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High Risk Industries for 2021?

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myfavoritehue
New Contributor

High Risk Industries for 2021?

Was recently denied for a small business card with Bank of America.

After speaking with recon, they stated that they would not be able to extend credit because my company is (now) deemed a high risk business.

We sell clothing online. On the application, I labelled the company as "retail" so the automated system read that as a brick & mortar business, which we are not, and automatically declined me. Even after explaining my case, they stood their ground claiming that online clothing is a high risk business.

 

Long story short, I would like to know if anyone has a updated list on what industries are deemed to be high risk and which industries are actually being lent to.

 

I understand that COVID has changed everything but in my research, ecommerce has not had an issue obtaining funding. If you have any recent data points please share.

 

P.S. I did all the research on credit requirments (personal/business), financials needed, etc. I only need clarification on the industries that are still being lended to by banks.

Message 1 of 5
4 REPLIES 4
TGG_1976
Contributor

Re: High Risk Industries for 2021?

I can't speak for specific small business requirements but I work in the eCommerce business for one of the biggest, global companies, since 15 years. 80% of our clients are clothing/ apparel companies. In 2020, we have seen an unprecedented growth for online retails across almost all verticals. We assume currently that the growth will continue or at least sustain itself this year.

It may be, that BoA deems the business risky, because one may assume that business shifts back into stores away from online, but current predictions suggest otherwise for 2021. 

 

Forrester Research (www.Forrester.com) does a lot of studies on the subject, but you need to create an account to get access to more meaningful data. 

Message 2 of 5
myfavoritehue
New Contributor

Re: High Risk Industries for 2021?


@TGG_1976 wrote:

I can't speak for specific small business requirements but I work in the eCommerce business for one of the biggest, global companies, since 15 years. 80% of our clients are clothing/ apparel companies. In 2020, we have seen an unprecedented growth for online retails across almost all verticals. We assume currently that the growth will continue or at least sustain itself this year.

It may be, that BoA deems the business risky, because one may assume that business shifts back into stores away from online, but current predictions suggest otherwise for 2021. 

 

Forrester Research (www.Forrester.com) does a lot of studies on the subject, but you need to create an account to get access to more meaningful data. 


Thank you for the detailed response, as well as that resource.

 

I wholeheartedly agree. In my eyes, you don't even need "data" to know that EVERYTHING is shifting towards going online. It just doesn't make sense how they could come to that conclusion.

Message 3 of 5
Thermionic_E
Regular Contributor

Re: High Risk Industries for 2021?

I originalky wrote two paragraph which I now feel like most of my other posts here have not really remained very topical, but I've left them just in case since they do have to do with the current climate and funding in spite of circumstances that should or do approve it.

 

but yes, I'm trying to find some sort of non traditional funding for a warehouse of hopefully 10-20k square feet. It is frustrating knowing I could easily pay maybe 4-5k a month if I actually could sell my products snd begin production on even more profitable items that my current space has rendered any industrial machines only suited for storage by. I try to speak to brokers and find advice from people about unions, but I guess it just sounds strange. I was making a few thousand on grill cloth sales alone but ran out of what I have on hand months ago and have been unable to get to my warehouse in mississippi and have nowhere to store the amounts I need for it to be worth it. So yes, catch 22s everywhere, and because sales have double for myself during covid but also consequently have made me start making less because I do not have enough to expand but have ran out of items on hand but not out of the inventory... maybe I just need to find a way to streamline and focus so I can make more realistic assessments of my current situation instead of hoping tactile assetts that are certain and fast movers mean anything to institutions that liquidate tactile assets in seizures for fractions of cents on the dollar to half ass recoup on things they already wrote off.

 

 

Sounds like fools being made to once again bend to their algorithmic shortcomings oftentimes like Amazon does. The stupidest thing about this year and last has been the absolutely inane projections and asinine criteria by which not parameters are established and hard data is looked at, never by which someone like myself who has millions of dollars in tactile assetts (most of which do not lose value but gain it and raw materials that are valuable in spite of resell like kovar, molybdenum and copper 110, as well as ss302/4 and 316...) but because of my limits and three year history, all of my inventory is cramped and stacked in an inaccessible manner making logistics and taking inventory impossible and it has only gotten worse since I operate several states over and cannot find a suitable space for lease... the amount I pay in storage fees and warehousing for peppered units and other costs I've incurred from thus having nowhere to store a forklift or proper trailer/s has lost me at least several hundred thousand dollars in what ends up being considered abandoned or forfeit since I have to play Tetris and unload with my physical strength a very limited 8ft truck bed... which really defeats the 90000 I spent on a heavy duty truck. My biggest issue with my business and funding is the inability to translate profit potential to one space that I won't immediately outgrow with the removal of the cap the current situation is causing. 

My girlfriend is essentially used and absurd by rvcv to train and fix and direct all of their photo editing requirements, especially ones that would really improve the bottom line by making things that bad models (tattoos, blemishes, and other reasons to hire anyone else), lighting issues, set screw ups, format/delete problems when uploading, the two second memory and recap of things already thoroughly covered in email, styling (removing wrinkles from every single photo and making it look natural), and of course being told to remove things or fix things that were not a product of editing, like a dog looking completely unrealistic when it is actually in the scene and real. The best part is being paid less than the temps you're training! The point is, these companies are operating on ridiculous levels of credit and ultimately because the shopping has all moved online, she has been doing three times her normal amount of work every weekday and they haven't done a review for two years and she is ignored when asking for any sort of monetary compensation for duties her boss seems to feel she should be inspired to do on her own, and she isn't any kind of project manager or web designer, but because their sales have increased their online store has become their main focus. 

Message 4 of 5
Thermionic_E
Regular Contributor

Re: High Risk Industries for 2021?

Online has freed me from any need to stay in California but I feel so odd about the potential of relocating to where I could get an industrial land and or building grant... what is your current solution in that regard?

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