April 2017 Industry News from Patriot Capital

Fed Increases Interest Rate, Two More Increases Expected in 2017

Citing continued economic growth nationwide, the Federal Open Market Committee (FOMC) voted unanimously to increase rates by a quarter of one percentage point. The committee also announced it expects to increase the interest rate two more times in 2017.

"The economy continues to expand at a moderate pace," Fed Chair Janet Yellen said at a press conference on March 15. "Solid income gains and relatively high levels of consumer sentiment and wealth have supported household spending growth. Business investment, which was soft for much of last year, has firmed somewhat, and business sentiment is at favorable levels. Overall, we continue to expect that the economy will expand at a moderate pace over the next few years."

Yellen said the March increase likely will be followed by two more interest-rate hikes before the end of 2017, "The median projection for the federal funds rate is 1.4 percent at the end of this year, 2.1 percent at the end of next year, and 3 percent at the end of 2019," she explained.

With the cost of financing continuing to increase, businesses planning to make capital improvements would be well served to secure their financing and lock in an interest rate before the cost of borrowing increases further.

Patriot Capital offers a variety of equipment financing options for C-stores, fuel marketers, and jobbers. To get a quick quote, or find an advisor near you, visit the Patriot Capital website or call (877) 527-0383.

In 2015, About 140 Billion Gallons of Gasoline Were Consumed in the United States, a Daily Average of About 389 Million Gallons. - U.S. Energy Information Agency

PMAA Honors Patriot Capital as 'Best in U.S." for Third Consecutive Year

The Petroleum Marketers Association of America (PMAA) has honored Patriot Capital as ‘Best in U.S.’ for equipment financing for [PMAA Best In The US Logo] the third consecutive year.

“This honor is a great recognition of the customer focus provided by our team," said Patriot Capital President, Chris Santy. "We value our relationship with PMAA members and are appreciative of their awarding us this honor.”

PMAA is a federation of 46 state and regional trade associations representing more than 8,000 petroleum marketers nationwide.

Section 179 Can Save Small Businesses Thousands in Taxes

Every year, business owners reflect on the taxes they are paying. A recent Wall Street Journal article highlighted the average tax rate for larger U.S. corporations is 21 percent, noting “most mid-size and smaller firms pay much higher rates.”

One tax strategy that can be used to lower business taxes and improve cash flow is Section 179. This tax incentive enables those purchasing new or used capital equipment or making site improvements to capture benefits in the current tax year.

This is a true ‘small business’ tax incentive, applying to businesses with annual capital spending of less than $500,000. 

As an example, if a retailer used Section 179, a $500,000 spend could yield $175,000 in cash-flow benefit in the year the equipment was purchased. Combining this with equipment financing could create positive cash flow for almost 2 years. The first-year tax savings is $145,000 greater than what could be gained from standard equipment depreciation.

Read more about how to use Section 179 to decrease your tax bill here.

Four Ways to Protect Your Corporate ID

Americans are much more aware these days that it's important to protect their Social Security number to discourage identity theft, but many businesses aren't as vigilant when it comes to protecting their Employee Identification Number (EIN). An EIN functions like a Social Security number for a business and can be used to obtain credit.

Four ways businesses can protect their EIN include:

  • File the legal minimum amount of information when registering a corporation or LLC. Incorporation documents are available on many Secretary of State websites, so it's best not to disclose officers' names and contact information unless required to do so.
  • Verify your business information on the Secretary of State's website. Fraudsters can change business addresses and other information and potentially get loans or credit in the company's name.
  • Don't provide sensitive information on your website or other public places.
  • Check your credit report annually and follow up with credit bureaus on anything that seems out of place or incorrect.

For more information, please read the article by Casey Cox of Bernard Robinson & Company, LLP, CPAs in Greensboro, N.C., here.

Quick Meals Like Roasted Chicken Top the Five Significant Shopping Behaviors of Walmart Customers. Read more about Walmart customer behavior here.

What's the Future of Gas Sales in the U.S.?

If you’re thinking about buying new gas pumps or financing improvements to your site, you may be wondering what the outlook for  gasoline consumption in the U.S. is. PEI President, Rick Long shares his perspective on the expected impact of electric vehicles, ride sharing and car sharing on fuel sales in this editorial from PEI’s TulsaLetter.
In conversations with PEI members during the past few months, questions about electric vehicles (EVs), car-sharing and ride-sharing services continue to crop up. Part of the interest is just natural curiosity because these new transportation options are garnering so much media attention. But PEI members also are wondering what sort of impact each will have on the liquid fuel and fluid handling equipment industry.

In the near term, at least, the answer is “not much.” Read more on the future of fuel sales in the U.S. here.

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