Maria Coyne
From Maria on Money with Maria Coyne
What are small businesses’ biggest worries these days? A recent survey conducted by the National Federation of Independent Businesses (NFIB) says that slow or declining sales is their most important issue. A full 51% of respondents cited this as their most important worry, trumping uncertainty about the future (22%), access to credit (8%), and falling real estate values (8%). That’s an increase of 6 percentage points from the number of small businesses who cited slumping sales as their number one worry last year.
Access to credit wasn’t a top concern for respondents, and you wouldn’t want it to be. One suggestion I have to ensure that you don’t have difficulty accessing credit is: don’t wait until it’s too late. That is to say, talk to your banker early and often when you see your business starting to slip. Trying for a loan from a bank shouldn’t be your “last resort.” Chances are, at that point, things may have deteriorated so far that you would not have a plausible source of repayment.
The fact is, credit is out there for qualified businesses. For example, Key originated more than $32 billion in loans to consumers and businesses in 2009, including more than $7.5 billion in Q4. The softer demand we’ve seen for business loans from qualified borrowers is reflective of business owners’ uncertainty associated with overall economic conditions. Owners are not seeking credit as they had in the past, until more immediate concerns are resolved.
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