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Thursday, November 30, 2023

Startup Guide for Any New Business

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Jesse Gee
Jesse Gee is an entrepreneur who has successfully built over a dozen businesses in the construction, finance, & insurance industries.

Are you planning to start a new business? Do you have a business plan? A business plan acts as the foundation of your business by providing guidance and management as you start your business. It will show you how to grow, structure, and run your business with the aim of generating maximum profits. In addition to this, it will help you keep your plan and life on track just in case you go through a mishap while starting the business and get discouraged. It could also help you get startup funding from investors, as it clearly shows your determination and confidence in the business. This read will help you format a business plan.

Two Approaches to Business Planning

There is no defined business plan format. You just have to make sure that it captures your needs and goals. There are two known business plan formats. They are:

  1. Traditional startup

This is the most common format. Some people consider it standard. It includes detailed explanations of each section in the plan. This means that it will probably take a lot of time and space to draft it. Investors and lenders mostly request this format.

  1. Lean startup

This format strictly summarizes the important parts of the business plan. This means that it does not need to the planner to spend a lot of time drafting it.

Format for a Business plan

It will take the following format.

  • Executive summary- Describe your company generally. This includes the mission statement, the service or product that you seek to offer your clients, basic info about your employees and staff, its location, and even financial information.
  • Description of the company- You should describe your company and the solution it seeks to solve for your clients. As you do this, make sure that you list and describe your consumers with respect to persons or companies that you are willing to cater to. Make sure you outline and boast about your strengths.
  • Market analysis- This area will help you have a better understanding of the market you seek to join. You will need to outline your competitors and their business strategies and products. Use this to outline some of the things you seek to approach differently.
  • Management and organization- this area deals with the structure of your company. Make sure you provide a detailed description of your legal and organizational structure. Provide details of the people in-charge, their experience, and their input to the business.
  • Product or service line- This area will require you to offer extensive detail on the service or product that you plan to offer your clients. This includes information on your intellectual property rights, among other things.
  • Sales and marketing- Provide detailed information on how you are planning to attract and maintain your customer base.
  • Funding- Just in case, the business plan seeks to invite investors, this area will help you to achieve that. Use this area to outline your requirements. It is advisable that you outline your funding needs for a period of five years minimum. Specify the reason behind your need for funds, inclusive of your debt payment strategy.
  • Financial projections- This area will help you convince your investors that your business plan and approach is stable. Make sure you include the following documents: cash flow statements, balance sheets, income statements, capital expenditure budgets, and an explanation on your projections.
  • Appendix- This area of the plan helps you to provide supporting materials and documents such as contracts, permits, legal documents, patents, permits, licenses, reference letters, pictures of the product, and even resumes.

Six Effective Strategies to Financing Your Business

After successfully developing your business idea, the first thing to do is to make sure that you have enough funds to finance your business. Finding adequate financing for startup capital, capital, or supplementary capital is quite challenging most business owners to manage. In order to help people secure enough funds to stabilize their business, this read will give you six finance strategies that will help you secure the bank.

Top Six Financing Strategies 

  1. Factoring method

This strategy is popular with companies and businesses that have poor credit. It entails selling discounted receivables for cash payments. It is popular with businesses that take orders before payment.

  1. Secure a loan from a bank

Most banks have strict regulations for borrows with respect to interest rates and payment dates. Thus if you choose to settle with this financing option, you have to compare bank regulations. Some banks actually have lifted some of their barriers to entry with respect to loans for businesses.

  1. Credit card

This is the riskiest method of business financing. This is because most people fail to use their cards appropriately leaving them with a lifetime of debts or a bad credit score. Therefore, if you opt for this option makes sure that you are disciplined enough to appropriately use the card.

  1. Tap into your retirement money

This financing method is also extremely risky. This means that you have to make sure that your business plan will be lucrative enough to prevent you from losing your retirement money. Tax law provisions will allow you to access your funds though it might take some time and the aid of a qualified individual. It is advisable that persons willing to use this option need to be one hundred percent sure about the returns of the business.

  1. Crowd funding

Technology has birthed so many ways of accruing resources and this is one of them. You will have to find a crowd-funding site. The most popular one is Kick-starter. It is a low-cost model of generating funds. It is similar to holding a fundraising event. However, it is not a long-term method for getting funds. It entails setting a time and fund limit by the business owner. For example, the business owner might decide to set a time limit of thirty days to raise funds amounting to three thousand dollars. After these limits are set, the business owner then seeks the aid of family, strangers, and friends to achieve this limit.

This means of financing is a means of supporting people with one-off ideas. The site offers lenders incentives to help the business owner, such as offering the lenders a book in exchange for a certain sum of money.  This is a very popular approach to money lending.

  1. Future pay

Are you willing enough to offer up your future pay to kick-start your business? You will need to go through your business plan and ascertain that your plan is legit enough to give you enough proceeds once it begins.

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