Answer:
The case depicts the importance of Small Business Administration. It protects the rights of the small businesses thereby providing them a fair share of government contracts. The administration launches multiple schemes and provides loans on minimal interests. It has various sections and each section is made up with a specific action to help small business owners.
Person W borrowed the loan with the help of SBA. Being a minority member, she got a loan sanction through SBA's section 8(a). It was a second mortgage home loan which implied that one mortgage loan was already taken by her.
Section 8(a) of SBA is especially designed for small and disadvantaged businesses. It is a business assistance program which provides loans to the socially and economically disadvantaged business. The government ensures that the loan is provided to the minority and other disadvantaged persons easily.
She was a black female who worked for 13 years in various departments at Company HAC. She gathered up the courage and decided to launch a business. She got the loan of $65,000 under the specialized section of the society and started her venture.
Answer:
The requirement of capital helps the owner to regulate the business. It is known as regulatory capital and capital adequacy. It is that capital amount of bank which should be required by the financial regulator.
The managers of small business can use the needs of project working capital which is known as cash budget. The managers should make the budget to do regulate the business expenses.
This budget helps to make an estimate of what will be the out-of-pocket expenses takes place in a coming year. It helps to produce a product for sale. The revenues may get changed from one period to another period and the producing cost is constant in nature.
Answer:
The case highlights multiple organizations which provide funding options to small businesses. Each alternative has its own terms and conditions of working. One thing which is common in all alternatives is to invest in the business that seems to have high potential growth in the near future.
Business incubators are firms that help the start-ups by providing them management training and office spaces. These incubators act as a catalyst for development of small businesses. Person K can opt for these incubators as she is on the verge of expanding her business. She can get low cost work-space and mentorship which in turn accelerate the business growth. These firms also provide capital in the form of loans with minimal interest charge.
Person K's greeting cards have already got the recognition by beating the designs of other 160 companies. Getting help from business incubators will increase the worth of her business model and the success rate will be high. It can be concluded that incubators can work really well if the business model has the potential to grow.