Webinar rewind | Growth Strategies for High Risk Industries – Business Journal Daily
YOUNGSTOWN, Ohio – Acquiring capital to grow can be a challenge for any business owner. But for high-risk industries, it can prove even more difficult as financial institutions may view the business as too risky to support.
High-risk industries include restaurants, bars, hotels, gas stations, daycares, and contractors. Essentially, industries that have “low barriers to entry with limited capital are needed to get started,” said Terry Louk, director of SBA loans at Valley Economic Development Partners.
Louk was joined by General Manager Teresa Miller and Mario Nero Sr., Director of Economic Development Lending, for a webinar on May 20 with Jeff Leo Herrmann, CEO of Youngstown Publishing Co. During the webinar, Louk, Miller and Nero discussed growth strategies for high risk industries.
“There are a number of things businesses can do to overcome the bank’s high risk classification,” Louk said. “They’re going to want to look to have a strong technical assistance or support team.”
This team includes an accountant, a lawyer and professional support. Businesses should also keep their financial data up to date and maintain good business software, such as QuickBooks, that banks can easily relate to, he added.
Nero said it was important for companies in high-risk sectors to be able to show that they are making a profit and not striving to reduce their sources of income.
“When it comes to borrowing money, cash it king,” Nero said. “Cash flow is extremely important. Especially with high risk industries. “
Above all, it’s important to understand your business, Miller said. This includes, keeping your federal Employer Identification Number (EIN) handy, filing articles of incorporation with the state, and ensuring that the name used on tax forms exactly matches the name appearing on the articles of association.
Miller also recommends keeping cash reserves available. While she acknowledges that it’s not always easy to do, it’s important to put some money aside every month.
“Having that stash of money makes you bankable,” she said. “It helps make the deal a little easier to make.”
For more information, watch the webinar posted above.
Copyright 2021 The Business Journal, Youngstown, Ohio.