Credit Cards, Personal Credit, Business Finance, Credit Information
|
Credit Cards, Personal Credit, Business Finance, Credit Information |
|
|
| Compare credit card deals in your location and find the best card for you | |
Reasons For A Small Business Credit CardSmall businesses in the U.S. are growing faster than ever and continue to be the backbone of the American economy. To grow and operate efficiently small businesses need access to all types of capital, and in particular unsecured credit offered through small business credit cards. The number one reason for business failures involves insufficient capital and business credit cards can help smooth out the ups and downs of small business capital needs. Listed below are greater details on why small businesses can benefit from a corporate credit card. Extending Cash FlowFor businesses that rely on consistent cash flow to pay for supplies or contactors (such as landscapers, hair salons, interior designers), a business credit card that can aid in purchasing items from clients before invoicing customers is ideal. For example, a landscaper may use a credit card at the beginning of the month to buy materials from a wholesale nursery and then pay it off when the statement comes, after the customer has paid. This way, money paid out does not need to come out of the landscaper’s cash accounts. If your business falls under this situation, you should look for a business credit card with high credit limits and benefits for paying off within 30 days. If your billing cycle to customers goes longer than 30 days, look for a low interest credit card so it won’t matter if you carry a balance for a month or two. Flexible Credit LimitsCredit limits for business credit cards come in two varieties – preset by the credit card company and no-preset. Credit cards with preset limits are usually fairly generous and normally do not carry an annual fee. Business credit cards with no-preset spending limits, such as those from American Express do carry an annual fee but offer the flexibility. If your business spending is prone to significant spikes due to inventory purchases, for example, a credit card with no-preset limits can offer welcome flexibility. However, if you are the type of business that works primarily on a cash basis or that doesn’t need to purchase inventory on a regular basis then a credit card for periodic or emergency uses would be best. Look for a small business credit card that offers a moderate credit limit with a low annual percentage rate (APR). This way, if extra money is needed, it is available for your business and can be paid out over time. Business Credit Cards with RewardsBusinesses that require frequent travel and/or client entertaining should look at business credit cards that offer reward benefits. For example, frequent flyer business credit cards offer benefits both for making charges to their cards and for flying their airlines. Business spending can also be leveraged to earn significant cash back or merchandise rewards. Consult with your accountant on how these benefits can be used for either business or personal use. Expense ReportingMaintaining proper records is crucial for small business expense reporting and profitability analysis. Credit card statements – particularly year end statements can be invaluable for small businesses to monitor spending by category, report rewards and simplify tax preparation. How your business chooses to use credit needs to be discussed between you and your financial advisor or accountant. Making the right choice when it comes to a business credit card can help make your business more of a success.
|
| CreditFront.com Limited CreditCards.com |