The Game of Business Credit Cards
The Game of Business Credit Cards
Sometimes, when financing for your new business venture seems a little hard to find, you might want to consider the business credit cards offered by the different issuers. Business credit cards are rapidly gaining popularity among small business owners, who have seen these very useful as alternative financing sources.
Small business owners and would-be entrepreneurs are not as well connected to sources of high finance with which to bankroll their projects. Business credit cards can be their door to that opportunity or, at the very least, a much-appreciated lifesaver for existing businesses from time to time. It is not unrealistic for the small business owner to anticipate that a cash-flow crisis could occur at anytime. Perhaps for this reason, business credit cards are seeing wider use as a source of financing, with some of the business credit card holders learning the game of how to make things really work to their advantage.
For instance, small-business owners who keep their business credit cards on file with their regular vendors can help eliminate COD charges, receive expedited delivery services, and get the chance to stretch their cash flow by a few extra yards. Your business can conserve cash for a little while longer by charging supplies to the business credit cards at the beginning of the billing cycle – which gives you a float of about 21 days.
It cannot be said too often: business credit cards can really help you manage the business better. That you can use the business credit cards for travel and client entertainment is well documented. Less well known is, that at the end of a quarter, the period expense account summaries from your business credit card companies are a big help in reconciling your transactions and preparing your quarterly tax filings. More than that, if you take the time to review the summaries, you will have the ability to uncover some potential trouble spots. You may find out where the business is incurring too much expense, and that employee is causing the financial leak.
You will also observe that due to the competition among issuers, many business credit card issuers offer you zero-percent interest rate for balances transferred from another business credit card company to theirs. This presents you with a really great opportunity – if you go about it in a smart way: You can capitalize on these zero-interest offers by continually moving your balances from one business credit card to another business credit card without ever having to pay market rates. This is a perfectly legitimate strategy, and there are more than enough business credit card issuers out there asking business credit card holders to do exactly that.
You can play it as a kind of game. You would never run out of new business credit cards to jump into when the introductory period on one business credit card is about to expire. If you do take this tack, be alert about keeping on top of your statements and your expiry dates.
It will also work in your favor if you transfer your business credit cards when you observe interest rates starting to rise. As an alternative, you could speak with your existing business credit card issuer to see if they are willing to bring their rates back down. Note, though, that repeated applications for business credit cards may impact your credit report, so keep an eye on acceptable periods for credit inquiries.