Starting a business Help!

  tein 17:25 31 May 2009

I've just come back from a informal meeting with my long time friend who is looking to open a shop in South Wales (Mumbles to be exact) it's such a lovely place & we are looking to sell unique clothing like skateboarding/surfboards & all that kind of stuff,
My friend has lived there for some years now & there is a few empty units/shops empty, Now we are very aware of the current economy situation but it's on the beach almost & we see a market for this area also the beach is a very busy place,

I'm 37 & he is 42 my friend has some very good contacts that can help us with a website/sponsors & using their name in advertising that relates to the type/nature of shop we would like to open, we are now at the stage where we are looking for funding.

I have looked at Business Link's website & they is a lot of companies offering help but many of them are to non-profit organisations & other fields different to ours & I see little in the way of financial help for the retail sector new businesses.? can anyone suggest a company or a link please.?

We have had this project on our minds for some time now but just recently looking to go ahead with it, today we disscussed many things which we both did meet in the middle with.

  wiz-king 17:51 31 May 2009

Create the company as a limited company, register it with companies house, get an accountant and bank account. Ask the local chamber of commerce, they can tell you of any grants available locally.
Look in the yellow pages for similar shops and then go and see how they look - are they busy or has trade gone flat? Dont forget that it can be a seasonal trade.

  birdface 17:59 31 May 2009

I think your Bank would be the obvious choice as long as you can put your house or something like that up as a guarantee of payment.
I would imagine that it would be extremely hard to get financial help from them just now.But you never know.
It is probably an excellent time to open up something like that with a lot of folk spending their holidays in the UK now.
But it does look like it will be seasonable with all of the work in the summer and quiet in the winter.
I wish you both the best of luck and hope that you get the financial backing that you need.

  QuizMan 18:21 31 May 2009

What a bank is prepared to do depends very much on how much you are able to invest yourselves, the strength of your business case and (depending on how much you wish to borrow, what security you have available.

Taking the first point for starters, no bank will put up 100% of the project costs. Ideally they are looking for 50/50 between your contribution and theirs. They are unwilling to take all the risk while you take most of the profits. That is even more relevant in the current climate.

Talking of profits, the next point is to get your business case, operating budget and cash flow forecast prepared. Depending on your own financial expertise, you may need help with this. You need a business case to set out what you are trying to achieve, how you are going to get there and the strengths and weaknesses of your aims. The operating budget will prove (hopefully) profitability and the cash flow forecast will confirm how much you need and how the business will generate funds to repay a lender.

Lastly there is security. If, as wiz-king suggests, you form a limited company, the bank will look for personal guarantees as a minimum plus other security to back up the guarantee. This is likely to be a first or second mortgage on property such as matrimonial home, if there is one, but it can be more liquid assets such as stocks and shares.

I hope that this helps. Good luck.

  GANDALF <|:-)> 18:35 31 May 2009

It may be a lovely place but for 5 months of the years there will be few visitors who will be your main market. Bear this in mind when forecasting cash flow.
Funding will be difficult in present times, more difficult than ever before and you will need a large deposit with financially strenuous guarantees. Also remember that more people may be spending holidays in the UK but take this with a pinch of salt...2 weeks in a half decent 2/3* hotel in The Lakes is incredibly expensive when compared to 2 weeks in a 4/5* hotel in Egypt. The reason people will holiday in the UK is because they are not wanting to spend too much theory. I would seriously think about 'putting up your house' as collateral. That flippant remark could be the most expensive you ever hear.


  Forum Editor 19:27 31 May 2009

for this kind of enquiry, and I'll transfer your thread there now.

  DieSse 19:28 31 May 2009

If you want any external help (and or course if you want to run your business well), you will need a business plan.

This sets out what you'll be doing and why you think it will make money - and will need to include estimated costs, income, and the trading terms you've negotiated with suppliers (as that will affect your cash-flow).

Cash-flow is as important as profit/loss - many profitable companies run out of cash to operate the business.

Banks etc will also want to know what capital you'll be putting into the business too. A friendly bank manager can be a great asset to you.

How to write a business plan click here lots of other such sites if you google.

Make sure it looks good and sounds reasonable and practical (not overly optimistic). Also have a plan for what you'll do if things don't go as well as you expect.

Look at what you might do on web sales too - and look at direct marketing to surfer clubs and associations.

  tein 19:37 31 May 2009

Thankx FE i wasnt aware there was this thread!

Thankyou members for ALL your help Thats been GREAT!!

Kindest Regards


  DieSse 19:46 31 May 2009

The first thing you will need if you approach any outside sources (and for your own benefit too!), is a Business Plan.

This will need to cover what you're planning to do, and how, and why you think it will work - plus a profit and loss forecast and a cash-flow forecast.

Here is a site which can help click here lots more of you google.

You'll need to specify how much money you will put into the business, how much you want to take out, what you estimate you can sell and why, the terms of business with your suppliers (which will affect your cash-flow), and so on.

Cash-flow is exceedingly important - many profitable businesses go under simply because their cash-flow is out of kilter. There's a big difference between profit and cash!

Negotiate hard with your suppliers to get discounts and good payment terms. The times are on your side.

Don't make your plans overly optimistic, and plan for what you'll do if you fall behind with them.

Look at all marketing opportunities - the shop - mail order - direct marketing to surfer clubs, the web, etc. Put together some special packages for them. Look at finding places for surfers to stay (for a commission, of course) which you can market along with goods. Look at marketing overseas too. In short look at any and all opportunities your basic business will open up.

Don't start up at the wrong time (ie after the start of the season) - otherwise your leanest times will be too soon.

  DieSse 19:50 31 May 2009

PS - try amd join any and all relevany business and trade associations, and get to use as many of their logos as you can, too.

And checkout the competition thoroughly.

  DieSse 19:51 31 May 2009

E.g. click here

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