Small Business Loans Drop By $10 Billion
(From CNN.com, today)
"Some banks are unapologetic about their cutbacks. Small business
defaults are soaring, and banks are under pressure to shore up their
balance sheets and reduce their exposure to risky loans. Two key small
business lenders, CIT Group and Advanta, filed for bankruptcy this
month."
This is not paranoia. This is reality.
I have been telling folks this for the last month via;
- Radio programs
- Interviews
- Blog articles
- Phone consults
- Franchise seminars
- Social media
- WhiteHouse.Gov
Some folks feel that I am sometimes a little negative.
Some folks feel that I speak the truth-even if it is negative.
What do you think?
Thomas,
Do you happen to know of any low-investment franchises?
David,
Thank you for letting me know that I'm not paranoid.
The Franchise King
Joel Libava
Posted by: The Franchise King | November 20, 2009 at 01:56 PM
Joel, while I think you are 100% not paranoid, as critical an issue as available credit is consumer confidence. I'm guessing you saw the NFIB small biz trends study which suggested that businesses need customers as much or more than they need credit.
So, keep a balance with the positive news, both about the the overall economy and where capital is available. I think you do a pretty balanced job already. The more we focus on the positive maybe we can encourage consumers to refuse to participate in the recession.
Posted by: David Criswell | November 20, 2009 at 01:38 PM
I think you are being accurate. Small businesses so not have access to precious loans and I don't see it changing. The Franchise Update folks said we were in a 'technical recovery' and that the real recovery would come in 4-5 years. This was simply because it will take that long to fix the banking crisis and loosen up the credit crunch so banks begin loaning again.
Good news for low-investment franchises, though and I would think that franchises that offer internal financing would do great.
Posted by: Thomas Scott | November 19, 2009 at 11:45 AM