Before seeking funding, there are several things that I advise my clients to do in order to determine if their business idea is viable. These are important tips that should be used by all entrepreneurs – things lenders will look for when making a decision to approve funding or NOT! Here are 4 extremely important steps that all new entrepreneurs need to take before seeking funding!
Need a #SmallBusiness #Loan? Put Personal Finances in Order & seek resources as @SCOREMentors, @sbagov
[tweetthis]Need a #SmallBiz #Loan? Put Personal Finances in Order & seek resources as @SCOREMentors @sbagov[/tweetthis]
Prepare a Business Plan
A comprehensive business plan is imperative to your business success. It is needed to not only organize your business but to get a small business loan. Your business plan should be written early in the planning process and is your road map for starting and operating your small business. Because business plans can be daunting, you don’t have to do it alone. Here are some resources available to assist you:
- SCORE offers online business tools to assist you in business planning.
- SBA offers online business tools to help you start, grow and succeed.
- Business Plan Pro software is easy to use, affordable and loaded with hundreds of templates which guide you in writing your business plan.
Research and Know Your Competition
Understanding who your competitors are helps to project sales, avoid surprises, decrease reaction time as well as helps in understanding your own business (or proposed business) better. After your research information has been compiled and evaluated, it is important to develop strategies for competing, thus, determining if your if your idea is viable.
When you look at your competitors, you are analyzing:
- Who are your major competitors?
- What share of the market do they have?
- How do you compare to your competitors and how will they react to your entry into the market?
- What are their strengths and weaknesses (e.g. quality, price, service, payment terms, location, reputation, etc.)?
- What factors could increase or reduce your competition?
Analyze Your Market
The success of your business depends on making sales. Marketing is a way of communicating with your target market so they (customers) will buy your products and services. It is a necessary element of business. A constant marketing effort is required to establish, stabilize, and grow a successful business. Marketing & Sales practices include: describing your products and services clearly; continuously developing your understanding of your “marketplace”- who’s buying (customers), who’s selling (competition), what’s selling (products & services) at what price, how is the market changing; tracking the success of your marketing & sales strategy; improving your business’s ability to establish and maintain good prospect & customer relationships.
Put Personal Finances in Order
A prospective entrepreneur’s relationship with money and his/her ability to successfully manage personal finances and credit are directly connected to his/her success in the planning, decision-making, detailed oversight and big picture strategizing that are necessary to healthy business finance management. It can take time for a new business to develop a cash flow, so, making sure your personal finances are in order before launching your new business, is essential. Here are four quick tips to organize your personal finances:
- Pay off your credit card debt. Charge it! We are so used to whipping out the credit card and buying ‘things’ that we don’t need or can’t afford. Consider paying off your credit cards and consolidating balances to the credit card with the lowest APR. You will breathe a sigh of release once you realize you ‘CAN’ live without the dreaded plastic. And, you can thank me later!
- Invest wisely. Having an investment plan is the key to long term success. There are a lot of options out there, so I suggest you speak with a financial advisor.
- Save for an emergency. With the economy being so weak, sometimes it takes every penny that comes in to make ends meet. You must get out of that mind set and start saving on a regular basis. Start small and increase as time goes on.
- Create a personal budget. A personal budget is extremely important in managing your household. In fact, your monthly budget will help you in determining how much you will save and invest! An informative book that I’ve read and suggest is by author John L. Macko: Budget Yes! 21st Century Solutions for Taking Control of Your Money Now!’
By following these steps, you will position yourself for a successful funding request.
Sylvia Browder is CEO of Specialty Home Services LLC, a Home Improvement Company; a Small Business Consultant at Browder Consulting Group, a startup consultancy firm to help women with startup assistance, marketing, website and graphic design work and other support services. In addition, she has co-authored several published books; publisher of ‘Sylvia Browder’s Blog for Women Entrepreneurs’ a lifestyle blog; and publisher of ShopSpendBlack.com Business Directory & Blog platform created to help consumers find black owned businesses in a searchable format. In her spare time, she enjoys spending time with her husband of 30 years; 5 adult children and 5 grandchildren; church; friends and motorcycle riding.
These are great tips. Thank you for sharing them.
Hi there! It’s a boring day today at home and I have time to surf around. I was just searching around on Google and found your site. I love it, it’s informative and I enjoy the way you write your articles. Definitely a pleasant surprise and I’m happy Google directed me into your direction. Take Care!
Just had to take the two seconds to post a thank you. Read through your web site and really liked the information, bookmarked and I plan on returning soon!
Really great informative blog post here and I just wanted to comment & thank you for posting this. I’ve bookmarked youi blog and I’ll be back to read more in the future my friend! Also nice colors on the layout, it’s really easy on the eyes.
people were talking about this over at the digital site. it was beginning to develop into a heated battle.
Hey i just visited your site for the first time and i really liked it, i bookmarked it and will be back 😀
Hi John,
Thanks so much for taking time to read my article. I am so glad you found it resourceful!
Sylvia
This is just the detail I was trying to find. I wish I’d have discovered your website before.