123ArticleOnline Logo
Welcome to 123ArticleOnline.com!
ALL >> Investing---Finance >> View Article

Business Finance

Profile Picture
By Author: Carolyn Clayton
Total Articles: 174
Comment this article
Facebook ShareTwitter ShareGoogle+ ShareTwitter Share

So you want to start up a new business? You've done your research into the existing businesses and checked out your competition whilst gaining some hands on experience along the way. You're armed with your business plan, outlining your every move from your objectives, strategies, and target market to your financial forecast. There's just one little hurdle left to leap over, the decision and arrangement of business finance.

More and more businesses and new ventures are failing to get anywhere past the starting line. There are two main reasons why most businesses fail; poor management plans and inadequate business capital, which is why raising money is important in the early stages of a business.

So why is this need for finance so important? As a new business you will need not only a place for your business to be housed in but also all of the necessary equipment that will be needed to make sure your business is running to its fullest. This start up capital will be used to pay for:

The renting/buying of a premises/office space, which will require payment of three months in advance.
Any machinery or ...
... office equipment
Business services such as insurance
The purchase of stock
Wages and salaries
Any financial cover you may need while waiting for customers to use your business

In order to gain the correct business finance and to make sure that people will be willing to invest in your business it is essential to have a well structured and developed business plan. It should state how your business will be different from the competition, why people will use your business and how you will supply your customers with what they require. Research has been conducted that has found companies with a structured business plan stating their overall goals and how they plan to move their business towards them make a considerably higher profit than those that don't.

Most avenues that you chose to go down in order to secure business finance won't come near your business without this business plan. So what are your options when it comes to business finance? There are many options open to you but that doesn't mean that all of them are right for you.

One of the first places that people go to for business finance is there bank. Although banks are still the most common form of business finance it doesn't automatically mean they are the best. All banks vary in terms of what they can offer start-up businesses, so it is important to talk to a number of them before making a decision. Banks will also expect you to put some of your own money into the business; as a new business venture you may not be able to afford this.

Another form of business finance is asset financing. This is a line of credit that is secured by assets such as real estate. So as a new business venture you can use these assets as collateral to obtain capital. However if payments aren't made your assets may be seized.

An ever popular choice of Business Finance for a new business venture is a business angel. Business Angels are called this because they often save struggling firms with both finance and advice when no one else will. Angel investors understand the needs of a new business through there own experience and are able to advice and aid the companies in many ways. Business angels are successful entrepreneurs or executives. With their skill, luck, careful planning and good management; they have turned many businesses into profitable ones.

Finally there are venture capitalists who are private investors for financing new or growing businesses and even struggling established businesses. Even though they are high risk investments they can offer the potential for above average returns and/or a percentage of ownership of the company.

Total Views: 277Word Count: 631See All articles From Author

Add Comment

Investing / Finance Articles

1. Chart Patterns For Effective Intraday
Author: strike

2. Analysis Of Bank Statements: Essential For Banks And Nbfcs
Author: Aakash Parikh

3. Essential Tips For Buying Crypto Miners: Make Informed Decisions
Author: blockdag

4. Everything You Need To Know About Applying For A Swift Funds Loan
Author: Sofia Alice

5. Finding The Right Mortgage Broker In Abbotsford And Surrey, Bc
Author: Satbir Bhullar Mortgages

6. Jaydeep La Residency Thane Kolshet Road Project 2 & 3 Bhk Flats
Author: akhilagardas

7. Embracing Sustainable Investment With Esg Data & Solutions
Author: By Inrate Team

8. The Importance Of Lead Qualification In Solar Appointment Generation
Author: Shan Tait

9. Setting Up Your Company In Ireland: Key Considerations For Successful Formation
Author: LSC and Partners - Corporate Tax Consultancy LSC

10. Mortgage Lenders edmonton – How Are They Going To Help You
Author: Dominion Lending Centres Ratefair

11. Why Managing An Smsf In Perth Can Maximize Your Retirement Potential?
Author: Daniel Stewart

12. The Future Of Cryptocurrencies: A Look Ahead
Author: Ethan

13. Unlocking The Power Of Biodiversity In Data Solutions & Rating Services
Author: By Inrate Team

14. The Role Of Chartered Tax Advisors: Ensuring Compliance And Maximizing Benefits
Author: Business Tax & Money House

15. Innovative Accounting Solutions For Modern Businesses
Author: Business Tax & Money House

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: