performance could have a far-reaching effect. With consumer spending accounting for about 70% of the nation's economic activity, robust sales could breathe life into what has been a sluggish year so far for the broader economy.

Many industry analysts are predicting a good — but not great — holiday season.

The chief economist for the International Council of Shopping Centers, a major retail trade group, estimates that sales will rise 3.5% for November and December combined. Last year, sales during the same period beat expectations, rising 4.4% in what industry analysts called the best holiday results since 2006.

"It's a time when we do the greatest amount of our business, but it is also a season that defines retailers," said Jim Sluzewski, a spokesman at Macy's Inc., which last year saw 28% of its sales in the last two months of the year.

After the recession-plagued 2008 holiday season, the worst in more than four decades, retailers say they've become much more savvy about confronting economic challenges. They're not ordering too much inventory and they're making sure that prices are budget-friendly.

"We are well prepared," Sluzewski said. "Our business is very flexible and we have a lot of ways to adjust our business no matter what happens."

Retailers, which ring up as much 40% of their annual sales during the last two months of the year, also are relying on a tried-and-true rule: Consumers love to splurge when the holidays roll around.

Shopper Deven Ronnquist, 63, was already keeping an eye out for holiday gifts for her family on a trip to the Glendale Galleria recently, setting a loose gift budget of $3,000.

"We have a tradition of spending way too much — we just have a ring of presents around the tree," the La Crescenta administrative assistant said. "I'm going to work hard to pay down some of my credit cards in the meantime."

The start of holiday shopping comes amid skittishness over the volatile stock market, stubbornly high unemployment and tight credit that has constrained business growth. Strong holiday sales could provide much-needed momentum, said Michael Dart, a retail strategist at consulting firm Kurt Salmon.

"If we have a solid holiday season and there's a sense that the consumer is resilient … I think you get more bullish on hiring and it could start to move the employment rate," he said. "It could ease a lot of the anxiety that permeates every business and permeates the consumer psyche right now."

Retail analysts say the key segment to watch will be middle-income consumers. Wealthy Americans have spent freely on luxuries such as designer handbags, jewelry and watches, and lower-income shoppers seeking bargains have led to steady sales increases at discount chains, dollar stores and warehouse clubs.

Analysts say the back-to-school selling season, which often provides a hint of how the holidays will fare, has so far produced solid results. Despite stock market turmoil and Hurricane Irene, sales at major chain stores rose 4.4% year over year in August, the key month of the period, according to Thomson Reuters' tally of 23 retailers.

"We've been seeing consistent spending occurring even in discretionary sectors," said Michael McNamara, vice president of research and analysis at data service MasterCard Advisors SpendingPulse. "This is just a consistent thing that has not correlated with the deterioration in consumer confidence. It's been an interesting phenomenon in 2011."

Retailers are still keeping their biggest plans under wraps, but they have been busy preparing for the holidays all year: ordering merchandise, designing festive window displays and special holiday catalogs, and planning Black Friday promotions.

"Target begins preparing for the holiday season right after Christmas," said Cary Strouse, senior vice president of stores for Target Corp., which recently announced four exclusive designer partnerships that will be in stores in time for the holidays, including a fashion line with Gwen Stefani.

Wal-Mart Stores Inc., the nation's largest retailer, will be adding to its holiday selection this year, including stocking more Christmas villages and outdoor lawn decor. The company said its focus would be on offering the lowest prices to its shoppers.

"We know our customers are feeling budget strains, and we are committed to helping ease that strain," said Tara Raddohl, a Wal-Mart spokeswoman.

Jodi Odell, 46, said she intends to spend big for the holidays even though she has been trimming expenses because business has been slow at the architecture and design firm she and her husband run.

"My husband and I have already talked about it," the Encino resident said recently as she shopped at the Americana at Brand in Glendale. "We plan it out in September. The kids give me their lists early and I will have it all knocked out by November. It's therapeutic when nothing else is going well."

Although Odell won't be cutting back on gifts for her four children, she and her husband, Otis, will only do stockings for each other this year, she said.

Still, she's hoping for a little blue box.

"Tiffany," she said, "fits very well in a stocking."

Source: latimes.com

Recession Busting Tips For Small Businesses

It is a challenging time at the moment for small businesses, staying a float and ready for the New Year with all the additional expenses that Christmas brought from a business and personal perspective mean everyone is looking for ways to economise.

So, now is the time to take a good look and your business and your processes, perhaps there are areas where you could make changes to assist your cash flow.

So take action now to strengthen your business for the year ahead with our 10 recession busting tips:

Count Every Penny

Take a little time to investigate where every penny you are spending is going. It will be more than worthwhile to spend a little time on this as you will find some money you can save.

Re-evaluate your business; closely examine all the expenses you have, look at the things that have become old habits, those that just happen because they always have.

Check if you can streamline any of your processes, if you can purchase any better, if you can cut-out anything unnecessary.

The real surprise is that most businesses can cut costs without customers even noticing and without it affecting their high levels of customer service.

Show Me The Money

Your customers are vital to your business, without them you have no business, but so is the money. Money is critical to your survival, and a steady flow at that, so it is absolutely vital that you get your invoices out on time and that you get paid for the work /products you have supplied.

Good cash flow is critical for your continued survival in this difficult climate and is what will set you apart from the rest.

Very few of us like to chase our customers for payment, but a little time spent now will reap the rewards in the New Year.

Check & Double Check

In a recession it is essential that you get credit checks on all your customers. It is good practice at any time, but it is even more important in a recession.

If you have not been doing this, it is never too late to start and if you have customers who do repeat business with you, get them checked out as well because things can change in their businesses too.

Also get a credit check on your suppliers, you do not want to spend time and money promoting a product that could disappear or have an intermittent supply line.

Try to take as many of the risks of doing business away, to make your position as strong a possible.

Negotiating or Bartering

Don't shy away from asking for a better cost price from your suppliers, even if you have been working with them for many years, don't just assume, you already get the best deal you can, because you may not!

To strengthen your bargaining power try to establish your competitors selling and cost prices if possible, if you cannot get costs at least get the sales price, it will allow you to make some judgements about margin etc ready for your negotiations with your supplier.

Use all your market information to its maximum potential to assist you in reducing your buying price. If you cannot manage to get price reductions across the board on all your products, at least target your most popular selling items and get a reduction on those.

Your Current Financial Status

Always be fully aware of the current financial status of your business and how the next few weeks will impact on it, know the current outgoings and expected income.

Always communicate with your business bank manager. Try to keep in regular contact (this will vary depending on your business and its requirements), keep them informed of your circumstances and if you think you may have difficulties get their help, sooner rather than later.

Always keep to your commitments and do exactly what you say you will do, the bank will look more favourable on you and your situation.

Whatever you do "DO NOT BURY YOUR HEAD IN THE SAND!" This can be fatal.

Your Staff

Use the thoughts and experiences of one of your biggest assets, your staff. Remember they want your business to succeed as much as you do, particularly during a recession.

Ask you staff what they think, what ideas they have, ask for their input. This will make them feel more valued and part of the team and you may be pleasantly surprised about the ideas they come up with.

One or more of them may produce a great idea which may be very successful and make all the difference, if so remember to reward the person. Show your appreciation, get them involved and other great ideas will come in the future.

Be Seen & Get Chosen

It is vital in times of recession that you and your business are very visible to existing clients and potential new customers. In a recession a steady stream of marketing is the lifeblood of your business, this puts you head and shoulders above the competition, be seen and get chosen. Marketing is a vital tool at this time not a luxury, so ensure your profile is out there.

Promote The Good Bits

What is it that sets you apart from your competition, if you do not know what your USP is, then find out quickly and put it in place.

Now you have a USP that sets you apart from the competition, something that your customers like and the reason they choose you. You must now promote your USP like crazy, if some people like 'it' then lots more will also like your product or service, but remember you must keep your promises.

Remember Your Regulars

Your existing customers are very, very important, they are the reason you are still in business, so whatever you do to get new ones, do not loose sight of your existing customers and their value to your business.

Do not take them for granted, or assume they will always be there. Everyone is in the same situation and feeling the recession to a greater or lesser degree, so make them feel special and valued. It does not have to be something big or a grand gesture, just the fact you have remembered them in some small way will be enough to reassure them that they are important and valued by you.

Do not let another supplier step in and take one or more of your regular customers away, make them feel valued, provide good products and services, keep your promises and live up to your USP.

Stay Focused

Staying focused and not panicking are vitally important, you now have a list of things you can do to help yourself and your business enjoy a better year ahead.

Work through the list gradually, some things you may already have done or perhaps have been meaning to do, so this is a timely reminder. You may already be following a similar process, well great, whatever position you are in; you are helping yourself to a better 2010.

Wishing you much success, happiness and health for 2010.

Vanessa Hodge is the owner of Image Connect, a web design, marketing communications and printing company for new start up and small businesses. You can read further articles, hints & tips and more at Image Connect Websites Marketing Printing or Image Connect London Blog.

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