When it comes to getting a startup off the ground, many will find that they will have some financial limitations and often look at companies such as Oink Money to help with funding. This is often the case, as many business ideas will have different avenues that need funding before a business can start trading.
To some, the lack of capital could mean that their business never sees the light of day. Fortunately, there are ways of obtaining capital, if you’re willing to carry out some research beforehand.
In most instances, a personal loan can help those who are yet to open their doors to customers, but it’s important to ascertain that you have looked at the costs relating to all aspects of your startup
Funding Your Startup
When starting a business, it’s easy to assume that you will need a business loan. While in some respects, this can be the case, but there are instances where a personal loan can be more viable.
A business loan can be difficult to attain if you’re not yet able to present anything but your best intentions. It can also be the case that a lender will only look to offer you loans of a certain amount, purely a business decision that yields the best results.
Opting for a personal loan in the early days will also mean that you’re not having to secure collateral or borrow more than you need to, making repayments and your financial situation as a whole much more manageable.
However, it shouldn’t be assumed that making repayments aren’t important, as falling behind can still have ramifications on your personal credit report.
Create a Business Plan
If you’ve never created a business plan before, then you could be forgiven for thinking that it’s some form of complex calculation, but it’s easier than you think. While a business plan isn’t required for a personal loan, it does serve as a guide should you stray off the beaten path when it comes to your business goals and finances, and ensure that a realistic backup plan is in place should the business not meet its goal at any point of a financial year.
Highlight What Your Company Offers
Although there are numerous companies offering a plethora of different services, the nature of a business normally boils down to supply and demands. What this means is that your startup will be offering a service that is appealing to a certain demographic.
Your business plan should include an overview of what your business offers and what kind of customer base you will be focusing on.
Research the Competition
As startups have become so popular, it should come as no surprise that many will start a business that offers a similar service to another. There’s certainly nothing wrong with some competition. If anything, it makes for a more active marketplace. However, it’s important that you acknowledge that there is competition out there, and it can be worth highlighting what your startup will do differently.
This can be as straightforward as acknowledging that some businesses may not offer the customer service buyers are looking for, so there could be potential for you to win over customers simply by ensuring that your customer service is polished and transparent.
While it may not seem like a big thing in the interim, it’s the smaller details that matter to some prospective customers, so you could find that your method of working helps you win over customers that may have been let down elsewhere.
How Much Do You Need?
It can be tempting to borrow more than we need, but this can be a grave error, especially when contending with a startup. To work out how much you need to borrow, you will need to look at the capital you already have, and make some cost-effective decisions in relation to the business. This will ensure that you are more likely to be improved, and be able to pay off the loan much sooner.
How Much Profit Will You Make?
Those who in the process of getting a new business up and running will often be perplexed as to how with questions that ask what their company will be making in the next 12 months, but it’s certainly something worth considering, especially when looking for capital.
Of course, you will never be able to predict profits to the penny, but it can be worthwhile thinking of your marketing, and how you plan to win over new business. Once you have an estimate of how much you think your startup will make each month, these should be detailed within the business plan.
Not only does this help with your company finances, but it also allows you to plan for business expansion in the future should the need arise.
Has You Startup Planned for Financial Shortfalls
Once you have determined how much you think your startup will make in its initial stages, there can be occurrences that mean that your business may not meet its occurrences. Depending on what sector your business operates in. this could be anything from the weather, to an unprofessional third-party.
Of course, this can be frustrating, but there always pros and cons in the world of business, and learning to roll with the punches allows us to adapt to the business world and become more educated as a result.
For each plan you have, you should try where possible to come up with some form of contingency plan. For example, if you’re using advertising that you’ve never used before, then it can be unwise to place all your eggs in one basket and commit for a year of the advertising in question isn’t giving you the conversion you’re looking for.
Nobody can get it right all the time, but having a backup should anything go in the wrong direction means that we have some financial foundation to fall back on should a month not go to plan.
While it’s not always possible, having a contingency plan in place will ensure that your business is moving in the right direction, as well as ensuring that you’re able to commit to loan repayments comfortably.