How does a new business start up? | Business loan

What are the first steps when deciding to start your own business? The first questions you need to answer are what your business will be like, what sector it will develop in, what will make the product or service you offer unique. The possibilities are limitless and only you can answer correctly. Most people start their own businesses in an area where they have the experience, thinking that this is enough to succeed. But what matters is the potential of the market in which they want to develop. What would be the point of opening a pager repair service even if we were the best pager technicians after no one was using them anymore? Proper positioning and segmentation of the market by potential customers is the next important step. What does my average client look like? What are the consumer preferences that drive a purchase? How do I reach customers? More commentary at http://myopus.net/payday-loans-read-what-our-customers-say-about-our-online-loans-payday-loans/

A novice entrepreneur often asks himself the question and how to organize his business

A novice entrepreneur often asks himself the question and how to organize his business

What tips would you give?

Many specific questions arise here: Do I need a retail outlet or office? Or can I sell online and do business from home? Will it be rented or will I use my own room? Will I work alone or will I need staff? What raw materials and materials will I need? Which suppliers will I use? Will I be able to use a installment payment? Another important question is “What documents and permissions will I need”? Here it is necessary to decide whether the activity will be carried out through an existing company or if a new one will be registered. It is necessary to check what documents, permits, licenses and other documents will be required for the particular business.

Proper marketing of a product or service is crucial when starting a business. What are the main questions an entrepreneur needs to answer?

Very often, we think our product or service is unique. The truth is that there may be many competitors on the market that offer the same, similar product or complementary or replacement product that will directly or indirectly compete with our proposal. We need to be aware of what our product will be better or different from our competitors so that it is sought after or preferred over them. Logically, the next question comes: “How do I reach my customers and through what marketing mix?” We may offer the perfect product, but our customers may not suspect its existence.

It is extremely important how we inform our customers not only about the existence of our product, but also about its competitive advantages. The possibilities here are endless, everything is public these days, and we should not forget the endless possibilities of the Internet – nowadays, it is almost mandatory to have a website, especially if the product allows us to sell online and plan for it.

Many startup entrepreneurs are not experienced in developing a business plan

Many startup entrepreneurs are not experienced in developing a business plan

It is not necessary to have a complex business plan with multiple diagrams, tables, diagrams. But this should be the case with the smallest business. We need to be aware of what we are aiming for and what the steps are to achieve it. The business plan usually consists of two parts – marketing and financial. What budget will I need?

It is important to know that costs come in three types: start-up costs; fixed monthly expenses, which are not dependent on the volume of sales but are due every month and we have to secure their payment (rent, salaries, etc.); and direct costs, the volume of which depends on the volume of sales – these are the costs of production or delivery of the product / product. In making our estimates, we must include the initial costs and the costs of the initial recharging, provide funds for several months to cover the fixed costs, and subsequent recharges may be at the expense of future sales revenue.

It is good to develop three scenarios – pessimistic, realistic and optimistic. The pessimistic one is one in which the revenue will not be sufficient to generate profit. The key here is to calculate the so-called critical turnover, which covers all the necessary costs before making a profit. This is very important – we need to be aware of what are the minimum required revenues to judge if they are achievable. The second option is the realistic one – in this case, the really achievable revenues should be compared with the critical turnover.

If they are larger than this, then it will generate profits for the owner as well. If they are lower, it is not worth starting this business as soon as the bills indicate in advance that it will be a loser. The optimistic option is one in which the revenue exceeds the critical turnover significantly. In this case, each lev of additional gross profit is equivalent to net profit because we have already secured the expenses.

How do I get the funds I need? We have calculated how much money we will need (it is a good idea to bet on unforeseen expenses, there are always such). The next question is where to get them: the opportunities are many – personal resources, savings, assistance from relatives, the modern (most recently in the USA) – fundraising finances, through the raising of grants through internet based platforms. If you do not have any of these options, you can always contact a partner bank.

Partner Bank : This may be your current bank because it knows you best, but if it is not willing to fund your venture, you may want to target another one that is more flexible in financing a startup business. Banks are more cautious about lending to a new business because financial analysis is based on forecasted data, and they are not always realized. At the same time, the bank must have the assurance that the loan will be repaid.

That is why it is important not only to familiarize the bank with your business plan (this will show that you are aware of what you want to do and will justify the amount of the loan requested), but also have an alternative option for repaying the loan: this may be another Your income (salary, rent, other business), other income in your family, the income of a relative or friend, or your asset to secure the loan and, if necessary, to realize it to cover the debt. Most banks require self-involvement from the client and this is normal, the bank runs the risk of financing the project and it is important for it to know that the client is also engaged – this makes them partners.

When applying for a bank loan, we need to know some basic things about bank loans. They are mainly divided into turnover and investment . Turnover is for the purchase of goods, materials, raw materials, payment of running costs. Investment is for the purchase of equipment and furniture, for repair, for initial or one-time expenses. Turnover is shorter – they have the logic that the bank’s money should be “turned” through the company’s turnover and generate profit for the owner through the mark-up of the product – so it is considered that the loan principal is repaid by working capital, and interest from profit. Here you have to consider whether the profit generated by the trade mark-up will be higher or lower than the interest rate on the loan. If it is lower, it is worth considering whether the investment is worth it.

But if it is higher, it means that you will win by using the money of the bank. Investment loans are longer term because in them all the loan installment (both principal and interest) should be repaid with profit. The rule is: the amount of the contribution for a working loan can be up to 100% of the profit, and for an investment loan – up to 70% of it. When determining the term of an investment loan, not only the amount of the installment that can be repaid, but also the type of investment is taken into account. It is not good for an asset that will be used in business for 5 years to be purchased with a loan with a term of 10 years. Here, the advice of the bank’s credit experts can be very useful, and the credit products themselves are structured in compliance with the rules of prudent investment.

What products does offer for startup businesses?

startup businesses

We have many products that can be used by our customers both when starting a new business and expanding an existing one. It is important to note that we can lend to a business (existing or start-up), even if the customer does not meet all the conditions – if there is an eligible guarantor (co-debtor or guarantor) who can be an individual or company. Our loans have different conditions depending on the specific product or customer.

Basic parameters of lending to micro firms

  • for working loans:
    • size – unlimited, depends on the creditworthiness of the customer / guarantor and the security;
    • collateral – possibility for unsecured credit up to $ 30,000; for others: surety, pledge of tangible and intangible assets, mortgage of real estate; NGF, OGFMSP and Cosme program guarantee;
    • maximum term – 2 years for unsecured loans and 5 years for securing fixed assets / mortgage of real estate;
    • interest rate – 3.12% for a mortgage loan, 4.95% for a loan with a guarantor and 6.95% for a secured loan.
  • for investment loans:
    • size – no limit, depends on the purpose, creditworthiness of the customer / guarantor and the security;
    • collateral – possibility for unsecured credit up to $ 30,000; for others: surety, pledge of tangible and intangible assets, mortgage of real estate; NGF, OGFMSP and Cosme program guarantee;
    • maximum term of 7 years for unsecured loans, up to 10 years for loans with a pledge of FTA and up to 15 years for a mortgage on real estate;
    • min interest – 3.12% for a mortgage loan, 4.95% for a loan with a guarantor / FTA and 6.95% for a secured loan;
    • no requirement for self-participation, if the loan is with material collateral, 20% – for unsecured loans.

One of our favorite products, which continues to be our flagship product for 10 years, is Super Credit. With it, the loan can be in overdraft mode for the first 3 years without a plan for utilization and repayment. After that the client has the right to repay it partially or in full, without a fee for early repayment, and the outstanding part goes to the repayment plan. What makes the product so coveted by customers for financing their business is its extreme flexibility: in the early years, you use as much as you need and repay as much as you can, while paying only the interest on the used part.

The new Fine Bank Business Loan, part of the Fine Bank business program designed specifically for ladies with businesses, also offers many opportunities for women entrepreneurs to fund start-ups. Its successful start-up has shown that it is very suitable not only for financing an existing business but also for a startup. This is because of its special conditions, which allow for a longer term, lower cost of financing and more flexibility, which is welcome for any business, but especially for a startup.

Basic parameters of Fine Bank business loan:

Basic parameters of Smart Lady business loan:

  • size – no limit, depends on the purpose, creditworthiness of the customer / guarantor and the security;
  • collateral – possibility for unsecured credit up to $ 30,000; for others: surety, pledge of tangible and intangible assets, mortgage of real estate; NGF, OGFMSP and Cosme program guarantee;
  • maximum term: up to 180 months – for investment loans, up to 60 months – for current loans;
  • interest rate minus 2.72% for a mortgage loan, 4.25% for a loan with a guarantor / FTA and 6.25% for a secured loan;
  • special conditions and additional services:
      • the credit approval fee is payable upon approval ;
      • during the period of maternity and upbringing of a child up to 2 years of the lady – manager and / or owner of the company is allowed a grace period on the principal not more than 15 months. and the loan management fee is reduced by 50%;
      • free FiHealth Peace of mind insurance and FiHealth VIP Health Insurance VIP package ;
      • use of a daily banking business package at a 30% lower fee.