Small business owners across Chicagoland, and the country, are entering the new decade on a high note, according to the Bank of America Business Advantage Fall 2019 Small Business Owner Snapshot, a semiannual study that explores the perspectives, aspirations and concerns of entrepreneurs around the country.
The survey results indicate that a significant majority of Chicago-area small business owners and entrepreneurs are planning for growth in 2020. In fact, 80 percent say they have plans to expand, and a quarter anticipate hiring additional staff to support their growth. That's great news.
The challenge, however, lies in achieving that growth in a responsible, sustainable manner. Business owners in growth mode may be concerned with how the addition of new team members will impact their payroll costs, how they increase the speed at which they receive payments, or how they can move into a bigger space.
As Chicagoland small business owners look to grow this year -- whether adding a single employee, opening a new location or moving beyond the 'small business' designation entirely -- they should be well acquainted with the resources available to them to manage cash flow and get access to the capital they need when they need it.
Improving cash flow
As a small business grows, the owner's approach to cash flow management must evolve. For example, manual invoice creation and distribution may make sense when a business is small but, as it grows, could become a source of errors or delays. Owners can stimulate their business growth by taking stock of how they manage cash and looking for ways to streamline their systems and processes.
To help with this need, last year Bank of America introduced Business Advantage 360, a digital dashboard designed to make it easier for entrepreneurs to manage the various financial aspects of their business. Available to any Bank of America client with a business deposit account, Business Advantage 360 provides a complete view of business cash flow and access to real-time expertise and guidance -- all in one simple tool.
Accessing capital to expand operations
Accessing capital is a principal concern for most small business owners, impacting their ability to purchase inventory, refinance debt, or bridge the gap between payables and receivables. The key is determining which funding source is right for the business.
Unsecured business lines of credit and business loans are good options for growing businesses. They often feature low fixed rates, flexible repayment terms and may require no collateral -- important for those in the early stages of business ownership. Most importantly, they enable entrepreneurs to fund growth without personal credit cards, a common mistake that places the owner -- and the business -- at risk.
Bank of America is committed to providing access to capital for the more than 30 million small business owners who fuel the nation's jobs and economy. According to the FDIC, Bank of America maintained its position as the nation's top business lender at the end of the third quarter 2019, with $37.6 billion in total outstanding business loans (defined as business loans in original amounts of $1 million and under), up 8.1% year-over-year.
Finding the right support
In today's flexible economy, more individuals are starting businesses than ever before. Oftentimes, the only thing standing between them and their success is the right support. For that reason, Bank of America offers all small business clients access to a dedicated small business advisor. The advisors are available to clients in their local financial center or client's place of business, helping them navigate their ownership experience and connecting them with products, tools and resources they need at every stage of their business.
Small business owners in Chicagoland are optimistic about 2020, and for good reason. With the right tools and support, today's small businesses will become tomorrow's enterprises, supporting Chicagoland's talented workforce and creating an enduring legacy for their founders.
• Mike J. Granata is the small business executive with Bank of America in Chicago. For more information and resources, visit www.bankofamerica.com/smallbusiness/education.