B U I L D I N G A W A L L
O F B U S I N E S S C R E D I T
INDUSTRY
INSIGHT
BORROWING
HAS
BENEFITS
Grandpa may have taught you never to
borrow money, but in today’s business world,
having established credit has numerous benefits.
By Josh Fiorini
It may not seem on the surface that walls and
business credit have much in common, but
there is one important characteristic both things
share – you have to build them before you need
them.
Access to capital can be one of the biggest
challenges for a small business in any industry.
Th at challenge is only being made harder for
small businesses in the fi rearms industry today, due
to the pandering, anti-fi rearms stance that is rapidly
spreading among the banking oligarchy.
It wasn’t so long ago that the banking world’s
antipathy towards the fi rearms industry was
government-engendered via Operation Choke Point.
Today, the institutional prejudice seems to be
spreading voluntarily, which may have further
reaching implications, including creating a greater
need than ever for business owners in all aspects of
the fi rearms industry to understand the dynamics of
business credit.
Many readers may come from an ‘old school’
upbringing like myself and are predisposed to
eschew borrowing.
“Grandad built his business with blood, sweat and
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tears, and so will I – not with other people’s money!”
Th is is a healthy attitude in many cases, but the
reality is that access to credit provides fl exibility and
versatility, and those things are essential to growing
a small business.
WHAT IS CREDIT AT ITS CORE AND WHY IS IT
IMPORTANT TO A BUSINESS?
Th ere are many defi nitions of credit, but the more
esoteric version directly underlies the fi nancial one,
and that reads, “reliance on the truth or reality of
something.”
For a business, that means reliance on your good
faith and your willingness and ability to pay. It is
about trust – and trust takes time to build.
Banks charge interest to lend money, as does any
lender. Th e interest rate that one pays is the ‘price of
money’ and is based on many factors, mostly trust;
so for a new business partner, that trust must be
earned or supported.
For a new or small business, the price of
money – the interest rate off ered to them – can be
horrifyingly high and potentially prohibitive. Even
if it wasn’t, lenders will typically require personal
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