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There is an endless supply of commercial real estate. From gas stations to industrial buildings, to municipal buildings to apartments, to office buildings and even cemeteries and synagogues. There are lot of options for investors looking into commercial real estate, but the question is often: Which type of commercial real estate property is the best to invest in?

The Best Investments

Flex spaces, light industrial complexes and spaces, are always in demand. They are easy to lease, easy to maintain and the tenants typically always take good care of these spaces since they’re designed partially for business and partially for living. Apartment and multifamily properties also carry some of the lowest risks in the industry with the only downside being the high cost of maintenance and management. 

Self Storage units have withstood every economic downturn in history and always manage to stay on top. They are easy to maintain with little maintenance due to the lack of live-in tenants with the only downside being that the industry is incredibly competitive. Self Storage businesses pop up next door to each other, competing for customers by offering the lowest price possible while including highest level of amenities that make sense. On the other hand, mobile park homes have proven to hold almost zero risks as long as everyone owns their own mobile home. There are no buildings or repairs needed. Most of your money will be spent in landscaping and lighting; the renters generally take care of their own area.

Iffy Investments

Single-tenant, single-use buildings (i.e. car dealerships) carry the highest investment risks available. Due to being so specific and expensive, when they’re good (you have a tenant) they’re good, but when they’re bad, they’re awful. This kind of investment is also, oftentimes very hard to sell due to the enormous space and specific layout needs.

What’s In Demand

While flex spaces are always a good investment, multifamily homes — between 2 and 4 units — and co-working spaces are in the most demand. Multifamily homes with under 5 units are often financed just like primary homes and thus come with traditional bank loans and low interest rates as opposed to actual commercial loans which are generally harder to get and come with significantly higher interest rates. With the pandemic and everyone working from home, the need for office space has greatly come into question leading to the rise in demand for co-working spaces. Co-working spaces allow businesses to save on overhead costs while still having a physical location to come to if necessary. These two types of commercial real estate are your best options for immediate returns.

Contact Overhead Capital Ltd. today to get your commercial properties financed successfully.

Although risky, there’s a lot to be gained by acquiring other companies. Outside of the possibility for financial gain, you also gain the opportunity to add new skills, new expertise and new perspective to your business portfolio. Financing a business acquisition can be a little tricky, but here are 10 different ways you can move forward in business acquisition financing.

  1. Cash

It’s very rare that a company has the capital immediately ready to buy a business in cash; however, even if you do, it may not be a good idea to use of the company’s money up front. Business acquisitions are risky and there are other options available that pose much lower risks.

  1. Equity

If you’re merging company’s to create a new identity, company equity is a great way to finance the merge. You’re able to keep your cash, retain the seller’s expertise and boost the morale of staff during the transition.

  1. Earnouts 

If the seller was already considering selling or leaving the company, or even retiring and is flexible on the payment terms, earnouts are a fantastic option for them to continue receiving benefits (revenue) from the company as they are phased out. A percentage would be paid up front with an agreed upon percentage being paid out yearly, for a set number of years, based on the company’s revenue for that year.

  1. Leveraged Buyouts (LBOs)

LBOs revolve around the leverage of the company’s debts in which the buyer leverages the debts against the assets of the business being purchased. The buyer is then responsible for the debt.

  1. Traditional Loan

Traditional loans a very common in business acquisition financing, they typically come with specific acquisition restrictions (e.g., time limits) so shop around and read the terms carefully.

  1. SBA Loans

SBA-backed loans guarantee a portion of the loan to the lender. Because of this they carry low interest rates and are extremely competitive.

  1. Asset-Based Loans

Asset-based loans are financed based on the liquidity of the company’s assets.

  1. Bonds

Issuing bonds is a very complicated process that forces the seller to have a very thorough plan in place in order to pay off the debt. There is an incredible amount of technicality involved in this form of financing, it would be best to consult with a professional.

  1. Joint-Venture

Getting involved with another firm both lowers the purchasing burden and adds additional skills, experience and talent to your new venture.

  1. Third-Party Financing

Although third-party financing companies will likely be interested in investing for equity in the company or they will require collateral, there are a lot of third-party financing options available. 

When looking into business acquisition financing make sure you remember to consider the costs beyond the acquisition. Carefully outline and review your goals to make sure you have enough financing to cover the costs of operations.

For more information on business acquisition financing, contact Overhead Capital Ltd. today.

Managing cash flow for any business can be difficult, but owning a seasonal business often presents unique challenges. If you looking for ways to maintain a healthy cash flow within your seasonal business here are six quick tips to get you on your way.

  1. Assess the Situation

First, figure out if your business is a seasonal one. If you own an ice cream chop in Chicago, IL it’s pretty obvious that your business is seasonal, but if you aren’t sure, track your sales over the past few years and take notes of any consistent drops in sales and business. Is it always around a certain time of the year or do sales drop when the weather is bad? Does your business rely on tourism?

  1. Create a Plan and Budget

Looking at your sales and operating costs from previous years, create a cash flow forecast—can be done with accounting software—and project your sales over the next 12 months. Create a budget that creates space for where operating costs are higher than sales. During your busy season save your surplus to accommodate the slow seasons.

  1. Get Paid Faster

A good and efficient invoicing season goes a long way. Invoice customers and clients immediately. Make sure they are accurate and that your payment terms are clear. Make making payments as easy and quick as possible by including a link in digital invoices where they can check out immediately and accept multiple forms of payment. When payments become overdue, reach out to resolve the balance immediately.

Effective invoicing allows you to take on more clients and customers during your peak seasons and keep you cost efficient during your slow season.

  1. Increase Income

There are two approaches to generating more income: create new products and services or increase the value (and price) of the products and services that you already have. You can do both. During peak seasons you can tailor services to customers in order to create unique one-of-a-kind experiences and during slow seasons you can teach lessons or sell corresponding and complimentary merchandise. Increasing your business’ revenue will mean thinking of your business as a year long experience

  1. Cut Costs

It’s a good practice to go over your expenses quarterly, at the very least. Hidden costs and fees always find a way to creep into budgets interrupt cash flow. Delete subscriptions that you don’t need, find more efficient vendors and look for ways to save money any way you can. Consider closing temporarily during your slow season to save on operating costs. 

  1. Look into Financing

Lastly, look into opening a business line of credit to assist with your cash flow. Similar to a credit card, a line of credit provides you with access to a certain amount of money that you can borrow from and repay over time. Lines of credit are incredibly flexible, allowing you to receive cash that is able to be used as your business requires.

Taking the time to acknowledge, budget and plan for the slow seasons in your business will help you grow a financially stable and successful business for years to come.

Unless you are abundantly wealthy it is almost certain that business funding will be a key necessity for your enterprise. It is important to know that the lack of capital and cash flow problems are among the key reasons for business failures.

The Reasons That Business Funding is Needed

Business funding can be needed for many reasons including purchasing equipment or other fixed assets, buying more inventory, securing a business opportunity, getting more talent for the business, improving or expanding your physical location, restructuring debt, or securing more working capital.

10 Different Ways to Finance Your Business

Securing business funding must match the needs of the business. Here are 10 ways to get the funding that you need:

The most common way is to get a traditional term loan from a bank or credit union.
The Small Business Administration (SBA) offers loans specifically tailored to the needs and conditions of small businesses, including favorable interest rates and terms of repayment.
Venture capital money can be provided to organizations that have a promising business future and manageable risk.
Angel investors are those groups or individuals who place their own funds into enterprises with promise.
Alternative lenders are specialists who provide funding such as accounts receivable financing, factoring, and merchant credit card financing.
Friends and family. This approach is often used but it comes with relationship risks.
This approach is a creation of the internet economy. It involves posting your business idea and plan on a forum to seek interested investors.
Incubators are organizations that want to find the next business breakthrough.
Applying for federal grants is a way to get funding for companies that are focused on research and development programs.
Bootstrapping is the means of pursuing every personal avenue to get business funding.

Seek Expert Financial Assistance

Contact Overhead Capital Ltd. based in Lebanon, OH, for financial solutions to address your startup and ongoing capital needs. Our experienced financial professionals can help you secure funding to meet your business’s financial needs and goals.

If you are an investor in the real estate industry, you might be wondering how you can finance any type of commercial property. A CMBS loan, also called a Conduit loan, is among the best options you have to achieve such financing. Although this type of real estate funding has been around for a while, most investors in the industry do not understand what they are and how they function. If you are among such individuals, then read through this article to find out what CMBS loans are.

Definition of CMBS Loans

CMBS stands for Commercial Mortgage-Backed Securities. This type of commercial real estate loan is secured by the first position mortgage of the property or properties in question. These loans make it easier for investors to access investment banks, commercial banks, syndicates of banks, and conduit lenders. Borrowers prefer these kinds of funding because, besides the minimal risk, their fixed rates are also lower than those of traditional mortgage loans.

Who Needs CMBS Conduit Loans?

This type of financing is ideal for any company or individual who has their eyes fixed on investing in commercial real estate. CMBS conduit loans are only helpful to income-generating properties, such as office spaces, hotels, storage facilities, industrial properties, retail constructions, and multifamily properties.

How These Loans Work

The best thing about CMBS loans is that they are accessible even to new commercial real estate investors. They do not have so much scrutiny and restrictions, unlike traditional mortgage loans. The number of CMBS conduit loan lenders has gone up drastically, thanks to the ease with which investors can acquire these loans. As an investor who wants to realize a substantial return on investment, CMBS loans are your best shot because they have lower fixed rates.

Underwriting Parameters for CMBS Loans

The leniency you get with these kinds of loans is very high compared to the one for traditional mortgage loans. You can get a CMBS loan even if you do not meet the typical demands stipulated by a local savings bank. The two CMBS loans underwriting criteria are the loan to value ratio (LTVR) and the debt service coverage ratio (DSCR).

Getting funding for your commercial real estate business can be tricky. However, CMBS loans have become a game-changer in that sector. Contact experts today to get more information on these loans and any other pressing financial help you may need.

Consolidation loans are a great method to deal with any consumer debts you may have. However, although it may seem like a perfect way out of a challenging financial position, you should be well-informed about the drawbacks associated with these loans. The information discussed below will give you profound knowledge on the pitfalls of debt consolidation and how best to avoid them.

Have a Loan Repayment Plan

Many borrowers overlook during their financial desperation moments that the loans they get to consolidate their debts must be paid back to the lender. As long as they get the money to consolidate the debts, they do not mind getting the resources or coming up with a plan on how they are going to pay back the loan. It is recommendable to include loan repayment in your budget.

Know the Types of Debt Consolidation Loans

Generally, getting a consolidation loan allows you to offset debts that have pressing deadlines. However, you should understand that there are different types of these loans, and each has its own terms and conditions. They include:

Fixed loans – the interest rate does not change, although it might be higher.
Variable loans – the initial interest rate changes with the real-time market rates.
Secured loans – a valuable asset that acts as collateral.
Unsecured loans – no collateral is involved.

Understand the ‘Terms within the Terms’

The process of acquiring a debt consolidation loan may seem simple, but you must be on the lookout for all the terms before committing yourself. Going through each clause keenly and intensely will help you identify any hidden charges or variances in interest rates.

Know How Interest Rate Relates to the Cost of the Loan

Your lender may use extended loan repayment periods to lure you into getting a loan from them. However, you must understand that the total cost of the loan is calculated based on the money you borrow alone – you must also include the interest rate. An increase in the loan repayment period may mean an increase in the interest rate, consequently increasing the overall loan’s cost.

Debt consolidation loans are good because they come in handy in an emergency. However, you must remain vigilant of the pitfalls, some of which are discussed above. Talk to professionals today to acquire more details about these kinds of loans and other financial services.

It can be difficult to achieve business productivity at times. This is something most struggle with sooner or later. The good news is that there are some tips you can follow to make working more efficiently easier. 

Keep Your Work Space Neat

Avoidable distractions are the number one thing that can destroy your ability to be productive. You can counteract this by streamlining your workspace. Eliminating clutter before you start your day will automatically help you operate more efficiently. When everything you need is easy to access, your workday will go much smoother than it would otherwise. 

Make Your Work Space Inspiring

Something as simple as having certain colors in your workspace will automatically increase your business productivity.  Calm colors like blue will soothe you and relax your mind so that it can accommodate the thought processes you need in order to do your job successfully. Another way to make your workspace inspiring is to add some live plants to it. When you feel connected to the outside world you’ll be more likely to be productive throughout the day. Studies have shown that individuals without office windows, that decorate their workspace with plants, experience less stress during working hours. 

However, color and live plants aren’t the only way to make your workspace more inspiring. Having some personal touches, like photos of loved ones, can make a significant difference in the quality of the work you produce. You should also include something that has helped contribute to your career success, like a certification or diploma. 

Tackle Undesirable Tasks First

One common reason for business productivity to suffer is that individuals put off completing tasks they don’t enjoy doing. When you get these tasks over with first, it helps inspire you to push through the rest of your workday. The remainder of the tasks you have to complete will bring you relief, knowing the undesirable tasks are already taken care of for the day.

You should always prioritize tasks so that the most important ones are completed before anything else. 

For more tips on how to increase and maintain business productivity, please contact Overhead Capital Ltd.

You need to find the right business supplier for your company to deliver quality goods and services to your customers. Discussed below are some key steps in ensuring you choose the right supplier.

Set Your Criteria

You can make a list of criteria your supplier has to meet when making deliveries. Some things you should consider include:

Minimum and maximum quantity to be delivered
Ideal lead time is the time you wait between placing an order and receiving it.
Terms and conditions of payment
Communication standards are how the supplier communicates and responds to your concerns.

This will help you evaluate potential suppliers and see who can meet your needs.

Browse Your Options

When you know what product you want, start exploring your options from different suppliers. Start evaluating potential suppliers by looking into their reputation. What are other business owners saying about them? Are they satisfied with the services they are getting? The next thing you have to consider is your business type. That will determine whether you will need a wholesale supplier or a private label manufacturer. Also, check whether the suppliers protect their business by offering fraud protection and insurance.

Call for Bids

The next step in choosing a business supplier is calling for bids. Suppose you are filling out a Request for Quotation or a Request for Proposal, including details like the quality standards, quantities, and delivery dates. During this process, ask vendors questions like sourcing and planning the raw material to filter out any unreliable or shady suppliers.

Evaluate Submitted Bids

Evaluate the bids from each supplier and see who can meet your quality standards and budget needs. Pricing is also significant. You want a supplier that is fair so that they do not cut into your profit margin. Once you have settled on a supplier, do a double check by requesting a sample of the product to see the quality.

Monitor Supplier Performance

Keep tabs on the vendor to see how they perform. You will need a reliable supplier who meets their commitment and delivers according to your agreement.

It is essential to choose a reliable supplier as they can either break or make your business prosper. Therefore, ensure you are working with a legitimate vendor. Once you have found the right supplier and you are short on funds, reach out to Overhead Capital Ltd to help you with funding.

You need to find the right business supplier for your company to deliver quality goods and services to your customers. Discussed below are some key steps in ensuring you choose the right supplier.

Set Your Criteria

You can make a list of criteria your supplier has to meet when making deliveries. Some things you should consider include:

Minimum and maximum quantity to be delivered
Ideal lead time is the time you wait between placing an order and receiving it.
Terms and conditions of payment
Communication standards are how the supplier communicates and responds to your concerns.

This will help you evaluate potential suppliers and see who can meet your needs.

Browse Your Options

When you know what product you want, start exploring your options from different suppliers. Start evaluating potential suppliers by looking into their reputation. What are other business owners saying about them? Are they satisfied with the services they are getting? The next thing you have to consider is your business type. That will determine whether you will need a wholesale supplier or a private label manufacturer. Also, check whether the suppliers protect their business by offering fraud protection and insurance.

Call for Bids

The next step in choosing a business supplier is calling for bids. Suppose you are filling out a Request for Quotation or a Request for Proposal, including details like the quality standards, quantities, and delivery dates. During this process, ask vendors questions like sourcing and planning the raw material to filter out any unreliable or shady suppliers.

Evaluate Submitted Bids

Evaluate the bids from each supplier and see who can meet your quality standards and budget needs. Pricing is also significant. You want a supplier that is fair so that they do not cut into your profit margin. Once you have settled on a supplier, do a double check by requesting a sample of the product to see the quality.

Monitor Supplier Performance

Keep tabs on the vendor to see how they perform. You will need a reliable supplier who meets their commitment and delivers according to your agreement.

It is essential to choose a reliable supplier as they can either break or make your business prosper. Therefore, ensure you are working with a legitimate vendor. Once you have found the right supplier and you are short on funds, reach out to Overhead Capital Ltd to help you with funding.

Accounts receivable financing is is a form of alternative financing that you may wish to consider when your business needs an infusion of working capital. Also known as AR financing, your funds generally arrive quickly and conveniently so that you can help meet the short-term needs of your business operations. Like all financing options, account receivable financing has both pros and cons. Here are some of the particulars.

AR Financing In a Nutshell

Account Receivable financing can be summarized as follows:

You apply for funding for one or more of your businesses that has accounts receivable.
The financing company reviews the value of your outstanding invoices and other particulars of your business.
Once approved, the financing company sends you the working capital as a lump sum.
You can use the money as you see fit: for debt reduction, expansion, new business lines, inventory, etc.
You repay the financing agent incrementally until the lump sum is repaid in full. 

The amount you can obtain depends on the financing company. In some cases, your funding is capped at 70% of the value of your receivables. On the other hand, a different agent may permit you to obtain up to 100% of your receivables. Also, different lenders can impose different levels of funding, such as from $50,000 to $1 million or more. 

With this type of financing, your outstanding invoices are under your control: It is still your responsibility to collect payments as those invoices come due. That’s different from a similar type of financing known as accounts receivable factoring. 

Summary

AR financing is worth considering if you’re interested in getting working capital for your business fast and you don’t have perfect credit. It is important to weigh the benefits of AR financing against the total cost of financing to decide if it’s a good option for your particular business situation. Give us a call at Overhead Capital Ltd. and we can help you navigate the process.

Opening a salon can look like a less-demanding business option until you are left to plan and execute everything singlehandedly. Having a reliable guide you can follow is always an important step to consider. 

Here is the ultimate stepwise guide to opening a salon that every aspiring business person should consider. 

1. Write the Business Plan

Any successful business arises from a well-written business plan, thus writing a business plan becomes the first most crucial step of starting your salon business. Include a customer’s segment, your acquisition channels, appropriate business relationships, supplier plan, cost structure, key resources, and revenue streams. 

2. Come up with the Cost Estimates

After establishing the plan, the next step is determining how much money you need to actualize your plans. This is the phase where you consider financing options, including going for startup loans to supplement the cash you have at hand. Create realistic plans that will see your business rise from the low without incurring too much debt.

3. Ensure Your Salon Business

One major legal requirement you’re going to have to comply with is insuring your business. While insuring your salon may seem like a painful step at the start, it is a crucial step you cannot afford to jump. Insurance will present itself in various forms, including covering your employees, yourself, your business space, and your clients, among others. 

4. Pick a Suitable Location and Bring in Your Staff

Choosing a location is reminiscent of setting yourself up for either success or failure. An ideal location where there’s much foot traffic will be a hotspot for your salon business. Likewise, if you choose a location with minimal traffic, you will likely have a slow business. Once you have the location and everything is set, it is the ideal time to bring in your staff to receive any clients.

5. Market Your Salon

Whether you are at a central location full of clients or in the interior where clients can’t access easily, your marketing endeavors can make the difference. You need to invest in digital marketing options to optimize your marketing campaigns and reach as many customers as you can.

Are You Ready for Your Salon Business?

One of the ways of getting ready for your salon business is securing your finances in time. Financial organizations like Overhead Capital Ltd can help you secure a small business loan for your salon. Make your financial move today and secure a safe start for your salon.

There is an endless supply of commercial real estate. From gas stations to industrial buildings, to municipal buildings to apartments, to office buildings and even cemeteries and synagogues. There are lot of options for investors looking into commercial real estate,...
Continue Reading →
Although risky, there’s a lot to be gained by acquiring other companies. Outside of the possibility for financial gain, you also gain the opportunity to add new skills, new expertise and new perspective to your business portfolio. Financing a business...
Continue Reading →
Managing cash flow for any business can be difficult, but owning a seasonal business often presents unique challenges. If you looking for ways to maintain a healthy cash flow within your seasonal business here are six quick tips to get...
Continue Reading →
Unless you are abundantly wealthy it is almost certain that business funding will be a key necessity for your enterprise. It is important to know that the lack of capital and cash flow problems are among the key reasons for...
Continue Reading →
If you are an investor in the real estate industry, you might be wondering how you can finance any type of commercial property. A CMBS loan, also called a Conduit loan, is among the best options you have to achieve...
Continue Reading →
Consolidation loans are a great method to deal with any consumer debts you may have. However, although it may seem like a perfect way out of a challenging financial position, you should be well-informed about the drawbacks associated with these...
Continue Reading →
It can be difficult to achieve business productivity at times. This is something most struggle with sooner or later. The good news is that there are some tips you can follow to make working more efficiently easier.  Keep Your Work...
Continue Reading →
You need to find the right business supplier for your company to deliver quality goods and services to your customers. Discussed below are some key steps in ensuring you choose the right supplier. Set Your Criteria You can make a...
Continue Reading →
Accounts receivable financing is is a form of alternative financing that you may wish to consider when your business needs an infusion of working capital. Also known as AR financing, your funds generally arrive quickly and conveniently so that you can help meet...
Continue Reading →
Opening a salon can look like a less-demanding business option until you are left to plan and execute everything singlehandedly. Having a reliable guide you can follow is always an important step to consider.  Here is the ultimate stepwise guide...
Continue Reading →