The Silver Lining for Business Owners

In the previous post, How Credit is Effecting Your Business, we discussed how the credit crises has changed the way that business owners are operating.  We also discussed the value of knowing the true FICO score and where to get it.

Sure there are more things to deal with now than before as a result of the fear that many vendors have. For example only a few short years ago it was not necessary for principals or executives of a business to have to provide their personal credit information when applying for credit or services for their businesses. Today, it is a totally the opposite and many times it is very common for vendors to require a credit check of the company’s executives.

Many landlords have begun to increase the amount of deposit that is required based on the credit scores of the principals.  This is no longer limited to residential property only. Now, commercial property managers are asking to view the credit reports of the company’s owners and/or executives.  In some cases lower credit scores can mean additional deposits in the form of pre-pay rents.

The same is true of utility and phone companies. Depending on the part of the country a business is in, it may mean having to pay for setup fees in advance.
  
The bottom line is that in an era where a lot of vendors have been hurt there exist a lot of fear. We are all experiencing the pendulum swing from easy credit to tight credit. This is not the end of the world, but does require business owners restructure the way they do business and be aware of where the possible snares are and also where opportunities are.

The Silver Lining

Not all is doom and gloom. In fact now is a great time to find what you may need to grow your business. One area where there are now opportunities to get great deals is on previously financed equipment . 

During these tough economic times some companies who had leased equipment have either decided not to continue with the lease and returned the equipment, or are simply defaulting on the lease ,and turning over the equipment.  The result is that many leasing companies are willing to make great deals to get rid of the surplus equipment. 

The other day I was talking with a colleague who bought large copier that was a year old and previously sold for$16,000 for only $2000.   Similarly,  leasing companies do not want previously leased office equipment  back and will make incredible deals not to take it back.

These bargains are not limited to equipment, but also office furniture and even supplies.  One place where these bargains are seen is in bankruptcy trustee sales where the trustee wants to get rid of the inventory as quickly as possible to complete the case.  Here again there is a real possibility to obtain great bargains at pennies on the dollar.

So, for the shrew business owner with cash, during these tough times can mean a great opportunities to get the equipment that will help grow their business.  Alas this to will pass and we all will see a better economy, and these opportunities gone. However, there will be other opportunities at that time if we all just keep an eye out for them.