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American manufacturers are saying that business is booming, but many of them also say that banks aren’t keen to provide the loans necessary to hire more workers, buy new equipment, and ramp up production. According to Biz2credit, a New York firm that matches borrowers with lenders, a recent analysis found that loan approvals at large banks (those with $10 billion plus in assets) fell in April for the second straight month.
Banks are saying that they’re willing to lend but also admit that they are proceeding with caution, especially with loans to smaller, or contract manufacturers. Recent articles note that “the slow pace of the economic recovery is causing both borrowers and lenders to proceed with caution” and “ the slowdown in small-business lending is due to the March expiration of a temporary 90% guarantee on SBA loans and the reinstatement SBA loan fees that had been temporarily waived to stimulate lending.”
However, I would like to suggest that the continued tightness in business lending may be a reflection of banking strategies employed by different sized banks. Big national banks are much more likely to have been affected by the mortgage backed security mess and the subsequent increase in bank oversight and regulation has encouraged them to reduce risk and tighten lending. Smaller banks, meanwhile, which have traditionally made their living off of smaller loans that they carry on their own balance sheets, seem to have increased their small business lending.
Manufacturing Extension Partnership (MEP) helps local companies succeed in their efforts to develop new products, improve processes, and broaden their presence in the market.
For examples of how MEP centers are making a difference in your state, go to: http://ws680.nist.gov/mepmeis/SearchSS.aspx
It’s that time of year again.
May is World Trade Month, a time to reaffirm the important role that international trade plays in U.S. economic growth.
In today’s global economy, it is more important than ever for American businesses to tap into the abundance of opportunities overseas. 95 percent of the world’s consumers are located outside our borders; helping companies reach them is key to our nation’s economic success and future.
Today more than 80 percent of U.S. exports of consumer and industrial products to Colombia become duty-free as part of the U.S.-Colombia Trade Promotion Agreement. This includes agricultural and construction equipment, building products, aircraft and parts, fertilizers, information technology equipment, medical scientific equipment and wood. Also, more than half of U.S. exports of agricultural commodities to Colombia become duty-free, including wheat, barley, soybeans, high-quality beef, bacon and almost all fruit and vegetable products.
The agreement also provides significant new access to Colombia’s $180 billion services market, supporting increased opportunities for U.S. service providers. For example, Colombia agreed to eliminate measures that prevented firms from hiring U.S. professionals, and to phase-out market restrictions in cable television.
Prior to the enactment of this agreement, the average tariff that U.S. manufactured goods faced entering Colombia was 10.8 percent. With entry into force today, Colombia’s average tariff rate for manufactured goods from the United States has been reduced to 4 percent.
When going on a trip, it doesn’t do much good to review a map if you have no idea where you want to go. You seldom plan a trip without knowing how much time you have to get to your destination and how much money you want to spend to get there. If you are like me, it is also helpful to have a map that shows key locations along the way; the number of miles between certain points; and the type of road you will be traveling on.
The same is true in business. Your record keeping system is the map that tells you how far you are, what key points of interest are currently to be found in your business and helps give you some idea of how far and how long it will take to get where you want to go.
If you’re going to develop an effective map (recordkeeping) system for your business, where do you begin? The best idea is to review those stops along the way that will give you the information you need to make decisions. This is usually done by developing a Chart of Accounts. A Chart of Accounts is no more than a complete listing of all of the accounts; assets, liabilities, equity, revenue and expenses that you have in your business.