Kinh doanh marketing - Chapter 7: How to obtain the right financing for your business

Chapter 7How to Obtain the Right Financing for Your Business Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin7-1How To Obtain The Right Financing For Your BusinessImportance Of Proper FinancingEstimating NeedsDebt Vs. Equity StructureTypes/Sources Of Equity & DebtWhat Lender Looks For7 - 27-2McGraw-Hill/IrwinCapital RequirementsFixed AssetsWorking Capital Current AssetsCurrent Liabilities Working CapitalPhotoLink/Getty ImagesTypes Of FinancingDebt- Lender’s Income Does Not Vary With Business SuccessEquity- Stockholder’s Income Does Vary With Business SuccessPhotoLink/Getty ImagesCash BudgetsProject Working Capital NeedsReflects WhenRevenue CollectedExpenses PaidConsiders Seasonal Revenue FluctuationsUsed For Obtaining Working Capital (Line Of Credit) LoansEquity FinancingOwner’s Claim Share Of Firm’s AssetsProprietorship/Partnership Equals Owner’s Personal AssetsCorporation = Stock, 1 Share = 1 VoteCommonPreferredInvestment Liquidity Depends On MarketPhotoLink/Getty ImagesCommon StockholdersReal Owners Of CorporationFinancial Claim Is After All OthersRight To VoteControl ManagementRoyalty-Free/CORBISSmall BusinessShare Of StockPreferred StockholdersClaim To ProfitsBefore Common Stock DividendsNot Legally EnforceableNo Voting RightsFixed Par Value & DividendCumulative DividendSmall CompanyOffering Registration (SCOR)Raise Up To $1 Million TradedAMEXNASDAQ- OTCRyan McVay/Getty ImagesSources ofEquity FinancingSelfSmall Business Investment Companies (SBICs)Venture CapitalistsAngel CapitalistsOtherBusiness IncubatorsEmployee Stock Ownership Plans (ESOPs)CustomersPhotoLink/Getty ImagesBarteringCompanies Swapping Items Of Equal ValueUsesBusiness TravelDebt CollectionClosing A SaleEmployee Perks/BonusesLine Of CreditSubject To TaxArtville/Getty ImagesAccountingFor Bartering Items Dissimilar- Gain vs. LossItems Alike- Use Book Value Of Old ItemJanis Christie/Getty ImagesDebt FinancingComes From LendersMust Be RepaidAt Specified Interest RateWithin Agreed-Upon Time SpanLegal Claim On Assets Before StockholdersEquity = Safety Net For LendersRyan McVay/Getty ImagesDebt Financing Advantages Cost Of Debt Lower Than EquityInterest Payments DeductibleDebt Funding Allows For More Capital To Be Raised In Addition To EquitySince Debt Payment Is Fixed It Allows Owner To Keep Remaining ProfitsLeverageRoyalty-Free/CORBISDebt SecuritiesBondPublicly IssuedLarge CompaniesLoanCommercial BanksInsurance CompaniesFinance CompaniesRoyalty-Free/CORBISSecurities’ MaturitiesShort-Term- Less Than 1 YearIntermediate- 1 To 5 YearsLong-Term- 5 Years+Royalty-Free/CORBISBondsStandard DenominationMethod Of Interest PaymentMethod Of Principal PaymentRoyalty-Free/CORBISTypes Of LoansMortgage- Secured By Real EstateChattel Mortgage- Collateral Other Than Land, e.g., Machinery, Vehicles, InventoryAsset-Based- Secured By AR & InventoryUnsecured- Personal GuaranteesRoyalty-Free/CORBISSources Of Debt FinancingTrade CreditCommercial/Other Financial Institutions- Line Of CreditCredit CardsInsurance CompaniesRyan McVay/Getty ImagesSuppliers OfSmall Firm CreditTraditional SourcesOf Small Firm CreditSource: Small Business Administration, SourcesOf Small Firm CreditSource: Small Business Administration, Business AdministrationGuaranteed Loans- 7(a) = 30 to 40% Of Long-Term LoansPurchase Land, Buildings, EquipmentWorking CapitalRefinance Existing DebtSeasonal Lines Of CreditSpecialized ProgramsSBICsU.S. Department Of AgricultureRyan McVay/Getty ImagesSBARequired DocumentsNarrative Business PlanResumesLoan RequestHow To Be UsedList Of AssetsFinancial Statement- 3 YearsFirm’sPersonalCollateralRoyalty-Free/CORBISLenders Want To KnowStartupCan You Live Without Income From Business?Loan Repayment?Collateral?ExistingTrack RecordFuture Difference?