In 2020 and 2021 many freelance creative, contractors, and small business owners struggled to secure any amount of support from the federal government, not to mention respective state support amidst national closures.
Sure, it may be true that some freelancers kept on earning, but it’s highly unlikely that a freelancer wasn’t in some way affected negatively by the coronavirus pandemic. Many freelancers and contractors have yet to receive economic stimulus payments for one reason or another.
Small Business and Freelance Trends in 2022
Even despite economic hardship running rampant in the United States, a recent survey conducted by Guidant and the SBTA reflected that nearly 80% of small business owners expected to survive the economic downturn created by the COVID-19 outbreak.
On the other side of the spectrum, 23% of individuals surveyed reported that loss of revenue was the most significant impact experienced by the global pandemic. Small businesses also reported that only 63% of survey respondents had profitable businesses in 2020, a number that is down fifteen points from the previous year’s 78%.
Many news sources report that measures may even be put into place that will limit a household’s ability to receive stimulus payments.
Alternatives to Government Support
Instead of waiting to get some amount of support at the state and federal level, many small business owners and freelancers are seeking other ways to help enrich their situations.
The Small Business Administration (SBA) helps small business owners get loans, but the agency itself is not available for lending money directly, but instead sets specific guidelines for loans made by lender partners, not to mention organizations which specialize in community development. The SBA also has measures in place to connect small business owners with institutions involved in micro-lending. The SBA also reduces risks that lenders take on by lending to small businesses, making it far easier for a small business to get a short-term loan.
The Paycheck Protection Program (PPP) is another avenue small businesses can pursue which provides loans that will help small businesses retain their workforce amidst the COVID-19 crisis.
Tips for Securing a Small Business Loan
Those who lack collateral and who has only been a small business owner/operator for a short period of time and need funding fast should research the best possible sources to retain a loan.
For those who do not have a large enough business for a traditional business loan, micro lenders (nonprofits which typically lend in amounts of less than $50,000 on the short-term) might be a good option.
Making sure that you have proper documentation is hugely important when applying for any type of loan — especially a small business loan. This could also apply to a personal loan as well, which is another avenue you can take.
Those who do have collateral might have an easier process for getting a small business loan as they can use property or equipment to assure lenders, which might also end up having you secure higher loan amounts.
Small business loans are often used for enriching working capital, securing real estate, and even equipment financing. A business might even need to pre qualify auto loan for a company vehicle.
No matter what you use your small business loan to accomplish, it’s important to do your research and make sure that you choose the very best possible option for your specific needs and situation.
A small business loan will not only give you more time and resources to set up or scale your business, but it will also improve the cash flows of your company thereby making it easier for you to sell your business at a higher price or valuation down the line.
