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View Full Version : Sam's Club Stimulus Plan



Gerry Clinchy
07-05-2010, 07:39 AM
http://www.nytimes.com/2010/07/05/business/05loan.html?pagewanted=1&th&emc=th

It's so simple, you wonder why it took Walmart to figure it out.

The featured small businessman just needed a streamlined way to apply for an SBA loan. He turned a $10,000 loan into a purchase and created 3 new jobs for the drivers he hired.

A very good example of how a govt program, used with intelligence, and tied to honest small business can result in real return on investment.

Key elements, I think, were the private-enterprise motivation of Sam's Club to come up with the program. Private-enterprise motivation of the finance company to make a small profit on each transaction of anticipated high volume ... and to figure out the way to make an SBA application do-able for even an unsophisticated small businessman.

While the beneficiary businessman says he won't spend more at Sam's Club, I'd venture that he now has a greater loyalty to shopping at Sam's Club and continuing his membership rather than dropping it. And he might not even realize that he does, indeed, purchase more items there that he might have purchased somewhere else before.

With only a 45% approval rate, it does not appear that these SBA loans are falling victim to the financing mentality that fueled the housing bubble.

I'm NOT a Walmart fan, but I can't deny them some respect for coming up with this idea.

depittydawg
07-05-2010, 11:51 AM
[QUOTE=Gerry Clinchy;

With only a 45% approval rate, it does not appear that these SBA loans are falling victim to the financing mentality that fueled the housing bubble.

I spent a few years peddling loans for banks a while back. SBA loans were difficult to get approved. They almost never made it. They had some pretty strict criteria. Looking back now, I'd say the SBA was doing things right and the Banking industry had its collective head up its rear chasing dollars at any cost. Too bad the Fanny and Freddie weren't run the same way as the SBA!