Starting your own local business can be a scary and frightful step you take in your career. Definitely is a major change in life and financial situations. Some are lucky to be well off in life to support this move but for those of us that aren’t, just take into account that its not just about the cost of the bsuiness. Its about having enough cash flow to support the business during its initial phases of start up and using some money to live, and grow the business as well.
Starting and setting up a business is no easy task, there are many costs to take into account hence you need some cash flow at the early stages to support some of the below:
1. Costs of rental space if this is a retail business. You would need to take into account at least 6 month of rental money on the side inorder to survive while the business picks up.
2. Costs of staff including your living expenses for the next 6 months.
3. Cost of goods and services until the business becomes self sufficient.
4. Costs of renovations if any in the store and unexpected expenses.
5. If this is not a retail business, then you need money for advertising as it became a necessity nowadays since word of mouth is not enough.
Here some steps to take in order to be able to get some funding in the initial stages of your start up:
1. Come up with a smart business plan for business bank loan or government business loan
2. Bring in silent investors in the business in case the business loan does not get invested. True that you will have to share profits, yet you need to accept that idea that help will be needed and is not an option. These investors can be family and friends.
3. If you have the luxury of working while starting your business, that would be the safest and most reliable mode of safety and funding for your business.
4. Possibility of bringing in investors that will work as well in the business hence saving labor costs.
5. Proposing the business to investors in different countries and venture capitalist firms.
6. I do not particularly like that idea so much but it could be used as a last resort. Take out a personal loan for the business or mortgage if you believe in it and want to take a chance. When taking out personal loans, be aware that personal assets are at risk. In additional credit cards are also an option in this though the interest rates are usually high and should not be used for long term financing.
7. Cash in some of your retirement 401/RRSP money that you have saved up for. That could be worth the risk and is money that can be used to follow your dream.
Check some insight on owning and leasing a limousine and what to look out for when owning businesses. Many people that choose to take the route of going on their own and opening a business, end up being extremely happy and find their path eventually. Yes there are some that fail, however, how would you feel if you were old one day and you look back and regret never giving this a chance. Will yo be ok living with that regret?
For most of the working people, having their own business is just a dream and never materializes. For those that do go the extra mile, the adventurous ones, the risk takers and the passionate ones, all i can say is that is never came easy to any successful person, not to Will Smith, not to Steve Jobs and not to most achievers!