Tag Archives: small business

Regulatory Relief Bill

Thanks to the power of grass roots advocacy and the support of pro-community banking elected officials, Washington has approved a very much needed regulatory relief bill.

The landmark Economic Growth, Regulatory Relief and Consumer Protection Act provides regulatory relief to our nation’s community banks, so they can continue financing and supporting the dreams of Americans in local communities like ours. For far too long, local community banks like Iowa State Bank and Trust have been hand cuffed by ever-increasing federal regulations that have raised costs, reduced local credit availability, promoted the decline in new bank formation, sparked bank consolidation, and lowered consumer choice while not providing any meaningful abatement in overall risk in the financial system.

By unleashing the economic power of community banks, lawmakers are providing greater access to financial services closer to the people of our farms, businesses, families, and organizations, and with banking institutions that truly puts customers first. This can only help continue our nation’s economic recovery and the growth of our local areas.

There is still more to do to right size financial regulation and scale it to bank size and focus. Bank’s like Iowa State Bank and Trust continue to labor under onerous requirements while trying to compete with government subsidized credit unions and agencies. Our industry will always fight to keep local community banking viable!

– Dave Eastburn, Chairman of the Board

10 Steps to Opening Your Own Business

New Business

Creating the foundation of your next enterprise can be a challenging process. For everything from ideas to permits, it takes a lot to get a new business up and running. At Iowa State Bank we would like to help you make your dream a reality, and offer these ten steps to opening your avant-garde operation:

Write a business plan. Creating the sound reasoning behind what you want to do and how you want to do it, represents the building blocks to a good business. There are many tutorials to help you develop a plan and to accompany them, we recommend researching information for each section of the document.
Select the best location. Location can make or break a business. In conjunction with your plan’s market research, we suggest scouting out the best potential locations. Adding this element to your proposal can help you create the optimal visualization when describing your concept.
Build a marketing strategy. Great service and great promotion go hand in hand. Unfortunately the old adage, “If you build it they will come,” no longer applies. Now, in order to get clients through the door, you’ll need a structured and continual marketing plan to ensure customers in your area are aware of your business.
Plan your finances. These not only refer to the funds you need to open your business, but also the additional costs to help support the initial years of operation. This extra capital will help ensure your business doesn’t topple while building its ongoing customer base.
Meet with a commercial lender. Once you have the core of your business planned and calculated, it’s time to meet with a small business lender to evaluate your risk. He or she may require a percentage down, or that certain criteria are met before loan signing.
Fulfill any requirements. Whether it’s saving additional funds, offering up collateral, or obtaining designated permits, it is best practice to meet and exceed the requirements that your lender has suggested, in order to maximize your lending potential.
Close on a business loan. After securing the funds for your business, be certain they’re placed within a business account, instead of a personal one. To help ensure your funds are separated, we also recommend creating an LLC for your business prior to opening.
Purchase or lease space. Using the money you’ve budgeted, move forward with purchasing or leasing the space for your new enterprise. After space has been secured you’ll need to acquire equipment and supplies from another portion of your predetermined budget.
Structure and hire your team. Another old saying goes, “If you take care of your employees, they will take care of your customers.” This is a great adage to stick by, as more often than not, people are what makes a business successful. Decide your role within the company, and then craft detailed job descriptions for the rest of your potential employees. Start building your team with the best people for the job, and add further help as needed.
Open and continually promote. The big day has arrived and the doors are officially open. Continue to keep them open through constant and innovative marketing efforts. By pushing your products and services to the public you can ensure that they’re aware of your offerings and consider your business a valued option.

We look forward to meeting with you about your next corporate venture. If you have any questions on how to complete the steps above or have additional inquiries on commercial lending, please don’t hesitate to reach out.

How to Budget When You Have Seasonal Income

Rewarding careers don’t always come with a steady paycheck. For people who work in agriculture, construction, tax preparation, entertainment, landscaping or other types of freelance and seasonal businesses, income may vary wildly depending on the time of year. This uneven cash flow makes budgeting especially challenging, but it’s by no means impossible.

Here’s how to budget for long-term financial stability when your income changes with the seasons.

Determine your average monthly income

With most traditional budget plans, you start by determining your monthly income. But how can you complete this first step if your income keeps changing? The most effective strategy is to use your average monthly income. To calculate this, add up your post-tax income for the past three or more years and divide that sum by the total number of months. If economic conditions have — or are projected to — hit your industry or business hard, you may want to deduct 15% to 20% from this number to create a safety cushion.

Calculate your average monthly expenses

When work is seasonal, expenses often fluctuate, too. During busy times, you may have to spend more on gasoline, utilities, equipment maintenance and office supplies. If you spend more during your busy season, determine your average monthly costs by adding up your personal and work-related expenses for at least one year and dividing that figure by the total number of months.

Fine-tune your budget

Subtract your average monthly expenses from your average monthly income to get your baseline budget figure. If you find you’re cutting things close or dipping into the red, you’ll need to make some adjustments. Consider cutting unnecessary expenses or picking up extra income by expanding your existing business’s volume, taking temp work during slow times or offering complementary services that peak during your off-season.

Become a saver

Having a savings plan is an especially important safety net when income is irregular. When planning your budget, be sure to include a line for saving each month. It’s best if you can put away 10% or more of your income, but even small amounts deposited consistently add up significantly over time with compound interest. Aim to save at least three to six months’ worth of expenses to ensure you can live comfortably during lean times or emergencies.

Additional survival tips

To help even out cash flow and make the most of seasonal income:

Make it easier for customers to pay you quickly by improving your invoicing procedure, offering options such as PayPal or Square to accept credit card payments, or setting up direct deposits to your account with customers.
Negotiate with vendors and suppliers for discounts or extended payment terms.
Take advantage of financial and budgeting software such as QuickBooks.
Consider offering discounts and promotions during slow times to boost business.
Track your cash flow regularly and adjust your budget as necessary.
Even with your budget plan in place, keep spending to a minimum during slow seasons.
Stick to your budget during your busy season to avoid spending the cash you’ll need during the down times.

Seasonal income doesn’t have to mean financial feast or famine. With proper budgeting, you’ll be able to live well no matter what the season.