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Thwarting office theft, and making the most of revolving credit lines.

By Inc. staff | 
 

Q. My consulting firm has been robbed twice in the past six months. What should I do for extra security?

Jim Crum, BOSS Corp., Duluth, Ga.

Warning: Opponents of the Patriot Act won't like the following advice. But here it is: Monitor. To deter rapscallions from crossing the threshold, place visible security cameras in what we assume is your already well-lit hallway. Inside you'll want to be more discreet. Bo Dietl, CEO of New York City-based security company Beau Dietl & Associates and a former NYPD cop, suggests installing pinhole cameras in smoke detectors or other things that don't move around. The cameras are undetectable so thieves can't disable them and employees won't feel Big-Brothered. And they can route video to a closed-circuit television or even to your laptop. Such surveillance systems cost between a few hundred and a few thousand dollars, depending on their caliber.

Locks are also, well, key. Store valuables in a room with a high-grade lock and limit access to your most trusted employees, recommends Dietl. Electronic access cards work best because they're hard to duplicate (and just try picking a reader slot with a hairpin). Keep a record of all cardholders, and should one leave the company, make sure he or she returns the card.

Because your office may have its own distinct vulnerabilities -- it's on the first floor of your building, say -- you may want to invite a police officer by to make specific suggestions (a service some local forces provide for free). Also, enlist employees and maintenance workers in your crime-fighting efforts. Ask for their ideas. Remind them to lock up when they call it a day.

And remember, sometimes theft is just a cost of doing business. After Andy Hyman's Atlanta-based vintage jersey store, Distant Replays, was robbed a few years ago, he ponied up $70 a month for 24-hour alarm surveillance and installed extra cameras and lights inside and outside his shop. A camera in the parking lot helped police track down a credit card thief. But the warehouse was robbed. "You can't think of everything," Hyman says. In other words, you can take a bite out of crime, but you can't guarantee a clean plate.

Q. I'm thinking of taking out a commercial line of credit for my company. How does this work? What size is appropriate?

Bill Kelley, Compressed Air Systems, Tampa

Think of commercial -- also known as "revolving" -- lines of credit as a bridge over your company's troubled waters. These credit lines can help you cope with short-term gaps in cash flow resulting from, for example, punctuality-challenged customers. The lines are a lot like credit cards: How much you borrow -- below an established limit -- is up to you.

Revolving lines are offered by banks and commercial financing companies, although the latter tend to specialize in smaller loans for start-ups. Rates vary; the norm is prime plus 1%. Some banks charge an additional fee for maintaining an open line, but they may waive that for customers they know. Since interest accrues, it's a good idea to pay off your balance as quickly as possible. (Most credit lines expire after one year anyway, so the clock is ticking.)

What you'll want is a credit line that covers at least 30 to 90 days of operating expenses, says Donna Hugly, owner of Hugly & Co., a Dallas accounting firm that advises entrepreneurs. What banks will want to give you is more like 60% to 80% of your accounts receivable, or up to 30% of your inventory's value. To increase your limit, use a guarantor, such as an investor, suggests Kathie Sowa, a national loan executive at Bank of America in Sacramento, Calif.

Also, bear in mind that, just as outstanding credit card debt affects your credit rating, a line of credit may turn up in the "con" category if you're being considered for a business loan. When Jim Kalb, president of San Diego-based importer Triad Partners, applied for an SBA loan recently, the bank treated his entire line of credit as potential debt. For a happier outcome, suggests Hugly, lay out a long-term borrowing strategy with your banker. Such cooperative planning is to the company's credit and in the banker's interest.

Resources For more tips on office security, visit the website of the National Crime Prevention Council (www.ncpc.org), or view the latest technology from spyware company Quark (www.quarkresearch.com). To learn more about lines of credit, check out the financing Q&A and the credit line calculator in the small-business resource center on Bank of America's website (www.bankofamerica.com).

Looking for answers? Stumped by a thorny business problem? Let Inc. help. Send your questions to Askinc@inc.com.


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