The ‘Wading’ Game
Often, small business owners will find themselves waiting. Waiting for a loan application response, a decision on a proposal, a choice to move forward, and, most often, waiting on payment. How long should that timeframe be before you sink or swim?
Most commercial banks will seek to turn around a loan decision in a five (5) to ten (10) day tImeframe. And that would be business days. Banks need to underwrite the character as well as the credit of an applicant. They will often pull competitive information available on your industry to compare your results to industry averages. They may need to request personal credit reports on the owners if they are providing personal guarantees. All these steps take time. And during this time you wait.
There are often ‘Express’ loan programs businesses can apply for when the loan amount is usually less than $100,000. Express programs will often have a decision to you sooner than the conventional program. Your business will either meet the criteria established for an Express Loan or it won’t. Not much room for interpretation or negotiation. So, if you are in a hurry and do not need a larger six (6) figure or higher loan, make sure to inquire with your Bank about Express Loan Programs.
As far as payment inquiries, most small businesses operate on a thirty (30) day approach. Once your payment has not been received past that timeframe, time to move out of being stuck in the sand. Begin your collection attempts with an email. This provides you with a paper trail and allows you to keep referencing the initial inquiry in future attempts.
Every two (2) weeks is an acceptable professional timeframe to contact your client until information is provided. Always stay professional and use phrases like ‘I look forward to your anticipated response.’ Eventually the client has to respond. Most firms are not intentionally rude or discourteous.
Waiting on decisions for awarded contracts and chosen consultants may sometime vary, depending on the RFP or the contract. Be sure to review these prior to submitting for work. If the RFP says a month, it will usually be at least a month. You can sink quickly here if you apply undue pressure for a decision when its timeframe is clearly displayed in the initial paperwork.
Knowing when to swim or when to wade in that ocean of progress for your company is an important element to properly managing work flow, expectations, and brand reputation. Be like our Golden Retriever this week, your decisions can either make you sink or swim. And if you are not ready to decide yet, stay put, feel the sand underfoot and choose wisely.
Be well.
