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Small Business Finance Communications

Updated on January 28, 2016
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Stephen Bush is the founder and CEO of AEX Commercial Financing Group. Steve obtained his MBA from UCLA and is a U.S. Navy veteran.

The Intersection of Business, Finance and Communication
The Intersection of Business, Finance and Communication

Help for Improving Small Business Finance Communications

Many small business owners probably want and need help that will improve their financial communications and negotiations with commercial lenders as well as other businesses.

Very few small businesses are already spending enough time on business communications. Regardless of what the specific functional need is, practical improvements can contribute quickly and positively to the financial health of a small business.

Business Communications Questions
Business Communications Questions

Where to Start?

Evaluating Options and Choices

There will probably be an initial realization that specialized business finance communications help is required to either find or solve a specific financial problem. A good place to start with any problem is to undertake a candid assessment of the overall situation and then to prioritize the actions needed.

The process of dealing with commercial lenders has become much more difficult during the past several years. To make matters worse, one of the most disliked activities for small business owners is communicating with their commercial lender. In such situations, small businesses should actively consider seeking help for both routine communications as well as more complicated business lender negotiations.

When commercial borrowers are evaluating how to solve their current financial problems, the possibility that they might benefit from specialized small business finance communications help rarely jumps to the top of their action list. The failure of small business owners to devote sufficient attention to areas such as commercial lender negotiations and business bank communications almost always ends up being a critical mistake that is realized and regretted later.

Identifying new solutions for business finance problems has become both a practical and necessary way to cope with an increasingly difficult financial environment for small businesses. In some cases this involves replacing a bad bank with a good bank. Another common scenario includes business lender negotiations to improve financing terms or to initiate a new lending relationship. In most cases, the use of better small business finance communications can often have an immediate positive impact on overall business results.

Cost Benefit Analysis
Cost Benefit Analysis

Practical Business Solutions

Problem-finding and Problem-solving

Very few small business owners can survive without at least some regular amount of commercial financing. For a borrower seeking any amount of financial help to keep their business afloat, this critical need must be treated as a high priority action item in order to ensure the financial health and survival of the business. With a focus on doing what is absolutely necessary for a business to survive, it will become clear that improved commercial lender communications can play a critical role in getting the job done. Increased attention to this and other aspects of small business communications can quickly make a difference.

The harsh financial conditions currently faced by most small businesses are sufficiently difficult that business owners simply cannot afford to overlook any possible solution. Nevertheless, that is exactly what is happening when a commercial borrower fails to thoroughly consider all of their business finance choices. Utilizing prudent management options such as business lender communications and commercial lender negotiating will provide a solid foundation for finding practical business solutions.

9 Mistakes to Avoid with Press Releases

The Special Value of Press Releases

Writing an effective press release requires a combination of specialized skills. I published a Hub devoted to the "art and science" of press releases. By learning how to do a better job of press release writing, business owners and managers can also improve other areas of business writing.

Commercial Bank Analysis
Commercial Bank Analysis

Commercial Bank Analysis

Good Banks and Bad Banks

Any comprehensive analysis of small business finance communications problems and solutions must necessarily place a great deal of emphasis on commercial banking and other lending relationships. Bank failures are at a historically high level, and even more banks are defined as having serious operating deficiencies by the Federal Deposit Insurance Corporation. Banks are simply not making commercial mortgages and small business loans at a rate that will sustain normal working capital needs for small businesses.

Faced with inadequate help from their bank, small business owners will eventually reach the point where they ask themselves: Should I fire my banker? Evaluating which banks are "bad banks" is increasingly vital to the future financial health of most businesses. When your business continues to be unsuccessful in obtaining sufficient working capital and other business financing from your current bank, firing your banker has become a more necessary and practical part of any prudent solution to a critical problem for many commercial borrowers. By the way, the Federal Deposit Insurance Corporation could fire your banker for you (if you don't do it first) since there continue to be literally hundreds of "problem banks" on the monitoring list for the FDIC.

In a friendlier banking climate than the one now facing all of us, such concerns might not be at a critical level. But the financial chaos that began impacting banks several years ago has probably changed the face of commercial lending forever.

Asking the Right Questions Is Critical

Power Questions: Build Relationships, Win New Business, and Influence Others
Power Questions: Build Relationships, Win New Business, and Influence Others

I have talked often about the vital importance of asking the right questions. There is both skill and knowledge involved in doing this, and here is an essential book to make the whole process much easier.

Some Key Business Communication Questions and Answers

Should I fire my banker?

This should not be the starting point in finding an effective business financing solution, but it is a good idea to realize at an early point that this might ultimately be the most prudent option in order for a business to move forward. Small businesses should preferably explore all appropriate actions (including commercial lender communications, business bank consulting analysis and business lender negotiating) prior to executing a decision that includes firing their banker.

If business finance communications is so important, why do many small business owners overlook it altogether?

Here are a few possible explanations:

 
Small Business Financing Questions
Small Business Financing Questions
  1. Many commercial borrowers do not readily perceive the far-reaching impact and importance of commercial finance communications. Hopefully discussions like this one will open a door here and there to increased understanding of the avoidable risks and problems.
  2. Even when the importance of business finance communications is realized, many small business owners frequently feel that they have too many high-priority activities competing simultaneously for their attention. When this happens, one or more important tasks can end up unfinished (or not even attempted). More often than not, business communications ends up in the "to do" pile and stays there as other vital business needs come into the picture.
  3. The commercial lending environment has gone from bad to worse since about 2006. There is a general perception that small business financing is becoming less and less available. In the prevailing atmosphere of confusion and uncertainty about the actual availability of commercial loans, it is only natural that many small businesses would adopt a "wait and see" attitude. As a result, related activities like business finance communications will also be placed in a holding pattern.

Failure to Communicate
Failure to Communicate

The most important thing in communication is to hear what isn't being said.

— Peter Drucker

The Best of Peter Drucker

The Essential Drucker: The Best of Sixty Years of Peter Drucker's Essential Writings on Management (Collins Business Essentials)
The Essential Drucker: The Best of Sixty Years of Peter Drucker's Essential Writings on Management (Collins Business Essentials)

In a related observation about communication, Peter Drucker also said:

"The single biggest problem in communication is the illusion that it has taken place."

Here are selections chosen by Peter Drucker to represent his best work.

Peter Drucker is often referred to as "The Man Who Invented Management."

Business finance communication is not a stand-alone strategy, and collaboration is one of the key pieces often missing in attempts to solve difficult problems. This unique and practical book will be helpful on multiple levels.

As suggested in the Peter Drucker observation noted both above and below, it is almost always critical "to hear what isn't being said." A living and breathing example where this perspective must be applied daily by small business owners is whenever dealing with banks in the current chaotic financial environment. On behalf of my clients, I am constantly asking:

What isn't being said about banks?

 
Communication
Communication

A Poll - What Do You Think?

Is business communications an overlooked area when small business owners try to resolve their commercial finance problems? Should individuals devote more time to improving their communications with others?

Agree or disagree? Individuals and business owners should spend more time communicating and improving communications with banks, other lenders, suppliers, colleagues and customers?

See results

Business proposal writing and negotiating are both key elements in effective business finance communications.

Shut Up and Say Something: Business Communication Strategies to Overcome Challenges and Influence Listeners
Shut Up and Say Something: Business Communication Strategies to Overcome Challenges and Influence Listeners

This comes with my highest possible recommendation. It is a superb combination of practical business communication strategies and illustrations of just how important business communications continues to be for any small business owner.

What If They Won't Listen?

If you want to negotiate with your bank, do you know who you need to communicate with to get better terms? How about the same question but with regard to utilities and suppliers?

What if the individual you want to talk to doesn't want to talk to you? Or what do you do if the person you are talking to keeps saying no when you want the answer to be yes?

These questions illustrate why communication is so hard to do effectively. Two of the most effective forms of business communication that will help: negotiating and writing.

 

You ought to be able to explain why you’re taking the job you’re taking, why you’re making the investment you’re making, or whatever it may be. And if it can’t stand applying pencil to paper, you’d better think it through some more. And if you can’t write an intelligent answer to those questions, don’t do it.

— Warren Buffett
Thanks for Visiting Small Business Finance Communications — All images provided under End User License Agreement to Stephen Bush
Thanks for Visiting Small Business Finance Communications — All images provided under End User License Agreement to Stephen Bush

© 2011 Stephen Bush

And now, your thoughts on the subject...

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      anonymous 5 years ago

      Yep, communication is the main aspect, it can improve things, it can also help reviving things from dead ends, getting financial help etc.

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      autorespondernewsbrief 5 years ago

      Ah yes, financing for business. Can be a major headache when funds dry up and you need to source finance to continue trading.