Advantages & Disadvantages of Taking Loans from Banks from Small Business

Every business needs a certain amount of money to start. The entrepreneur on the threshold of starting a new venture, has to work out where and how he will get access to sufficient funds.
The first organization that he thinks of is his bank. Yes banks are almost always one of the first organizations to be approached for funds in the form of a loan. It is here that harsh realities hit the entrepreneur who soon learns how difficult it is to get a bank loan to finance his small business venture. A select fortunate few, do manage to fulfill all the pre-requisites for a bank loan, and are successful in procuring them. But for every successful loan application there are many that get rejected. The tough regulations linked to bank loans are gradually undergoing a change with banks realizing the phenomenal potential of small businesses. This explains the special programs and additional services launched by big banks to woo small businesses.
Bank loans are just one of the various options available for small businesses to raise funds. The final decision about where to secure funds depends on the balance between the pros and cons of the source. Like all other funding sources, bank loans also come with their share of advantages and disadvantages.

Bank Loans for Small Business

Advantages

• Convenient and accessible– Banks are always accessible since they are used regularly for depositing savings or withdrawing them. After being bank customers for years, the bank becomes convenient and familiar, and personalized service makes it the first place to consider for a loan.
• Multiple Loan options– All banks advertise various types of schemes to woo entrepreneurs setting up or running a business. The real earnings for a bank come from the interest they charge on these loans. Options like term loans, standard business loans and others are available for the entrepreneur.
• Non profit sharing– Venture capitalists and angel investors agree to provide a loan in exchange for part ownership, the right to influence decision making and a share of the profits. Banks do not ask for any of these. If they do sanction a loan, they are only interested in getting their interest and partial loan payment installments.
• Lower rates of interest-Though tough to get, banks provide loans at lower rates of interest than other lending agencies and instruments like credit cards.
• Bank loans offer tax benefits– Small businesses taking loans from banks enjoy some relief from tax, since the percentage of profits used to repay the loan is exempted from tax.

It is these advantages that prompt entrepreneurs to approach banks for one of the various loans offered.

Disadvantages

However, as mentioned before, getting a bank loan is not easy, and its disadvantages include:

• Lengthy application process– banks need to verify all the credentials and details about the business before sanctioning a loan. Therefore its application process is very long and its review etc. takes a long time.
• Cumbersome– The prospect of getting into the detailing that banks require is really cumbersome, and from the entrepreneur’s point of view, totally unnecessary.
• Preference given to existing, running businesses– banks prefer running businesses because they can gauge its profitability and credit history before sanctioning the loan.
• Long list of prerequisites to qualify for the loan– banks have long list of conditions that a business should fulfill before they clear the loan. It is sometimes not possible to meet all of them.
• Risk of losing Collateral– bank loans are generally sanctioned against some collateral, often the entrepreneur’s house and property. This stands the risk of being lost to the bank should the business fail to take off.
• Entire amount not granted– banks are known to not agree to grant the whole amount requested for a loan. They may grant 70 or 80 % of the sum applied for. This makes it difficult for the entrepreneur to begin since he has to scout around for the remaining balance and find agencies to funs that before he can start.

Thus it is the balance between these advantages and disadvantages that prompt people to approach banks for small business loans. While raising funds is an essential part of business, so too is budgeting and having someone in the business with a keen eye on keep costs under control and within budget. Anyone in business can reaps the rewards from financial education and professional advice.

Source:  https://www.businessblogshub.com/2010/10/advantages-and-disadvantages-of-taking-small-business-loans-from-banks/

Environment in Business 0.2

It is a surrounding of, and influence on a particular item of interest.It is very important to know that role of environment on our our business or personal life can't be over looked
 Many of us are shaped by the environment we find ourselves because of the influence it has.
Our environment should be able to align with our orientation.
So, it is very important in business arena , environment must be well looked into.
As an entrepreneur, you must be careful in dealing with your environment
It can either build you or break you.

Majority of us are being dragged back by the environment we found ourselves.
So ,it affects the business .Don't forget,It is a surrounding of, and influence on a particular item of interest.Environment has great influence on your business. If you are selling male designer clothes where you have female as dominant residents.You may not make sales.

 If you are operating transportation in an estate where all the occupants have their private cars.

What happen?
No sales.

Environment is a strong pillar an entrepreneur must pay attention to.There are kinds of environment

Physical/ People Environment
Non-People Environment

 In business, watch out for these two environment.

1) Physical/people environment

It is all about those activities , or people who can influence your decision and behavior.
 As I have said, environment is crucial, thus, focus on it.

 If you are not moving with people who can influence your business, you are wasting your time.You are at the wrong end.

So ,you have to define those people who occupy your environment.
Carefully do this because it determines many things.

The people in your life determines how far you can go in life or in business. Don't get it wrong , that does not mean you should become cheap commodity. If you are moving with someone who also does business .You will have smooth relationship and profitable one. If the person is right thinking person.

 2.) Non- people environment

These are majorly  ,information, ideas, belief, books, films ,music etc. that we exposed ourselves to. Some of us are exposed to wrong information,wrong ideas,books et al.

"A good reader is a great leader."

You need to read to boost your potency.

You need to be exposed to helping information. You can't be great than your mindsets
These mindsets are shaped by information, we are exposed to
We need to update and re equipped our arsenals.

Our brains must be refreshed time to time

This is because, being exceptional is good, being a pace setter isn't easy
To be a business mogul ,you need to prepare for it.

Unfortunately, our Nigerian movies have greatly affected our reasoning.

There are a lot of wrong claims portrayed in a right manner. If you are selling or dealing with food, you don't read books out of this environment.

You have to get appropriate tools to excel. You don't read styles and fashion. When own a restaurant or into food business . These are out of environment of this business.
Environment of Business
Finally, as an entrepreneur, you have to realise environment is one of the major pillars in business. If it requires that you CHANGE your environment, please do.

ENVIRONMENT OF BUSINESS

 https://megabrainbizcom.blogspot.com/2018/07/environment-of-business.html 

To start a business, you need to study your environment very well,so as to know the kind of opportunity to be tapped. This observation is very crucial to the growth of the business.many people have failed to carry out this excise ,thus giving them problem in the process of actualising the business'goal. Environment has a prominent role to play so ,it must not be overlooked.

Environment is the surrounding of,and influences on,a particular item of interest. With these underlined words such as surrounding and  influence, one can identify this subject matter as factor that can't be relegated when talking about business.

As an entrepreneur, it is worthy of note, to identify the importance of Environment.
Majority of us do not consider having people in our lives as something to be seriously looked in to. You need to choose with wisdom otherwise, you end up blaming yourself. Environment of business determines how that business can flourish. Environment has influence on the business so the environment must be taking care of.

There are two major environments which an entrepreneur must know.

Idowu Olufemi
CEO, Acolyte Media Expression.

JOKE

Several men are in the changing room of Ikoyi golf club in Lagos. Then a mobile phone on a bench rings and a man engages the hands free speaker-function and began to talk. Everyone else in the room stops to listen.

MAN: "Hello

WOMAN: "Darling, it's me. Are you at the club?"

MAN: "Yes"

WOMAN: "What’s wrong with your voice darling?

MAN: "Nothing really, just tired!

WOMAN: "Ok. I am at the ShopRite shopping mall inside wranglers and found this beautiful Versace leather coat. It's only =N=119,000. Is it OK if I buy it?"

MAN: "Sure,…go ahead if you like it that much.

WOMAN: "I also stopped by the Mercedes dealership and saw the new 2016 model. I saw one I really liked."

MAN: "How much?"

WOMAN: "=N=28,000,000".

MAN: "OK, but for that price I want it with all the options."

WOMAN: "Great! Oh, and one more thing ... The house I wanted last year is back on the market. They're asking =N=178,500,000. Its at Victoria Garden City, the house is so beautiful!

MAN: "Well, then go ahead and give them an offer of =N=178,000,000. They will probably take it. If not, we can go the extra 500 thousand. It really is a pretty good price.

WOMAN: "OK. I'll see you later! I love you so much!!"

MAN: "Bye! I love you, too."

The man hangs up. The other men in the changing room are staring at him in astonishment, mouths agape...

He smiles and asks: "Does anyone know the owner of this phone?"

BMI NOT GOOD INDICATOR OF HEALTH

Researchers from the University of Alberta say the Body Mass  Index, BMI, that measures a person’s body size from their weight and height,  is not only a bad indicator of how healthy you are, it can lead to doctors prescribing wrong treatment. A healthy BMI is typically measured between 18.5 and 24.9. Anything under 18.5 is considered underweight. 

BMIs between 25 and 29.9 fall into overweight territory, and above 30 is considered obese. While someone with a BMI of above 30 is considered obese by the metric, they may actually be perfectly healthy, metabolically speaking. On the other hand, some people with BMIs below 30 have health problems that could improve if they were to lose weight.

BMI tells how big you are, not  how sick you are so it is  not a good criteria to be diagnosing a disease. However, the researchers say what many fail to recognize is that BMI is just a quick and objective number to cite so patients can be told if they have a weight problem. 

Obesity specialists should  use BMI as a first step, and then go beyond BMI as needed. But the doctors admit that BMI still has its place in medicine.

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