As a banker, which would you rather say to a loan applicant:  “I'm sorry but we must decline your application,” or “The Enterprise Center has a lending program that may be able to assist you since we are unable to approve your request.”

You now have a choice.  The Enterprise Center’s “Second Look Program.”

Generally speaking, business lenders do not like to say no to a business loan application.  But what if an application for a micro or small business loan does not meet your lending institution’s underwriting standards?  Maybe the applicant doesn’t meet your equity requirements.  Or the credit score is just below your institution’s standard or lacks acceptable collateral.  Your institution has a policy which limits its ability to loan to start up ventures.  Why risk losing a potential customer?  Refer your applicant to The Enterprise Center for a second look.

The Enterprise Center’s mission is to assist individuals who are unable to secure capital from traditional sources.  Therefore we can take a slightly different view on these applications.  The Enterprise Center will consider a start up business (maximum loan amount $25,000) or applicants with limited equity and/or collateral.  We can also provide gap financing.  Suppose an applicant requests $100,000; however, based on collateral requirements, your bank can only lend $75,000.  Let The Enterprise Center consider a $25,000 subordinate loan.

Why look to The Enterprise Center?  We are not competing against you.  You retain any depository relationship and other banking services.  We work with the entrepreneur to help them establish and grow their business and hopefully become “bankable” when they seek the next round of expansion capital.

For additional information or to discuss a possible applicant please call Al Hartsig at (585) 340-3304 or e-mail at:  This e-mail address is being protected from spambots. You need JavaScript enabled to view it   

These are some of the loan products offered by our member agencies. They are subject to change. For more information, contact the agency directly.

Small Business Capital Needs

Micro business failures – what is their main cause? In over sixteen years of micro and small business lending The Enterprise Center can trace numerous business failures to two main causes: events in the entrepreneur’s personal life (divorce, major illness, etc.) and insufficient working capital. Since the first issue can not be predicted in most cases, let’s focus on working capital.

Simply put, working capital is available cash in a business after all of the business’ bills have been paid. Sales generate cash, right? Yes, BUT. Before the cash register can ring up its first sale cash must be spent. Leasehold or building improvements; fixtures; insurance; utility deposits; office and cleaning supplies; computers and software; and attorney’s and accountant’s fees to name a few all need to be paid before the business can even open its door for business. And this does not even count inventory, which for most micro businesses must paid COD.

But you say this cash has been accounted for with my equity and /or loan. Great. But what if? What if sales are much greater than projected? All of a sudden you not only need to replace inventory, but increase inventory to meet demand (and remember you are a new company without a track record of payments and inventory, for now, must be paid COD). More cash than projected must now be used to pay for inventory. And, since you opened in January and it’s the coldest January on record, your utility bill is double what you expected. The extra cash went toward inventory and is now unavailable to pay your utility supplier. You are now in a cash short position, or you are short working capital. And this is a good scenario, sales are exceeding projections. Just think what would happen if sales were well short of plan?

How do you prevent this situation? Plan. . .plan. . . and plan some more. Run what if situations: What if sales are below projections? What if sales exceed projections? What if expenses exceed plan? What If . . . you get the idea. Plan your working capital needs for the worst case scenario.

It’s much easier to secure the extra capital before you dig yourself into a financial hole due to the lack of working capital and planning. Contact MicroBiz Buffalo to help your business succeed.

From cartoons

The Historically Underutilized Business Zone program (HUBZones) was developed to assist small businesses in certain economically distressed communities gain access to Federal contracting opportunities.  All Federal agencies are required to set aside 3% of their procurement opportunities for businesses located in and certified as a HUBZone-based small businesses.

There are three types of contracts available: Competitive, Sole Source, and full and open competition.

1. A competitive HUBZone contract can be awarded if the contracting officer has a reasonable expectation that at least two qualified HUBZone small businesses will submit offers and that the contract can be awarded at a fair market price. 
2. A sole source HUBZone contract can be awarded if the contracting officer does not have a reasonable expectation that two or more qualified HUBZone small businesses will submit offers, determines that the qualified HUBZone small business is responsible, and determined that the contract can be awarded at a fair price.  The government estimate cannot exceed $5 million for manufacturing requirements or $3 million for all other requirements.
3. A full and open competition contract can be awarded with a price evaluation preference.  The officer of the HUBZone small business will be considered lower that the offer of a non-HUBZone/non-small business, providing that the offer of the HUBZone small business is not more that 10 percent higher.

To qualify as a HUBZone small business a small business must meet all of the following:

1. it must be located in a "historically underutilized business zone" or HUBZone,
2. it must be owned and controlled by one or more US Citizens, and
3. at least 35% of its employees must reside in a HUBZone.

Much of the City of Buffalo is located in a HUBZone, but it can vary by census tract and street locale.

This designation is very useful when marketing your supplies and services to Federal Procurement Agents.

For more information about HUBZones, whether your business is located in a HUBzone or what you need to do to get your business certified as a HUBZone-based small business, please contact us.