Dinn, Hochman & Potter, LLC

Financing an important component in business planning

Money is an important part of doing business. For those Ohio entrepreneurs just getting started, obtaining the funds necessary to begin operation is critical; for those Ohio businesses looking to expand, funding is also needing to make this possible. When it comes to business planning, finances and financing play an important role.

Small Business Administration (SBA) loans are a popular avenue for small businesses just starting out. These loans are a staple of many community banks and offer favorable terms to businesses who do not have a lengthy credit history. This often includes new businesses and entrepreneurs needing to establish a solid history of timely payments. Records indicate that in recent history, almost 50 percent of SBA loan requests were approved.

Larger banks have also begun to show an increasing trend in business loan financing. In fact, almost 30 percent of loan requests from small businesses were approved by these lenders in a recent time period. This increase in funding coupled with increased economic activity paint a bright future for businesses looking to begin or expand operation.

One other source of funding, institutional lenders, have also shown a steady increase in lending activity. These lenders generally include insurance companies, pension funds and other nonbanking lenders. In fact, these sources have shown increased approval rates for small businesses.

Finances play an important role in business planning activities. When the Ohio business has the necessary capital, the chances of success often increase. Experienced legal counsel can assist the business in analyzing the different funding options and determining which one is the most appropriate in meeting business needs.

Source: Forbes, "Four Reasons Why Small Business Lending Is Hot", Rohit Arora, May 11, 2018

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