Business Financing

photo credit: norhendraruslan

Last week I conducted an exploratory marketing session with a new business owner. One of the topics that came up was how tough the credit crunch has made it for businesses to get financing. And that got me thinking…

For several years I’ve championed the concept of growth through leveraging marketing assets. Assets that already exist within companies. This approach frees the business owner from worries that come from having to ‘beg’ a banker for money. And there’s no need to give up a portion of your company to venture capitalists either.

If you have an existing business, the easiest way to increase your operating capital isn’t to go get more loans. Business finance should be your last option. Most people balk at this thought. This is a mindset problem. I know. I worked in banking for ten years. The idea of leveraging marketing assets never occurs to business people. They have been conditioned to think the money must come from someone else.

Yes, and that’s the way bankers and finance companies want you to think. Imagine if every business on earth suddenly turned their focus to internal growth through improved marketing. The bankers and business financiers would go crazy. They’d call you a fool. To them, the one source of ’sure money’ is them.

Lets be honest. If they didn’t take this approach they’d be out of a job. Fewer businesses would borrow money. So they use propaganda to convince the entire nation that the ‘normal’ way of growing is to go into debt. This is a win/lose proposition.

Sure, if you’re just starting out and have zero operating capital and have no relationships of any kind with vendors, clients, peers, or others…the idea of financing your dream may seem like the only way to go. Financing isn’t the first option. Especially for established businesses.

A better option is to leverage marketing concepts that don’t cost money. Or that cost very little money.

One of the ideas I gave to the business owner I spoke of earlier, is to leverage relationships with other business owners and decision makers. These are people who are in a position to generate immediate referral sales or direct sales for his company.

Leveraging relationships is just one way to increase capital. There are hundreds of other ways to increase sales and cash flow through marketing leverage. Few of which are affected by the credit crunch. A side benefit to leveraging marketing assets is it frees you from feeling like some second rate citizen begging for money.

So if you’re thinking of borrowing business capital, put the idea on the back burner for now. Instead, take a look and determine if your company can immediately leverage its marketing assets for increased capital without borrowing. It’s more of a sure bet than hoping to get money from a banker. And a whole lot less stressful.

That’s advice coming from a former banker.

Go to Andre’s informational small business marketing site for more tips and resources for increasing sales revenues, profits, and capital without borrowing.