How Surety Bonds Can Positively Impact Your Small Business
by Stacie Walker, Window Shopper
- Created: October 14, 2012, 11:03 am
I hope this bit of information will help those in this community with funding their new business. If anyone else here has more to add to this discussion, please share your expertise. Starting a small business can be a challenging endeavor. Obstacles such as overcoming market competition, barriers to entry, and personal economics affect many businesses. Surety bonds can play an important role in any small business. When every last dollar impacts the bottom line of a business, some assurances needs to be put in place. A contract may not be performed for any number of reasons from extensive costs, poor labor, understaffing or a party reneging on an agreement. The surety bond protects businesses from these outside factors. A surety bond is a legally binding agreement where one party or business guarantees to another (the obligee) that the third party (the principle) will carry out the terms of their contract. Surety bonds can be purchased from companies that specialize in surety bonds or insurance companies. In order to apply, extensive financial information regarding the business along with funding and credit are needed for review. The cost per bond will be determined after information is collected. The business applying for the bond, the types of surety bond, and the location it is purchased in will factor into the cost. Do you think surety bonds can truly protect your small business from liabilities?
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