How Online Banking is Changing the Industry

Back in the day, people walked into their banks and stood in long lines to deposit checks or make withdrawals. With the birth of automated tellers, direct deposit and online banking, consumers have slowly withdrawn from face-to-face visits. Online banking is changing the industry and the role of bank branches has changed with it.

Online banking

While online mobile connections make simple transactions more accessible and efficient, there is still a need for the local bank branch. A recent survey from Bankrate.com reveals that 30 percent of Americans haven’t visited a bank branch within the past six months. When they do go, the purpose of their visits is no longer to make a simple deposit or withdrawal – they want consultation and personalized attention.

Impact of Age

The Bankrate.com survey also found that the age of the consumer has an impact on how they do their banking. For example, 52 percent of banking customers age 50 and older have visited a bank branch within the past 30 days. Only 42 percent of consumers age 30 and younger have made their way to a bank branch in the last 30 days.

Older Americans are traditionally slower to adopt new technology, such as online and mobile banking, but as time passes, they have learned to embrace it. According to a study by Digital Insight, 36 percent of seniors and 60 percent of Baby Boomers were actively using digital banking in 2011, as compared to 40 percent and 64 percent respectively in 2013. That number is predicted to increase to 55 percent of seniors and 70 percent of Baby Boomers by 2016.

Impact of Technology

Fewer customers visit bank branches to handle routine transactions that can now be done on their mobile devices and desktop computers. As a result, the size and layout of bank branch locations is beginning to change. They’re smaller, and the teller line is no longer the central focus. The emergence of automated kiosks for express services and financial loan officers with tablets who can cater to customers anywhere in the room is a direct impact of technology.

While mobile and web technology are expected to continue eclipsing brick-and-mortar branches in the future, don’t count out the branches completely just yet. People may have taken day-to-day transactions into their own hands, but consultation for financing and resolution of account problems have come to the forefront of face-to-face banking needs, and the value of real human interaction there isn’t likely to diminish anytime soon.

Economic Impact Abounds As NCAA Narrows to Final Four

March may be over, but the madness is in full swing as the NCAA tournament comes down to the Final Four. With barely a week to go in this annual fascination with college basketball, companies large and small are feeling the financial effects – some good, some not so much. Whether they’re plagued by employees losing productivity or bolstered by a sudden influx of tournament-hungry patrons, the impact is undeniable.

Crestmark March Madness

A Blow to Productivity

According to a recent report from outplacement and career transitioning company Challenger, Gray and Christmas, more than 50 million American workers are participating in office pools. While the annual practice may have cost companies approximately $1.2 billion in lost production time in the first week of the basketball tournament alone, the firm has cautioned corporate executives to avoid taking a hard line against bracket pools, friendly discussions at the water cooler and those taking time out for updates. A blow to employee morale and loss of camaraderie could be even more costly to a company’s bottom line in the long run.

A Rise in Morale

While the setback to productivity has declined as the basketball games have transitioned to evening and weekend play, the excitement of bracket busters and newly formed kinships at the office continues. Companies that allow employees to wear their favorite teams’ colors or check office pool updates on the clock can still reap the benefits of enthusiastic workers. A pre-tournament survey by staffing services firm OfficeTeam found that 32 percent of the 300 senior managers surveyed believed that support of March Madness activities had a positive impact on worker morale, compared to just 20 percent in 2013.

A Boon to Business

On the other side of the financial fence, many merchants have seen a rise in business during the NCAA tournament. Hotels, restaurants and shops in host cities have experienced a surge in bookings, as have providers for air and ground  transportation. Mid-West bracket host city Indianapolis, for example, expected a $20 million spending impact from this past weekend’s showdowns between the University of Kentucky and University of Louisville, as well as the University of Tennessee and University of Michigan. Kentucky eked out a win against Michigan amid an economic boost for Indianapolis merchants.

Meanwhile, restaurants and sports bars throughout the country offering televised games with food and drink specials are drawing record crowds of their own. In some cases, employees for these businesses are picking up extra shifts and working longer hours to meet the demand.

With the semi-final games set for Friday, April 4 and the championship on Sunday, April 6, 2014, the eyes of millions of Americans are on the Florida Gators, Connecticut Huskies, Wisconsin Badgers and the Kentucky Wildcats. While there’s no doubt that the economic impact of the NCAA tournament has created both winners and losers, only three games remain until it’s back to business as usual.

Michigan-Based TIP Capital Named as Top 25 Independent Leasing Company Nationwide

BLOOMFIELD HILLS, MI – TIP Capital, a leading equipment financing and asset management company headquartered in Bloomfield Hills, Michigan, was recently ranked as the 12th largest private independent leasing company in the United States for 2013 in terms of new business volume by the Monitor, the leading independent trade publication in the equipment finance and leasing industry.

In 2013, TIP Capital generated $147 million in equipment lease financings to rank first out of all independent leasing companies headquartered in the state of Michigan. TIP Capital’s lease volume increased 42% year-over-year from 2012.

“We are very pleased with our 2013 results, and to be recognized as one of the Top 25 independent leasing companies in the country,” said Scott Grady, President of TIP Capital. “We had a record year for new financings and we look forward to continued growth and a strong 2014.”

Established in 1999, TIP Capital develops flexible equipment lease financing solutions for its end user customers and vendor partnerships throughout North America. These customized lifecycle management programs utilize web-based lease applications and asset management tools through a secure private cloud platform

Crestmark Equipment Finance Selects ASPIRE™ From LEASETEAM, Inc.

OMAHA, NE March 10, 2014 — LeaseTeam, Inc., the premier solution provider in the equipment and finance marketplace, is pleased to announce Crestmark Equipment Finance has selected LeaseTeam’s single system end-to-end lease and loan management solution.

Crestmark Equipment Finance services two business channels: middle market, asset-based high technology and small ticket vendor-driven business. To support these two separate business models and continued growth, they needed a solution that offered tremendous flexibility from a partner with expertise in both business models.

According to Jeffrey Emrich, Chief Information Officer for Crestmark Equipment Finance, “Our niche is to provide a customizable experience for our customers. To do this we needed a platform that could easily handle different types of transactions. It was essential to select a platform that was flexible enough to handle both our asset-based company as well as our small ticket vendor business, as each business channel has very different work flows.

Jeff Emrich continued, “After going through a thorough business and solution assessment, we were convinced ASPIRE was the solution we needed, both now and into the future. We were also impressed with LeaseTeam’s expertise. The support has been great.”

“We’re very excited to add Crestmark Equipment Finance to our growing list of ASPIRE customers,” said Jeff Van Slyke, VP of Business Development LeaseTeam. “TIP’s diverse business model necessitates quick turnaround times, for their small ticket business, and structured /customized service for their middle market business. ASPIRE’s flexible architecture created a natural fit for meeting these requirements. ASPIRE‘s true end-to-end capabilities provide the efficiencies, transparency and visibility that is required to be nimble, and its open architecture provides the opportunity for a customized user experience. There’s an opportunity for them to do a lot of innovative things and we’re excited to be part of that.”

School Districts Should Leverage Technology Leasing to Acquire New Equipment

Last week, Grosse Pointe Public Schools in Michigan saw voters defeat a $50 million proposed technology bond issue to replace/add generators, upgrade phone systems, add new security cameras and doors, and install a private fiber-optic network.

According to an article in the Detroit Free Press, the proposal was defeated 8,617-3,718 (unofficial results). The 10-year measure would have raised taxes for school purposes by 23%, adding 2.28 mills in the first year and costing the owner of a home with a taxable value of $100,000 an additional $228 a year.

In response to the Grosse Pointe Schools’ defeat, The Detroit News published an editorial on how leasing technology equipment could provide a sustainable answer to the district’s needed upgrades. With the rapid pace of today’s IT, security, energy-efficiency and technology equipment, leasing has become commonplace with many of today’s forward-thinking businesses – although historically school districts have not pursued leasing as an option, according to the article.

Crestmark Equipment Finance has partnered with many technology-based equipment manufacturers and vendors in the IT and security channels to offer municipal equipment leasing programs successfully within neighboring states. These districts and qualified municipalities see the value of leasing and the use of the equipment to stay ahead of the technology curve without risk of technology obsolescence through a direct cash purchase (or bond proposal).

With technology leasing, the school district selects the equipment vendors, the lease term (months), invoicing terms (monthly, quarterly, annually) and the end of lease buyout or renewal. Crestmark Equipment Finance works with their selected equipment providers to develop a fixed rate payment based on the preferred term selected of the school district (standard is 3-5 years).

Crestmark Equipment Finance also serves as an independent, vendor neutral equipment financing company, which means we do not have specific manufacturer ties which allow Crestmark Equipment Finance to lease multiple types of equipment into one lease agreement. For example, we could provide financing for Cisco servers with IBM laptops and Apple iPads, security and access control systems, energy-efficient generators, and even office furniture all bundled into one lease agreement.

At lease end, Crestmark Equipment Finance will work with the school district to offer many lease purchase buyout options: purchase the equipment; renew the lease for a specified time frame; or remove and install new equipment. The school district selects the option that best fits their equipment needs, their teachers and their students.

With school districts winding down over the next few months, Crestmark Equipment Finance can work with municipalities now to line them up for the upcoming school year to get the proper equipment installed during the summer months and ensure everything is operational and ready for September.

For more information about our diverse equipment leasing programs for Michigan school districts (or nationwide), please contact Crestmark Equipment Finance or call 888.999.8050.

Small Business Borrowing on the Rise at the End of 2013

The borrowing for U.S. small businesses increased near the end of 2013, which has analysts optimistic about the economic outlook for 2014.

This increase, reported by the Thomson Reuters/PayNet Small Business Lending Index, measures the volume of finance lent to small companies. At 120.4 in October and 111.4 in November, this level is the highest since August 2007—right before the financial crisis set in. Additionally, November, which only had 20 working days, saw the highest per-day borrowing rate out of the entire year.

This kind of increase points to an optimistic U.S. economy. Normally, a high level of small business borrowing is correlated with overall economic growth because small companies produce more goods and increase assets, ultimately resulting in more money infused into the economy as well as the creation of more jobs.

“It’s another sign of continued expansion,” PayNet founder Bill Phelan said, according to Reuters. Small businesses “are seeing more demand for goods and services, and that’s all good for GDP.”

Fewer Delinquencies

With lighter financial burdens, small businesses have been able to not only borrow more, but also pay back those loans in a timely manner.

The percent of small business loans unpaid at 31 days past due and 180 days past due was down to 1.43 percent, which according to Reuters, is a new record low. For a little perspective, the number of delinquent loans reached a high of 4.73 percent in August 2009 and has steadily declined since then.

Looking to the New Year

Because PayNet’s lending index has typically correlated in the past to more overall economic growth for the next one to two quarters, analysts believe the US economy should continue to improve in 2014. Some factors in improving the outlook will be actual financial infusion—such as more business production—but the attitude of the American consumer will also play a key role.

Staffing for the Online Era

Staffing a business used to be a fairly straight forward process: a manager would receive a résumé, conduct an interview, and decide whether or not the candidate fit with the company. But as technology has advanced, the internet has begun to play a larger and larger role.

From places like Elance to SITE, online staffing sites have hundreds of thousands of job postings with hundreds of millions in revenue, covering all industries, skillsets, and experience levels. So, what does this mean for the industry as a whole?

It means that things are changing for the better, and there are benefits for both job seekers and employers.

Online ERA

Benefits for Job Seekers:

Job seekers can find a multitude of opportunities: from a project that may involve one or two assignments for supplemental income, to ongoing and long-term contract opportunities. And with the ability to search based on keywords related to their qualifications, job seekers can drastically cut down the time it takes to find relevant positions to apply to.

This changes the game dramatically. Rather than relying on a recruiter, job seekers have the power to take their search into their own hands.

Benefits for Employers:

For the employer, utilizing online tools allows them to automate many of the processes that previously needed to be completed manually. In other words, employers can use new tools to save money .

While taking the industry online doesn’t eliminate the need for recruiters, it does reduce both the effort needed to recruit and the money spent on recruiting. According to Forbes, recent data found that businesses around the world spend more than 3,300 per hire on recruiting alone, which is actually up six percent from previous years. This equates to the U.S. spending 72 billion on recruiting services per year, with the international numbers nearly three times that.

As the staffing industry continues to shift online, the need for companies to invest in technology will continue to rise. That’s where Crestmark can help. If you have a staffing company and are in need of capital to grow your business, give us a call today!

Winning Over Lenders by Being Prepared: What You Need as a Small Business Owner

Getting a small business loan can be a challenging task when presenting a valid case for lending. So what information and paperwork are you going to need when applying  to a lender in hopes that they will not only set you up with a loan, but will also get you a favorable one?

First, be confident in your loan request. Know the amount you will need to fund your growth, be prepared to discuss what opportunities and income will come from this loan, and go in prepared with statements and research to explain the costs of everything from raw materials of new product to marketing expenses. Be as detailed as possible

Whether you’re applying to a traditional or alternative lender, the following materials should be prepared ahead of time:

  • Proof of a good income record
  • Any necessary loan applications
  • Personal Background and Financial Statement
    •  Statement of Personal History
    •  Personal Financial Statement
  • Business Financial Statements (for the last two fiscal years)
    •  Profit and Loss Statement
      •  Current within 90 days of your application.
  • Projected Financial Statements
  •  Projected income and finances for the next year with an explanation of how you will attain that goal.
  • Ownership and Affiliations
  • Business Certificate/Licenses
  • Loan Application History
  • Income Tax Returns (for the last two years of filings)
  •  Business Overview and History
    •  Bring a brief statement highlighting the history of your business and its successes and/or challenges.
    •  Explain in this why you need a loan to continue its success.

When meeting with an alternative lender, you will need to prepare a few additional documents beyond those listed above. An alternative lender like Crestmark can offer more flexible funding options, and has the ability to work with businesses that would not otherwise qualify for traditional bank financing. If you’re looking to win over an alternative lender, they may be interested in also seeing the following:

  • Accounts Receivable Aging/Detailed (current month-end)
  • Customer Contact List, including city and state
  • Accounts Payable Summary (current month-end)
  • Invoices and Supplementary Back-Up
  • Purchase Orders/Contracts
  • Detailed Inventory Report, showing raw and finished goods, as well as work in process
  • Marketing brochures, informative business overview

Keep in mind that while this is a list of commonly-required documents, it’s important to check with each lender before meeting with them. Also, documentation is a good start, but it’s really only half of it. You’ll also need to be prepared to sell your business and yourself as its leader. Prove that you’ll be a valuable and trustworthy investment by showing a plan to pay back the loan, strong credit statements showing you have creditworthiness and several reasons why you believe your business has a solid chance at success with this funding.

Are you in the process of looking for a lender? We want to help, and have professionals ready to discuss your business capital needs.

Four Ways to Know if a Business Line of Credit is Right for You

Business line of Credit

Starting a new business is not the only time an entrepreneur may look for help with financing. Some small business owners—especially those who operate seasonally—experience fluctuations in cash flow throughout the year. A line of credit can help to smooth over the ebb and flow of sales and cash flow throughout the year.

A business line of credit provides on-demand funding, and there are a number of different types of lines of credit ranging from unsecured, meaning that it is not backed by any kind of assets; to secured, backed on a general basis by all assets of the company, or by specific assets that are structured into the funding formula of the line of credit.

Here are four questions to ask yourself before approaching a lender:

1.) Does your business have uneven cash flow? The best use of a business line of credit is for paying off expenses in the short term that can be easily paid off in the long term. This works well for short term expenses such as payroll and inventory.

2.) Are you able to pay off the balance of your credit line? It can be tempting to carry a balance on a line of credit, but this will ultimately damage both your relationship with the lending bank and your company’s financial health. Unless you are able to pay off the balance quickly, you should not run the risk of borrowing against a line of credit, but possibly consider a term loan for long term items like buying equipment.

3.) Would a business credit card be more appropriate for your needs? A line of credit will have a lower interest rate and higher credit limit than most business credit cards. It will not, however, provide line by line tracking of expenses along with date and location of purchases. This can be very valuable for record keeping and future planning, and also allows you the flexibility to provide individual cards to key employees/staff for travel or other day to day business expenses.

4.) Are all business owners available to apply? If your business is a partnership or has multiple owners, at least 80% of the owners must be represented in the credit application. This makes applying for a line of credit a decision that must be made across all owners of your business.

If you are just starting out, looking to obtain working capital for your existing business, or want to grow from your established base, Crestmark’s business development team can work with you to determine which type of financing solution is the best fit for your current business situation.

Equipment Leasing 101: Choosing Between a Fair Market Value and $1 Buyout Lease

In this week’s blog, Crestmark Equipment Finance explains typical end of lease purchase options available to a customer when the lease terminates at the end of his or her selected monthly term. In the equipment leasing industry, the “standard” buyout options consist of Fair Market Value (FMV) and $1 Buyout (or $1 Purchase Option) with a term ranging from 12 to 60 months.

• A Fair Market Value Buyout allows the customer to utilize the equipment for a designated number of months with end of lease options to continue to lease the equipment, return the equipment and upgrade to new equipment, or purchase the equipment at the then determined fair market value price of the equipment. A FMV lease also is known as an operating lease.
• A $1 Buyout/Purchase Option has a higher monthly payment than a FMV lease, but this lease is selected by a customer who wants to own the equipment at lease end for $1. This lease also is known as a capital lease. Most of the time, the equipment ownership is transferred from the lessor (Crestmark Equipment Finance) to the lessee (customer) unless the customer decides to return the equipment for remarketing or disposal.

As stated above, the customer selects the buyout option and the length of the equipment financing term, which consists of a fixed rate monthly payment that does not fluctuate during the lease – unlike other financing options such as credit cards or bank loans. These “other” financing methods also can eat away at your operating budget.

When considering an equipment leasing buyout, your business or municipality needs to consider the equipment type and its lifecycle before selecting the FMV or $1 Buyout purchase option.

• Clients typically select a FMV buyout for IT, computers, servers, software, security systems, GPS, or other technology-based equipment to avoid equipment obsolescence due to the ever-changing dynamics of today’s – and tomorrow’s – technology-based equipment.
• Clients typically select a $1 buyout for longer lasting equipment such as construction, automotive repair, material handling, tooling, cleaning equipment and pressure washers due to the longer lifecycle of these assets.

As our client, Crestmark Equipment Finance will develop a competitive, fixed rate equipment financing option to match your preferred buyout option and lease term and acquire the equipment to complement your business needs without a large upfront down payment or worry of technological obsolescence.

If you have an immediate interest in leasing equipment, please contact Crestmark Equipment Finance or call 888.999.8050..