by: scott morris
Are you planning to start a new business? Or are you considering expanding your current business and require a bank loan or investment from outsiders?
If you are going to look for an investment of capital it is quite likely that you will be required to have a business plan. If you are starting a business, despite the work involved, a business plan can prepare you for the obstacles ahead and help ensure your success.
A business plan is something that many small businesses fail to create, however, many business owners are adamant that having a written business plan is one of the keys to their present success. Creating a business plan forces you to contemplate possible obstacles to your business and prepares you to find solutions that will help you to overcome them.
To find investors or get a bank loan, they will want to see that you have the experience or resources to run the business. They will want to see your projected income as well as your suggested repayment plan already laid out. Taking the time to do this is not only important for them, but it gives you a measuring tool to verify if your business is growing properly. You can gage your success on how close to the plan your business has actually performed. Perhaps you'll do worse, or perhaps you'll do better, either way it helps you determine how well your business is getting on.
If you have never seen a business plan before you may be concerned that is is too difficult a proposition for you to manage on your own.
While there are services available where you can hire someone to write a business plan for you, depending on your needs it may be wise to familiarize yourself with a business plan's layout. This will not only help you to provide the necessary information, but may encourage you to try your own hand at it.
There's a free tool at www.bdc.ca which will assist you in creating a business plan. Some of the topics you will be required to explain are your Market, Customer, Competition, Marketing Plan, Research & Development along with financial forecasts. You may consider hiring someone to help you with your financial sheets after completing the written part of the Business Plan.
Your Business Plan will become your guide and silent business partner - indicating where you need to improve and helping you stay one step ahead of your competition. Make it a priority to have this crucial road map for your business.
About the author:
Morris manages a book on planning financial planning consultant.
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Saturday, May 30, 2009
Developing Realistic Financial Assumptions in Your Business Plan
by: Dave Lavinsky
Many investors skip straight to the financial section of the business plan. It is critical that the assumptions and projections in this section be realistic. Plans that show penetration, operating margin and revenues per employee figures that are poorly reasoned, internally inconsistent or simply unrealistic greatly damage the credibility of the entire business plan. In contrast, sober, well-reasoned financial assumptions and projections communicate operational maturity and credibility.
For instance, if the company is categorized as a networking infrastructure firm, and the business plan projects 80% operating margins, investors will raise a red flag. This is because investors can readily access the operating margins of publicly-traded networking infrastructure firms and find that none have operating margins this high.
As much as possible, the financial assumptions should be based on actual results from your or other firms. As the example above indicates, it is fairly easy to look at a public company’s operating margins and use these margins to approximate your own. Likewise, the business plan should base revenue growth on other firms. Many firms find this impossible, since they believe they have a break-through product in their market, and no other company compares. In such a case, base revenue growth on companies in other industries that have had break-through products. If you expect to grow even faster than they did (maybe because of new technologies that those firms weren’t able to employ), you can include more aggressive assumptions in your business plan as long as you explain them in the text.
The financials can either enhance or significantly harm your business plan’s chances of assisting you in the capital-raising process. By doing the research to develop realistic assumptions, based on actual results of your or other companies, the financials can bolster your firm’s chances of winning investors. As importantly, the more realistic financials will also provide a better roadmap for your company’s success.
About the author:
GT Business Plans has developed over 200 business plans for clients that have collectively raised over $750 million in financing, launched numerous new product and service lines and gained competitive advantage and market share. GT Business Plans is the sister site of GT Venture Capital
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Many investors skip straight to the financial section of the business plan. It is critical that the assumptions and projections in this section be realistic. Plans that show penetration, operating margin and revenues per employee figures that are poorly reasoned, internally inconsistent or simply unrealistic greatly damage the credibility of the entire business plan. In contrast, sober, well-reasoned financial assumptions and projections communicate operational maturity and credibility.
For instance, if the company is categorized as a networking infrastructure firm, and the business plan projects 80% operating margins, investors will raise a red flag. This is because investors can readily access the operating margins of publicly-traded networking infrastructure firms and find that none have operating margins this high.
As much as possible, the financial assumptions should be based on actual results from your or other firms. As the example above indicates, it is fairly easy to look at a public company’s operating margins and use these margins to approximate your own. Likewise, the business plan should base revenue growth on other firms. Many firms find this impossible, since they believe they have a break-through product in their market, and no other company compares. In such a case, base revenue growth on companies in other industries that have had break-through products. If you expect to grow even faster than they did (maybe because of new technologies that those firms weren’t able to employ), you can include more aggressive assumptions in your business plan as long as you explain them in the text.
The financials can either enhance or significantly harm your business plan’s chances of assisting you in the capital-raising process. By doing the research to develop realistic assumptions, based on actual results of your or other companies, the financials can bolster your firm’s chances of winning investors. As importantly, the more realistic financials will also provide a better roadmap for your company’s success.
About the author:
GT Business Plans has developed over 200 business plans for clients that have collectively raised over $750 million in financing, launched numerous new product and service lines and gained competitive advantage and market share. GT Business Plans is the sister site of GT Venture Capital
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When Do I Need To Hire A Business Plan Consultant
by: Howard Schwartz
Every new business owner knows that a business plan is critical – it is drilled into them by potential investors and every banking officer they meet. So why is something that is so important to the launch of a new venture so difficult to write? Good question! In this article I will try to address when you should go out and hire a business plan writer versus taking on the task yourself. First time entrepreneurs often cringe when sitting down to write their business plan. Some spend 6 months agonizing over each period and comma, and even worse others spend 6 months procrastinating and do nothing. So lets break it down and see where / when a business planning company should be brought in:
Who will read your business plan and why?
First you need to really understand the purpose of your business plan and who your audience (reader) will be. This is an important point as a business plan being written for a $100,000 loan is VERY different than a document needed for a $10 million round of venture capital! Since this article is focused on first-time small business owners, I will focus on preparing business plans raising less then $1 million in capital. For this “startup” or “seed” business plan 30-35 pages are perfect. You are not expected to deliver a thick book (and no one will read it anyway!). Once you have this down, you can honestly assess which sections you are qualified / comfortable writing and which may need consulting help.
Here is what you should write on your own
It is important for you to write a basic draft / outline of your business plan. Without this direction you are probably asking too much of your consultant. Once you have your thoughts organized on paper you can see what you are comfortable completing. Here are a few suggestions:
Executive Summary: Draft the opening of your business plan – then hire a pro to come in and re-write it. Your executive summary will be read first and first impressions are critical!
Marketing: You need to write your own definition of your target customer / audience. For the market research on industry growth and fancy charts go ahead and hire a consultant.
Competitive Analysis: You should put together the first draft of this section, as it is almost as important to understand your competitors, as it is your customers. If you find a consultant that is an expert in your field, then you can work together and add to your initial list.
The Dreaded Financials
This is the most difficult part of a startup business plan, as you are making projections and assumptions on products / services that you have not even produced or sold yet! If you are stuck on this section you can hire a business plan consultant to just assist you with completing your projections (income statement, cash flow, and balance sheet). Figuring out the cost of goods, delivery costs, and return rates can be simplified by breaking them down into a “light” spreadsheet. Next you need to understand your startup and operating costs – items like electricity, travel, phone expenses, etc. Again just organize these and your consultant can make all the fancy charts and graphs. Just make sure you understand all of the assumptions – for example if you are opening a retail business, you should not look towards your consultant to “guess” your rent – go out and meet with a realtor and come back with real data. If you work closely with your consultant, the financials are a great section to bring in professional help.
Managing Expectations
Now that you know a bit more about when to hire a business plan writer you also need to manage your expectations. You can’t expect a $1,000 business plan to have 20 pages of competitive analysis and a full-blown marketing strategy! If you carefully work through which sections of your business plan need outside help and then manage your consultant closely, your final document will be a success! My next two articles will focus on “How to Find / Hire a Business Plan Consultant” and more importantly “When to Fire your Business Plan Consultant!”
About the author:
Howard Schwartz is a partner in several business strategy groups, including HJ Ventures International, Inc. Howard has worked with hundreds of entrepreneurs worldwide with a focus on writing business plans for companies interested in raising capital from Venture Funds and Angel Investors. Howard’s business plans have secured several million dollars in funding.
For more information: http://www.hjventures.com
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Every new business owner knows that a business plan is critical – it is drilled into them by potential investors and every banking officer they meet. So why is something that is so important to the launch of a new venture so difficult to write? Good question! In this article I will try to address when you should go out and hire a business plan writer versus taking on the task yourself. First time entrepreneurs often cringe when sitting down to write their business plan. Some spend 6 months agonizing over each period and comma, and even worse others spend 6 months procrastinating and do nothing. So lets break it down and see where / when a business planning company should be brought in:
Who will read your business plan and why?
First you need to really understand the purpose of your business plan and who your audience (reader) will be. This is an important point as a business plan being written for a $100,000 loan is VERY different than a document needed for a $10 million round of venture capital! Since this article is focused on first-time small business owners, I will focus on preparing business plans raising less then $1 million in capital. For this “startup” or “seed” business plan 30-35 pages are perfect. You are not expected to deliver a thick book (and no one will read it anyway!). Once you have this down, you can honestly assess which sections you are qualified / comfortable writing and which may need consulting help.
Here is what you should write on your own
It is important for you to write a basic draft / outline of your business plan. Without this direction you are probably asking too much of your consultant. Once you have your thoughts organized on paper you can see what you are comfortable completing. Here are a few suggestions:
Executive Summary: Draft the opening of your business plan – then hire a pro to come in and re-write it. Your executive summary will be read first and first impressions are critical!
Marketing: You need to write your own definition of your target customer / audience. For the market research on industry growth and fancy charts go ahead and hire a consultant.
Competitive Analysis: You should put together the first draft of this section, as it is almost as important to understand your competitors, as it is your customers. If you find a consultant that is an expert in your field, then you can work together and add to your initial list.
The Dreaded Financials
This is the most difficult part of a startup business plan, as you are making projections and assumptions on products / services that you have not even produced or sold yet! If you are stuck on this section you can hire a business plan consultant to just assist you with completing your projections (income statement, cash flow, and balance sheet). Figuring out the cost of goods, delivery costs, and return rates can be simplified by breaking them down into a “light” spreadsheet. Next you need to understand your startup and operating costs – items like electricity, travel, phone expenses, etc. Again just organize these and your consultant can make all the fancy charts and graphs. Just make sure you understand all of the assumptions – for example if you are opening a retail business, you should not look towards your consultant to “guess” your rent – go out and meet with a realtor and come back with real data. If you work closely with your consultant, the financials are a great section to bring in professional help.
Managing Expectations
Now that you know a bit more about when to hire a business plan writer you also need to manage your expectations. You can’t expect a $1,000 business plan to have 20 pages of competitive analysis and a full-blown marketing strategy! If you carefully work through which sections of your business plan need outside help and then manage your consultant closely, your final document will be a success! My next two articles will focus on “How to Find / Hire a Business Plan Consultant” and more importantly “When to Fire your Business Plan Consultant!”
About the author:
Howard Schwartz is a partner in several business strategy groups, including HJ Ventures International, Inc. Howard has worked with hundreds of entrepreneurs worldwide with a focus on writing business plans for companies interested in raising capital from Venture Funds and Angel Investors. Howard’s business plans have secured several million dollars in funding.
For more information: http://www.hjventures.com
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Realism vs. Optimism in the Business Plan
by: Dave Lavinsky
The most important function of a business plan is to create interest among investors so that they write a check. In achieving this goal, business plan writers are often challenged by determining the proper level of optimism in their plan. That is, they must create a compelling story to investors while maintaining credibility.
Optimism shows investors that a company is confident about the market opportunity, its ability to execute on the opportunity, etc. Over-optimism, however, leads investors to believe that the management team does not fully understand the opportunity or the tough road ahead. As such, business plans must be sure to limit over-optimism and show investors they are realistic and credible.
Realism, the opposite of over-optimism, should be used in business plans to portray sobriety and credibility to investors. Realism should manifest itself in management team bios that tell the actual accomplishments of managers, rather than fluff. It should manifest itself in credible market forecasts and sober assumptions of the company’s growth.
While business plans must excite investors so they take action, if they are too optimistic, investors will discount their merit. Conversely, if they are too sober, investors may not feel they will get an adequate return on their investment. As such, business plans should present a compelling, optimistic picture, but continuously refer to hard facts and realistic assumptions to build credibility and genuine excitement
About the author:
GT Business Plans has developed over 200 business plans for clients that have collectively raised over $750 million in financing, launched numerous new product and service lines and gained competitive advantage and market share. GT Business Plans is the sister site of GT Venture Capital
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The most important function of a business plan is to create interest among investors so that they write a check. In achieving this goal, business plan writers are often challenged by determining the proper level of optimism in their plan. That is, they must create a compelling story to investors while maintaining credibility.
Optimism shows investors that a company is confident about the market opportunity, its ability to execute on the opportunity, etc. Over-optimism, however, leads investors to believe that the management team does not fully understand the opportunity or the tough road ahead. As such, business plans must be sure to limit over-optimism and show investors they are realistic and credible.
Realism, the opposite of over-optimism, should be used in business plans to portray sobriety and credibility to investors. Realism should manifest itself in management team bios that tell the actual accomplishments of managers, rather than fluff. It should manifest itself in credible market forecasts and sober assumptions of the company’s growth.
While business plans must excite investors so they take action, if they are too optimistic, investors will discount their merit. Conversely, if they are too sober, investors may not feel they will get an adequate return on their investment. As such, business plans should present a compelling, optimistic picture, but continuously refer to hard facts and realistic assumptions to build credibility and genuine excitement
About the author:
GT Business Plans has developed over 200 business plans for clients that have collectively raised over $750 million in financing, launched numerous new product and service lines and gained competitive advantage and market share. GT Business Plans is the sister site of GT Venture Capital
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Business Plan
by: Greg
A is a short brief that explains how a business owner, director or entrepreneur plans to orchestrate an enterprising effort that carries out the actions that are necessary in order for the effort to succeed. Basically, a business plan is the written description of a business’s business model. Those involved in the planning process and management are the most likely to use a business plan. Business plans are also used when approaching potential lenders or investors that have an interest in a particular business venture.
There is a great deal of subject matter that is addressed in a business plan including a number of sub-plans. There are a number of business plan models that can be used to create a new business plan from or there are software options like the Business Plan Pro 2004. If a business is not using a business plan software program, they will most likely follow what is considered to be a typical business plan format.
About the author:
Business Plan
A business plan is a short brief that explains how a business owner, director or entrepreneur plans to orchestrate an enterprising effort that carries out the actions that are necessary in order for the effort to succeed. Basically, a business plan is the written description of a business’s business model. Those involved in the planning process and management are the most likely to use a business plan. Business plans are also used when approaching potential lenders or investors that have an interest in a particular business venture.
There is a great deal of subject matter that is addressed in a business plan including a number of sub-plans. There are a number of business plan models that can be used to create a new business plan from or there are software options like the Business Plan Pro 2004. If a business is not using a business plan software program, they will most likely follow what is considered to be a typical business plan format.
Most business plans will begin with an executive summary that describes the basics of the business model as well as comprehensive explanations for the scheme of the plan. Next, the business plan will move into the background of the plan with a brief history of the company especially if it a newer company and background information that includes how long the company has been in business, the current number of employees, annual sales figures, the location of all the business’s facilities and a complete description of the business ownership.
Next, most business plans will detail what will be involved in their marketing efforts including the competitive environment, customer priorities, product, pricing and promotion strategies as well as the distribution strategy. The explanation of production and manufacturing should include all work procedures as well as production facility requirements, inventory requirements, equipment needs and fixed cost apportioning. Finance details the source of all funds, anticipated returns, a formal monthly cash flow statement and a list of all existing loans and liabilities. Human resources points out where responsibilities are assigned, training that will be required, necessary skills, union issues, salaries and new hiring information. Other areas that may need to be covered depending on each individual situation can include legal strategies, product research and development, marketing research and any inter-company workings.
For those who feel that they cannot complete a business plan on their own or simply don’t have the time that is needed to put together an effective business plan, there are some software options like the Business Plan Pro 2004. The Business Plan Pro creates a complete and professional looking business plan that is sure to clarify the workings of a business and impress those who see it for understanding and funding purposes. The Business Plan Pro 2004 provides preformatted tables, color charts and graphs, graphic forecaster, built-in formatting, Power Point templates and a great deal more. By using software like the Business Plan Pro 2004, the user is guaranteed to have an impressive and professional looking business plan to present to people of import.
About The Author
Greg is the webmaster and owner of " Best-Business-Plan-Tips.com" and has been researching and reporting on Business Planning for years. Click Here ==> http://www.best-business-plan-tips.com/
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A is a short brief that explains how a business owner, director or entrepreneur plans to orchestrate an enterprising effort that carries out the actions that are necessary in order for the effort to succeed. Basically, a business plan is the written description of a business’s business model. Those involved in the planning process and management are the most likely to use a business plan. Business plans are also used when approaching potential lenders or investors that have an interest in a particular business venture.
There is a great deal of subject matter that is addressed in a business plan including a number of sub-plans. There are a number of business plan models that can be used to create a new business plan from or there are software options like the Business Plan Pro 2004. If a business is not using a business plan software program, they will most likely follow what is considered to be a typical business plan format.
About the author:
Business Plan
A business plan is a short brief that explains how a business owner, director or entrepreneur plans to orchestrate an enterprising effort that carries out the actions that are necessary in order for the effort to succeed. Basically, a business plan is the written description of a business’s business model. Those involved in the planning process and management are the most likely to use a business plan. Business plans are also used when approaching potential lenders or investors that have an interest in a particular business venture.
There is a great deal of subject matter that is addressed in a business plan including a number of sub-plans. There are a number of business plan models that can be used to create a new business plan from or there are software options like the Business Plan Pro 2004. If a business is not using a business plan software program, they will most likely follow what is considered to be a typical business plan format.
Most business plans will begin with an executive summary that describes the basics of the business model as well as comprehensive explanations for the scheme of the plan. Next, the business plan will move into the background of the plan with a brief history of the company especially if it a newer company and background information that includes how long the company has been in business, the current number of employees, annual sales figures, the location of all the business’s facilities and a complete description of the business ownership.
Next, most business plans will detail what will be involved in their marketing efforts including the competitive environment, customer priorities, product, pricing and promotion strategies as well as the distribution strategy. The explanation of production and manufacturing should include all work procedures as well as production facility requirements, inventory requirements, equipment needs and fixed cost apportioning. Finance details the source of all funds, anticipated returns, a formal monthly cash flow statement and a list of all existing loans and liabilities. Human resources points out where responsibilities are assigned, training that will be required, necessary skills, union issues, salaries and new hiring information. Other areas that may need to be covered depending on each individual situation can include legal strategies, product research and development, marketing research and any inter-company workings.
For those who feel that they cannot complete a business plan on their own or simply don’t have the time that is needed to put together an effective business plan, there are some software options like the Business Plan Pro 2004. The Business Plan Pro creates a complete and professional looking business plan that is sure to clarify the workings of a business and impress those who see it for understanding and funding purposes. The Business Plan Pro 2004 provides preformatted tables, color charts and graphs, graphic forecaster, built-in formatting, Power Point templates and a great deal more. By using software like the Business Plan Pro 2004, the user is guaranteed to have an impressive and professional looking business plan to present to people of import.
About The Author
Greg is the webmaster and owner of " Best-Business-Plan-Tips.com" and has been researching and reporting on Business Planning for years. Click Here ==> http://www.best-business-plan-tips.com/
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Business Plans - What Do They Include?
by: Kevin Erickson
Ok... so you've finally reached that stage in the development of your home business to get started. You've done the research, you have a game plan and you're ready to go except for one small detail... you need money. Whether it comes from a loan or from investors it doesn't matter but you need a good dose of seed money to put all your hard work and planning into action. However, regardless of who hears your money pitch before they give you a dime they will want see your business plan.
Business Plan - What Is It?
A good way to think of a business plan is that's it's a document that provide answers to the type of questions anyone who may provide financing would like to know about your home business. You will not get outside funding without one, because the people giving you the funding will insist on one because it helps them to know that you’ve thought through what you’re proposing to do. A business plan says to them... "I’ve considered this from every angle, and here’s what I’ve come up with".
Business Plan - What Does It Include?
What is your product or service? This is the first question every business plan should answer. You must explain in the clear, concise language what in the world you plan to produce or what service you plan to provide. You will also want to include why you've chosen this particular product or service.
Who are Your Customers? After you've explained your product or service, the next step is to identify who you plan to sell your product or service too and why. The demographics (age, sex, language, country, state or city, income, etc.) You need to clearly identify your customers in order to properly target your advertising, packaging, pricing, et.
What Makes You Different? You need to identify the "primary factors" that will make your business different than other businesses you'll be competing with. What niche are you filling that they are not or what do you plan to do to fill a particular void in the market that you've identified?
What are Your Expenses? Your start-up expenses include any equipment that you need before you can get up-and-running, while your day-to-day expenses are staff costs and supplies.
Following is a Simplified Example of Business Plan
This a a simplified and shortened version of a business plan. In the real world... each one of the following sections would be 1 - 2 pages in length. That being said... in most instances it's better to be as brief as possible. Only add information if your potential backers request it. It's a bad idea to go into too much detail in your plan. You’re not trying to explain everything down to the nth detail, just the basics of the business and why they should give you the money you need to launch it. And always focus on profit.
Catering Plus
Nature of Business: The business will be a home-based catering company, producing luxury food for special occasions such as birthdays and weddings. We will provide a comprehensive catering service, while specializing in high end customized cakes, which have a higher profit margin than other foods.
Target Market: Our catering business will be aimed at middle-class customers who desire a top-of-the-line catering but must operate on a budget. Our initial market area will consist of Mytown and the affluent area of Theretown.
Key Factors: We will only use commerical grade ingredients purchased from wholesalers and provide top quality design and service. This will allow us to provide food that looks tastes great, while keeping costs as low as possible.
Expenses: Beause I will be using my kitchen and making the food myself, there are only two real expenses: The purchase of an industrial grade mixer and then the day-to-day cost of supplies. I've attached a suppliers’ letter listing prices. Our research has shown that this supplier offers the best value for start-ups.
To wrap it up, you should include a breakdown of both projected profit and loss per month (in graph form)for the first year in business. Show one-time and day-to-day expenses versus projected profit to indicate how you will pay-off your loan. Your business plan should show you making enough of a profit each month to live on – if it doesn’t, then it may be considered unfeasible.
Study a Few Real-World Business Plans
The best way to get a real a feel for the dos and do nots of a business plans is to find real-world plans that have already been approved and study them. A good place to start is the internet. Once you’ve studied a few, you will get a better feel for how much work will be involved in putting your business plan together. Remember, until your business exists for real, the business plan is the only tool you have to sell prospective backers on how great your business is going to be
Ok... so you've finally reached that stage in the development of your home business to get started. You've done the research, you have a game plan and you're ready to go except for one small detail... you need money. Whether it comes from a loan or from investors it doesn't matter but you need a good dose of seed money to put all your hard work and planning into action. However, regardless of who hears your money pitch before they give you a dime they will want see your business plan.
Business Plan - What Is It?
A good way to think of a business plan is that's it's a document that provide answers to the type of questions anyone who may provide financing would like to know about your home business. You will not get outside funding without one, because the people giving you the funding will insist on one because it helps them to know that you’ve thought through what you’re proposing to do. A business plan says to them... "I’ve considered this from every angle, and here’s what I’ve come up with".
Business Plan - What Does It Include?
What is your product or service? This is the first question every business plan should answer. You must explain in the clear, concise language what in the world you plan to produce or what service you plan to provide. You will also want to include why you've chosen this particular product or service.
Who are Your Customers? After you've explained your product or service, the next step is to identify who you plan to sell your product or service too and why. The demographics (age, sex, language, country, state or city, income, etc.) You need to clearly identify your customers in order to properly target your advertising, packaging, pricing, et.
What Makes You Different? You need to identify the "primary factors" that will make your business different than other businesses you'll be competing with. What niche are you filling that they are not or what do you plan to do to fill a particular void in the market that you've identified?
What are Your Expenses? Your start-up expenses include any equipment that you need before you can get up-and-running, while your day-to-day expenses are staff costs and supplies.
Following is a Simplified Example of Business Plan
This a a simplified and shortened version of a business plan. In the real world... each one of the following sections would be 1 - 2 pages in length. That being said... in most instances it's better to be as brief as possible. Only add information if your potential backers request it. It's a bad idea to go into too much detail in your plan. You’re not trying to explain everything down to the nth detail, just the basics of the business and why they should give you the money you need to launch it. And always focus on profit.
Catering Plus
Nature of Business: The business will be a home-based catering company, producing luxury food for special occasions such as birthdays and weddings. We will provide a comprehensive catering service, while specializing in high end customized cakes, which have a higher profit margin than other foods.
Target Market: Our catering business will be aimed at middle-class customers who desire a top-of-the-line catering but must operate on a budget. Our initial market area will consist of Mytown and the affluent area of Theretown.
Key Factors: We will only use commerical grade ingredients purchased from wholesalers and provide top quality design and service. This will allow us to provide food that looks tastes great, while keeping costs as low as possible.
Expenses: Beause I will be using my kitchen and making the food myself, there are only two real expenses: The purchase of an industrial grade mixer and then the day-to-day cost of supplies. I've attached a suppliers’ letter listing prices. Our research has shown that this supplier offers the best value for start-ups.
To wrap it up, you should include a breakdown of both projected profit and loss per month (in graph form)for the first year in business. Show one-time and day-to-day expenses versus projected profit to indicate how you will pay-off your loan. Your business plan should show you making enough of a profit each month to live on – if it doesn’t, then it may be considered unfeasible.
Study a Few Real-World Business Plans
The best way to get a real a feel for the dos and do nots of a business plans is to find real-world plans that have already been approved and study them. A good place to start is the internet. Once you’ve studied a few, you will get a better feel for how much work will be involved in putting your business plan together. Remember, until your business exists for real, the business plan is the only tool you have to sell prospective backers on how great your business is going to be
Alternative Venture Finance: Federal Grants and Loans
by: Dave Lavinsky
While most companies seeking venture capital initially think about angel investors and venture capitalists, a large alternative source of financing is federal grants and loans. The two largest federal grant programs are run by the Small Business Administration (SBA), and by Small Business Investment Companies (SBICs).
An SBA loan, regardless of whether it is a direct loan from the SBA, or, as is more common, a bank loan guaranteed by the SBA, is essentially a bank loan. The benefit of it versus a traditional bank loan is the rate. SBA rates are typically much less than traditional business loan rates.
In most cases, in a guaranteed SBA bank loan, the SBA guarantees 90 percent of the loan will be repaid to the bank. As such, banks are at much less risk than in most other loans, and are a bit more flexible with regards to who they offer these loans. However, the SBA usually requires the founders of the company to personally guarantee the loans, which makes them risky should the venture collapse.
Alternatively, Small Business Investment Companies (SBICs) are privately organized corporations that are licensed and regulated by the SBA. Small or emerging businesses which qualify for assistance from the SBIC program can receive equity capital and/or long-term loans from these companies. Essentially, these companies provide their own capital, which is supplemented by federal funds, to the companies they fund.
Interestingly, U.S. taxpayers benefits from the SBIC program as tax revenues generated from successful SBIC investments have more than covered the cost of the program. Likewise the program has created hundreds of thousands of jobs.
In summary, SBA and SBIC financing are viable alternatives to financing from angel investors and venture capitalists and should be considered in the capital raising process. Similarly to angel and VC financing, companies seeking SBA and SBIC financing need a strong management team and value proposition, and a highly professional and compelling business plan in order to raise the capital they need.
About the author:
GT Business Plans has developed over 200 business plans for clients that have collectively raised over $750 million in financing, launched numerous new product and service lines and gained competitive advantage and market share. GT Business Plans is the sister site of GT Venture Capital
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While most companies seeking venture capital initially think about angel investors and venture capitalists, a large alternative source of financing is federal grants and loans. The two largest federal grant programs are run by the Small Business Administration (SBA), and by Small Business Investment Companies (SBICs).
An SBA loan, regardless of whether it is a direct loan from the SBA, or, as is more common, a bank loan guaranteed by the SBA, is essentially a bank loan. The benefit of it versus a traditional bank loan is the rate. SBA rates are typically much less than traditional business loan rates.
In most cases, in a guaranteed SBA bank loan, the SBA guarantees 90 percent of the loan will be repaid to the bank. As such, banks are at much less risk than in most other loans, and are a bit more flexible with regards to who they offer these loans. However, the SBA usually requires the founders of the company to personally guarantee the loans, which makes them risky should the venture collapse.
Alternatively, Small Business Investment Companies (SBICs) are privately organized corporations that are licensed and regulated by the SBA. Small or emerging businesses which qualify for assistance from the SBIC program can receive equity capital and/or long-term loans from these companies. Essentially, these companies provide their own capital, which is supplemented by federal funds, to the companies they fund.
Interestingly, U.S. taxpayers benefits from the SBIC program as tax revenues generated from successful SBIC investments have more than covered the cost of the program. Likewise the program has created hundreds of thousands of jobs.
In summary, SBA and SBIC financing are viable alternatives to financing from angel investors and venture capitalists and should be considered in the capital raising process. Similarly to angel and VC financing, companies seeking SBA and SBIC financing need a strong management team and value proposition, and a highly professional and compelling business plan in order to raise the capital they need.
About the author:
GT Business Plans has developed over 200 business plans for clients that have collectively raised over $750 million in financing, launched numerous new product and service lines and gained competitive advantage and market share. GT Business Plans is the sister site of GT Venture Capital
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Applying for a Business Loan
by: Matt Bacak
Copyright 2005 The Powerful Promoter
The process of applying for a business loan is a stringent one as compared to the standard procedures in obtaining a home mortgage loan or a personal loan. This is probably due to the fact that business loans contain a greater risk element as compared to other loans. Therefore, lenders need to exercise greater caution and emphasis when evaluating business loan applications in order to minimize their risk exposure.
With that, lenders evaluate their applicants based on the information that are provided as well as their judgment of the viability and profitability of the business being financed. Thus, business loan applicants will be required to submit a loan proposal along with their applications with the purpose of creating a positive impression upon the lender.
The first element of a loan proposal is an executive summary, providing short descriptions of the type of business and the industry, the purpose and usage of the loan, the proposed repayment conditions as well as the intended loan period. After that, the company information is provided, enriching the reader with the nature of the business, the location of the business, company history, the products or services provided, key differentiation factors of the company or the product, the general growth of the industry, competitive information, growth potential and target customers.
It would help if you could include your company marketing strategy, detailed product information, historical information as well as projected growth plans for the company. Apart from that, if you plan to incorporate product or service extensions in the future, you should provide these descriptions within your loan proposal. If possible, geographical expansion plans will help in the proposal.
The next area that needs to be showcased in the proposal would be the credentials and experience of each member of the management team. Impressive credentials will provide assurance to the lender that the company is managed by individuals who are responsible and capable. This is important as having the wrong people managing the company could be detrimental for the business.
In any loan application, historical records are essential to be used in evaluating the performance of a company. As new companies do not yet have these records, the financial records of the owners will be used as the basis of evaluation. Income tax returns forms are also required by lenders. All of these records provided should be the latest copies less than 90 days old, with the exception of the income tax returns form.
If the loan is applied for an existing company in active operations, company financial statements, including profit and loss accounts, balance sheets and the net worth reconciliation record should be included in the loan proposal. Again, all of this information should also be the latest and less than 90 days old. Additionally, a listing of accounts receivables and other short term and long term debt should be attached.
On the other hand, if the loan application is submitted for a new business, a pro-forma balance sheet and profit and loss account should be provided. Apart from that, a cash flow projection for the upcoming year is drafted to indicate the possibility of recovering the debt. This also means that projected revenue, profits, costs incurred and expenditure should be listed out with definite explanations provided as well as a list of assumptions.
If you possess assets that you wish to use as collateral for your loan, details for this should be provided to the lender as well. It is often common for lenders to request for dual sources of repayment in the event that one source is defaulted. This means that if the business owner defaults on his repayments, the collateral can be sold in order to recover debt.
Finally, other documents normally required for a loan application would be items like the article of incorporation, lease agreements, partnership agreements, license, references, etc. As the list of required documentation, information and attachments differs between lenders, it is best to check with the individual lender on their specific information and documents required to be attached with the loan proposal.
About the author:
Matt Bacak, The Powerful Promoter and Entrepreneur Magazine e-Biz radio show host, became a "##1 Best Selling Author" in just a few short hours. He has helped a number of clients target his specialty, opt-in email direct marketing systems. The Powerful Promoter is not only a sought-after internet marketer but has also marketed for some of the world's top experts whose reputations would shrivel if their followers ever found out someone else coached them on their online marketing strategies. For more information, visit Bacak's site at http://www.powerfulpromoter.comor sign up for his Powerful Promoting Tips at http://www.promotingtips.com
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Copyright 2005 The Powerful Promoter
The process of applying for a business loan is a stringent one as compared to the standard procedures in obtaining a home mortgage loan or a personal loan. This is probably due to the fact that business loans contain a greater risk element as compared to other loans. Therefore, lenders need to exercise greater caution and emphasis when evaluating business loan applications in order to minimize their risk exposure.
With that, lenders evaluate their applicants based on the information that are provided as well as their judgment of the viability and profitability of the business being financed. Thus, business loan applicants will be required to submit a loan proposal along with their applications with the purpose of creating a positive impression upon the lender.
The first element of a loan proposal is an executive summary, providing short descriptions of the type of business and the industry, the purpose and usage of the loan, the proposed repayment conditions as well as the intended loan period. After that, the company information is provided, enriching the reader with the nature of the business, the location of the business, company history, the products or services provided, key differentiation factors of the company or the product, the general growth of the industry, competitive information, growth potential and target customers.
It would help if you could include your company marketing strategy, detailed product information, historical information as well as projected growth plans for the company. Apart from that, if you plan to incorporate product or service extensions in the future, you should provide these descriptions within your loan proposal. If possible, geographical expansion plans will help in the proposal.
The next area that needs to be showcased in the proposal would be the credentials and experience of each member of the management team. Impressive credentials will provide assurance to the lender that the company is managed by individuals who are responsible and capable. This is important as having the wrong people managing the company could be detrimental for the business.
In any loan application, historical records are essential to be used in evaluating the performance of a company. As new companies do not yet have these records, the financial records of the owners will be used as the basis of evaluation. Income tax returns forms are also required by lenders. All of these records provided should be the latest copies less than 90 days old, with the exception of the income tax returns form.
If the loan is applied for an existing company in active operations, company financial statements, including profit and loss accounts, balance sheets and the net worth reconciliation record should be included in the loan proposal. Again, all of this information should also be the latest and less than 90 days old. Additionally, a listing of accounts receivables and other short term and long term debt should be attached.
On the other hand, if the loan application is submitted for a new business, a pro-forma balance sheet and profit and loss account should be provided. Apart from that, a cash flow projection for the upcoming year is drafted to indicate the possibility of recovering the debt. This also means that projected revenue, profits, costs incurred and expenditure should be listed out with definite explanations provided as well as a list of assumptions.
If you possess assets that you wish to use as collateral for your loan, details for this should be provided to the lender as well. It is often common for lenders to request for dual sources of repayment in the event that one source is defaulted. This means that if the business owner defaults on his repayments, the collateral can be sold in order to recover debt.
Finally, other documents normally required for a loan application would be items like the article of incorporation, lease agreements, partnership agreements, license, references, etc. As the list of required documentation, information and attachments differs between lenders, it is best to check with the individual lender on their specific information and documents required to be attached with the loan proposal.
About the author:
Matt Bacak, The Powerful Promoter and Entrepreneur Magazine e-Biz radio show host, became a "##1 Best Selling Author" in just a few short hours. He has helped a number of clients target his specialty, opt-in email direct marketing systems. The Powerful Promoter is not only a sought-after internet marketer but has also marketed for some of the world's top experts whose reputations would shrivel if their followers ever found out someone else coached them on their online marketing strategies. For more information, visit Bacak's site at http://www.powerfulpromoter.comor sign up for his Powerful Promoting Tips at http://www.promotingtips.com
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9 things you must do to maximize your chances of obtaining a small business loan
by: Neil Best
To get approval for your small business loan application, you must be able to meet the lending criteria set down. Some organisations are more risk averse than others, and will therefore have more stringent criteria.
To vastly increase your chances of a successful funding application, you will need to present the following information:
1. The reason for the loan. The lender will be looking for something that fits within the normal range and expertise of your business. The amount may cover a number of items, so you will need to cover each.
2. The amount required, and the repayment term of the small business loan you want. (e.g. $10,000 term 5 years, payable quarterly).
3. Details of how you will repay the amount borrowed. For example, “From the increase in profits of reduced running costs of the Whizzbang Go4It”
4. Details of security you will be able to offer to the lender. This will act as reassurance for the lender. If you’re not prepared to put up some aspect of security, then why should they?
5. You will need to include your business plan which will serve to answer essential questions relating to management capabilities, information about the market you operate in. What kind of business you are in etc.
6. 3 Years financial statements. You will need to present quality financial information from your accounting software, preferably signed off by your accountant or tax advisor.
7. Latest Set of Management accounts. Again produced from your accounting software.
8. Accounts receivables (debtors) and payables (creditors) ageing reports.
9. Principals financial statements. – Particularly required if some form of security is necessary.
If you are a new company, the emphasis is going to be on your business plan , and the security (also called collateral) you or your business can provide against the loan.
You must take the time to practice presenting your case to the bank or lender to iron out any glitches. Practice on your colleagues and family (you never know, they might be so impressed, they'll invest or lend!). It may help to role play the lender and come up with as many pointy questions as possible. The more time you take the better your chances will be. (But remember, don’t fall into the analysis paralysis trap!)
Good luck!
About the author:
Neil Best is an accountant with over 15 years experience in business finance. This article and other useful business finance information such as making effective business plans and sourcing and applying for business grants can be found at http://www.smallbusinessfinancetips.com/small-business-loans.html
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To get approval for your small business loan application, you must be able to meet the lending criteria set down. Some organisations are more risk averse than others, and will therefore have more stringent criteria.
To vastly increase your chances of a successful funding application, you will need to present the following information:
1. The reason for the loan. The lender will be looking for something that fits within the normal range and expertise of your business. The amount may cover a number of items, so you will need to cover each.
2. The amount required, and the repayment term of the small business loan you want. (e.g. $10,000 term 5 years, payable quarterly).
3. Details of how you will repay the amount borrowed. For example, “From the increase in profits of reduced running costs of the Whizzbang Go4It”
4. Details of security you will be able to offer to the lender. This will act as reassurance for the lender. If you’re not prepared to put up some aspect of security, then why should they?
5. You will need to include your business plan which will serve to answer essential questions relating to management capabilities, information about the market you operate in. What kind of business you are in etc.
6. 3 Years financial statements. You will need to present quality financial information from your accounting software, preferably signed off by your accountant or tax advisor.
7. Latest Set of Management accounts. Again produced from your accounting software.
8. Accounts receivables (debtors) and payables (creditors) ageing reports.
9. Principals financial statements. – Particularly required if some form of security is necessary.
If you are a new company, the emphasis is going to be on your business plan , and the security (also called collateral) you or your business can provide against the loan.
You must take the time to practice presenting your case to the bank or lender to iron out any glitches. Practice on your colleagues and family (you never know, they might be so impressed, they'll invest or lend!). It may help to role play the lender and come up with as many pointy questions as possible. The more time you take the better your chances will be. (But remember, don’t fall into the analysis paralysis trap!)
Good luck!
About the author:
Neil Best is an accountant with over 15 years experience in business finance. This article and other useful business finance information such as making effective business plans and sourcing and applying for business grants can be found at http://www.smallbusinessfinancetips.com/small-business-loans.html
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The Basics of Borrowing Money
by: Jose Valdez
Are you thinking about starting a business but have no money to do it with? Well, you're not alone. This article will tell you the basics of borrowing money.
A loan is money that is borrowed, and has to be paid back along with interest. If the money is borrowed from an institution such as a bank, this is called a commercial loan. Money that is borrowed from a friend or a relative is called a personal loan.
The borrower, or debtor, is the business or individual that takes out the loan. The lender, or creditor, is the source from which the money was borrowed. The term, or period, is the time that is specified during which the borrower has to use the money borrowed before he has to repay the loan. The maturity of a loan is when a loan term reaches its end. The Principal is the amount that is borrowed from the lender. When you or your business borrows money, the lender wants to know when they will get their money back. Keep this in mind when you are looking for a lending source.
If the business is not able to repay the loan, the lending source has a right to legally come after assets to recoup it's money. The extent to which you are personally liable depends on the business structure your business is operating under.
If you are approved for a loan, that you will have to make scheduled payments (typically on monthly basis) plus interest. A loan can sometimes be set up as a balloon loan. A balloon loan will typically require smaller initial payments and one lump sum of what was borrowed as the final payment at the end of the term.
Borrowing from Institutions
Business loans generally fall into two main categories: short term and long term loans. A short term loan is a loan that is to be payed back within one year. Examples of short term loans include:
Working capital loans
Accounts receivable loans
Lines of credit
Long term loans are loans that are to be payed back typically from one to seven years. Long term loans are typically used for:
an expansion of a business
the purchase of equipment
real estate
Most business loans that are used for starting a business are long term loans.
When you approach an institution for a business loan, it will be looking at you as the business owner as closely as it will be looking at the business itself. One of the ways lending institutions make money is by lending money and they want to be as sure as possible that they get back their money with the interest owed.
The time between applying for a loan and learning that you have been approved (or disapproved) can vary. If you are disapproved, you may be told almost instantly. If you are approved, it may take a few days though it usually takes longer. It may even take several months to learn whether you or your business has being approved for the loan.
Borrowing from Family and Friends
If you don't want to, or can't get a commercial loan, you can consider getting a private loan from family or friends. This is usually real informal. However, you need to be careful because this can lead to ruined relationships.
If you are getting a private loan, it is in the best interest of the lender to have an agreement put in writing. The written agreement should state the principal, the interest charged and the terms of repayment. This puts the lender in better position either write off the loan on his or her tax return or to legally come after you.
You are free to reprint this only if the article text link is included:
If You are Starting a Business visit www.AGuideToStartingABusiness.com
Jose Valdez is the owner/operator of www.AGuideToStartingABusiness.com and www.AllHomeBasedBusinessIdeas.com
About the author:
Jose Valdez is the owner/operator of www.AGuideToStartingABusiness.comand www.AllHomeBasedBusinessIdeas.com
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Are you thinking about starting a business but have no money to do it with? Well, you're not alone. This article will tell you the basics of borrowing money.
A loan is money that is borrowed, and has to be paid back along with interest. If the money is borrowed from an institution such as a bank, this is called a commercial loan. Money that is borrowed from a friend or a relative is called a personal loan.
The borrower, or debtor, is the business or individual that takes out the loan. The lender, or creditor, is the source from which the money was borrowed. The term, or period, is the time that is specified during which the borrower has to use the money borrowed before he has to repay the loan. The maturity of a loan is when a loan term reaches its end. The Principal is the amount that is borrowed from the lender. When you or your business borrows money, the lender wants to know when they will get their money back. Keep this in mind when you are looking for a lending source.
If the business is not able to repay the loan, the lending source has a right to legally come after assets to recoup it's money. The extent to which you are personally liable depends on the business structure your business is operating under.
If you are approved for a loan, that you will have to make scheduled payments (typically on monthly basis) plus interest. A loan can sometimes be set up as a balloon loan. A balloon loan will typically require smaller initial payments and one lump sum of what was borrowed as the final payment at the end of the term.
Borrowing from Institutions
Business loans generally fall into two main categories: short term and long term loans. A short term loan is a loan that is to be payed back within one year. Examples of short term loans include:
Working capital loans
Accounts receivable loans
Lines of credit
Long term loans are loans that are to be payed back typically from one to seven years. Long term loans are typically used for:
an expansion of a business
the purchase of equipment
real estate
Most business loans that are used for starting a business are long term loans.
When you approach an institution for a business loan, it will be looking at you as the business owner as closely as it will be looking at the business itself. One of the ways lending institutions make money is by lending money and they want to be as sure as possible that they get back their money with the interest owed.
The time between applying for a loan and learning that you have been approved (or disapproved) can vary. If you are disapproved, you may be told almost instantly. If you are approved, it may take a few days though it usually takes longer. It may even take several months to learn whether you or your business has being approved for the loan.
Borrowing from Family and Friends
If you don't want to, or can't get a commercial loan, you can consider getting a private loan from family or friends. This is usually real informal. However, you need to be careful because this can lead to ruined relationships.
If you are getting a private loan, it is in the best interest of the lender to have an agreement put in writing. The written agreement should state the principal, the interest charged and the terms of repayment. This puts the lender in better position either write off the loan on his or her tax return or to legally come after you.
You are free to reprint this only if the article text link is included:
If You are Starting a Business visit www.AGuideToStartingABusiness.com
Jose Valdez is the owner/operator of www.AGuideToStartingABusiness.com and www.AllHomeBasedBusinessIdeas.com
About the author:
Jose Valdez is the owner/operator of www.AGuideToStartingABusiness.comand www.AllHomeBasedBusinessIdeas.com
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Applying for a Loan
by: Matt Bacak
The process of applying for a business loan is a stringent one as compared to the standard procedures in obtaining a home mortgage loan or a personal loan. This is probably due to the fact that business loans contain a greater risk element as compared to other loans. Therefore, lenders need to exercise greater caution and emphasis when evaluating business loan applications in order to minimize their risk exposure.
With that, lenders evaluate their applicants based on the information that are provided as well as their judgment of the viability and profitability of the business being financed. Thus, business loan applicants will be required to submit a loan proposal along with their applications with the purpose of creating a positive impression upon the lender.
The first element of a loan proposal is an executive summary, providing short descriptions of the type of business and the industry, the purpose and usage of the loan, the proposed repayment conditions as well as the intended loan period. After that, the company information is provided, enriching the reader with the nature of the business, the location of the business, company history, the products or services provided, key differentiation factors of the company or the product, the general growth of the industry, competitive information, growth potential and target customers.
It would help if you could include your company marketing strategy, detailed product information, historical information as well as projected growth plans for the company. Apart from that, if you plan to incorporate product or service extensions in the future, you should provide these descriptions within your loan proposal. If possible, geographical expansion plans will help in the proposal.
The next area that needs to be showcased in the proposal would be the credentials and experience of each member of the management team. Impressive credentials will provide assurance to the lender that the company is managed by individuals who are responsible and capable. This is important as having the wrong people managing the company could be detrimental for the business.
In any loan application, historical records are essential to be used in evaluating the performance of a company. As new companies do not yet have these records, the financial records of the owners will be used as the basis of evaluation. Income tax returns forms are also required by lenders. All of these records provided should be the latest copies less than 90 days old, with the exception of the income tax returns form.
If the loan is applied for an existing company in active operations, company financial statements, including profit and loss accounts, balance sheets and the net worth reconciliation record should be included in the loan proposal. Again, all of this information should also be the latest and less than 90 days old. Additionally, a listing of accounts receivables and other short term and long term debt should be attached.
On the other hand, if the loan application is submitted for a new business, a pro-forma balance sheet and profit and loss account should be provided. Apart from that, a cash flow projection for the upcoming year is drafted to indicate the possibility of recovering the debt. This also means that projected revenue, profits, costs incurred and expenditure should be listed out with definite explanations provided as well as a list of assumptions.
If you possess assets that you wish to use as collateral for your loan, details for this should be provided to the lender as well. It is often common for lenders to request for dual sources of repayment in the event that one source is defaulted. This means that if the business owner defaults on his repayments, the collateral can be sold in order to recover debt.
Finally, other documents normally required for a loan application would be items like the article of incorporation, lease agreements, partnership agreements, license, references, etc. As the list of required documentation, information and attachments differs between lenders, it is best to check with the individual lender on their specific information and documents required to be attached with the loan proposal.
About the author:
Matt Bacak became "##1 Best Selling Author" in just a few short hours.
Recent Entrepreneur Magazine’s e-Biz radio show host is
turning Authors, Speakers, and Experts into Overnight Success Stories.
Discover The Secrets http://promotingtips.com
Circulated by Article Emporium
The process of applying for a business loan is a stringent one as compared to the standard procedures in obtaining a home mortgage loan or a personal loan. This is probably due to the fact that business loans contain a greater risk element as compared to other loans. Therefore, lenders need to exercise greater caution and emphasis when evaluating business loan applications in order to minimize their risk exposure.
With that, lenders evaluate their applicants based on the information that are provided as well as their judgment of the viability and profitability of the business being financed. Thus, business loan applicants will be required to submit a loan proposal along with their applications with the purpose of creating a positive impression upon the lender.
The first element of a loan proposal is an executive summary, providing short descriptions of the type of business and the industry, the purpose and usage of the loan, the proposed repayment conditions as well as the intended loan period. After that, the company information is provided, enriching the reader with the nature of the business, the location of the business, company history, the products or services provided, key differentiation factors of the company or the product, the general growth of the industry, competitive information, growth potential and target customers.
It would help if you could include your company marketing strategy, detailed product information, historical information as well as projected growth plans for the company. Apart from that, if you plan to incorporate product or service extensions in the future, you should provide these descriptions within your loan proposal. If possible, geographical expansion plans will help in the proposal.
The next area that needs to be showcased in the proposal would be the credentials and experience of each member of the management team. Impressive credentials will provide assurance to the lender that the company is managed by individuals who are responsible and capable. This is important as having the wrong people managing the company could be detrimental for the business.
In any loan application, historical records are essential to be used in evaluating the performance of a company. As new companies do not yet have these records, the financial records of the owners will be used as the basis of evaluation. Income tax returns forms are also required by lenders. All of these records provided should be the latest copies less than 90 days old, with the exception of the income tax returns form.
If the loan is applied for an existing company in active operations, company financial statements, including profit and loss accounts, balance sheets and the net worth reconciliation record should be included in the loan proposal. Again, all of this information should also be the latest and less than 90 days old. Additionally, a listing of accounts receivables and other short term and long term debt should be attached.
On the other hand, if the loan application is submitted for a new business, a pro-forma balance sheet and profit and loss account should be provided. Apart from that, a cash flow projection for the upcoming year is drafted to indicate the possibility of recovering the debt. This also means that projected revenue, profits, costs incurred and expenditure should be listed out with definite explanations provided as well as a list of assumptions.
If you possess assets that you wish to use as collateral for your loan, details for this should be provided to the lender as well. It is often common for lenders to request for dual sources of repayment in the event that one source is defaulted. This means that if the business owner defaults on his repayments, the collateral can be sold in order to recover debt.
Finally, other documents normally required for a loan application would be items like the article of incorporation, lease agreements, partnership agreements, license, references, etc. As the list of required documentation, information and attachments differs between lenders, it is best to check with the individual lender on their specific information and documents required to be attached with the loan proposal.
About the author:
Matt Bacak became "##1 Best Selling Author" in just a few short hours.
Recent Entrepreneur Magazine’s e-Biz radio show host is
turning Authors, Speakers, and Experts into Overnight Success Stories.
Discover The Secrets http://promotingtips.com
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Business loans: translating potential for financial success and independence
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Business loans: translating potential for financial success and independence
by: Natasha Anderson
A good entrepreneur knows that the essence of striking gold in business is finding the right opportunity and going after it despite the risks. These opportunities keep on sprouting when you are doing business. Or you might have stumbled upon one and contemplating taking it. Your financial condition may not help you to translate your potential for financial success and independence. Business loans can facilitate this translation.
Obtaining finance is central for starting a new business or making business grow. Financing a business through business loans can be a formidable task. But a good preparation can easily sort out any matter detrimental to getting your business loans approved. Taking a loan for business is an important decision. A business loans borrower must understand that while taking loans can help a business grow, a wrong decision will mean debt and actually damage financial stability of a business. Determine how much loan amount you require as business loans. There are different business loans products to decide from.
A well thought out business plan is the most significant part of getting a business loans approved. The business plan should have projection. Don’t go into details, a concise to the point executive summary which answers all the queries of a business loans, will gain easy acceptance. If you have an established business – financial statement, cash flow for the past three years will be required.
When business loans application is reviewed, some of the following questions might come up in one version or the other.
• How much loan do you require?
• What about business profits, does it have enough cash flow, to service the debt?
• Is there collateral to cover the loan?
• Is there a reasonable balance between debt and equity?
Business loans lender would pay much emphasis on your repayment ability. He would like to know if you have invested your own money in the business. He would not be very interested in taking risk in a venture where the business owner has not.
For business loans it is important to know your credit history. The business loans lender will undeniably go through your credit history. Go through your recent credit history and find out faults and recent credit discrepancies. If there are inconsistencies, get them removed. A credit history that is questionable will most likely not get business loans. However, if you attach a letter explaining your credit conduct can evoke a favourable response. The worst mistake will be to hiding your faults. This will most certainly reject an otherwise encouraging business loans application.
Few people realize it but locating a good business loans lender is integral to finding business loans. It is not easy to find business loans lender that abides by your needs. In fact it is an investment in itself. Look for business loans lender who is willing to work with you and for you.
Business loans also depend on your character and your ability to be present yourself, your business details and your confidence. They also count in getting your business loans accepted. In case business loans application is rejected – make sure you know the reason why this happened. This will enable you to rectify mistakes next time you make attempt to get business loans.
Collateral is chief ingredient for business loans. Secured business loans will require collateral and greatly add to the business loans application. Business loans without collateral are unsecured business loans. They are usually difficult to find. But unsecured business loans will only satisfy small financing needs.
Business loans are available for most financing needs. Business loans can be used for starting a business, refinancing, expanding your business, purchase of equipments or any other commercial investment. Insufficient business funds are one of the leading causes of business failure.
About the author:
After having herself gone through the ordeal of loan borrowing, Natasha Anderson understands the need for good quality loan advice. Her articles endeavor to provide you the wise counsel in the most elementary way for the benefit of the readers. She hopes that this will help them to locate the loan that beseems their expectations. She works for the UK secured loan web site uk finance world.To find a Secured or unsecured loan that best suits your needs visit http://www.ukfinanceworld.co.uk
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Business loans: translating potential for financial success and independence
by: Natasha Anderson
A good entrepreneur knows that the essence of striking gold in business is finding the right opportunity and going after it despite the risks. These opportunities keep on sprouting when you are doing business. Or you might have stumbled upon one and contemplating taking it. Your financial condition may not help you to translate your potential for financial success and independence. Business loans can facilitate this translation.
Obtaining finance is central for starting a new business or making business grow. Financing a business through business loans can be a formidable task. But a good preparation can easily sort out any matter detrimental to getting your business loans approved. Taking a loan for business is an important decision. A business loans borrower must understand that while taking loans can help a business grow, a wrong decision will mean debt and actually damage financial stability of a business. Determine how much loan amount you require as business loans. There are different business loans products to decide from.
A well thought out business plan is the most significant part of getting a business loans approved. The business plan should have projection. Don’t go into details, a concise to the point executive summary which answers all the queries of a business loans, will gain easy acceptance. If you have an established business – financial statement, cash flow for the past three years will be required.
When business loans application is reviewed, some of the following questions might come up in one version or the other.
• How much loan do you require?
• What about business profits, does it have enough cash flow, to service the debt?
• Is there collateral to cover the loan?
• Is there a reasonable balance between debt and equity?
Business loans lender would pay much emphasis on your repayment ability. He would like to know if you have invested your own money in the business. He would not be very interested in taking risk in a venture where the business owner has not.
For business loans it is important to know your credit history. The business loans lender will undeniably go through your credit history. Go through your recent credit history and find out faults and recent credit discrepancies. If there are inconsistencies, get them removed. A credit history that is questionable will most likely not get business loans. However, if you attach a letter explaining your credit conduct can evoke a favourable response. The worst mistake will be to hiding your faults. This will most certainly reject an otherwise encouraging business loans application.
Few people realize it but locating a good business loans lender is integral to finding business loans. It is not easy to find business loans lender that abides by your needs. In fact it is an investment in itself. Look for business loans lender who is willing to work with you and for you.
Business loans also depend on your character and your ability to be present yourself, your business details and your confidence. They also count in getting your business loans accepted. In case business loans application is rejected – make sure you know the reason why this happened. This will enable you to rectify mistakes next time you make attempt to get business loans.
Collateral is chief ingredient for business loans. Secured business loans will require collateral and greatly add to the business loans application. Business loans without collateral are unsecured business loans. They are usually difficult to find. But unsecured business loans will only satisfy small financing needs.
Business loans are available for most financing needs. Business loans can be used for starting a business, refinancing, expanding your business, purchase of equipments or any other commercial investment. Insufficient business funds are one of the leading causes of business failure.
About the author:
After having herself gone through the ordeal of loan borrowing, Natasha Anderson understands the need for good quality loan advice. Her articles endeavor to provide you the wise counsel in the most elementary way for the benefit of the readers. She hopes that this will help them to locate the loan that beseems their expectations. She works for the UK secured loan web site uk finance world.To find a Secured or unsecured loan that best suits your needs visit http://www.ukfinanceworld.co.uk
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Thursday, May 28, 2009
Where To Find Products To Sell On Ebay
by: David Riewe
One key for business success using eBay is sourcing products to sell. The first questions eBay sellers should ask themselves are: "What can I sell?" and "Where can I buy?"
There are two kinds of sellers on eBay, garage sellers and business sellers. Garage sellers are people who sell products they are not going to use any more and that are usually not new. Garage sellers are not profit driven, their main objective is usually to get rid of some stuff they don't need. They will be happy to make some money by selling something that is no longer useful to them. On the other hand, business sellers are people who will buy and sell products for profit, they consider eBay a business and need to earn profit on the products they sell.
The first key to success for business sellers is an old marketing rule, RESEARCH. The products you need to sell are products that eBay buyers will want to buy. Apart from being a massive market place, eBay offers you a cheap source of research that you can conduct without moving from your computer.
If you are a business seller, it is fundamental that you spend some time researching before you decide which products you want to sell. Follow these research guidelines:
1. Search for the categories that are most popular. The first index is the number of listings that exist under each category. In addition, you need to look at how many bids the products have.
2. Look at the ratings of the sellers who are listing products in each category and study their profiles. See how many products they are selling and how many products they have sold in the past.
3. Analyze prices. You need to become an expert in your category and you need to know at which price a product is worth buying as well as the expected final winning price of your auction.
4. Select no more than one or two categories. "Specialization" is another basic rule of marketing. It is better to become an expert on something, as this will inspire confidence and trust in your potential customers. Online marketing is all about trust.
For conducting good research, you need time and organization. There are different software programs in the market that can help you save time as well as optimize your research.
Now that you are becoming an eBay expert and have conducted a proper search, you are almost ready to start your business. Before starting to sell, you need to buy! Here are some ideas from where you can source products:
1. Write your own e-book and sell it. If you have any passion or are an expert on a subject for which you can find a niche in eBay, do not hesitate to spend some time on writing your own book. The advantage of this is that after your initial time investment, you can sell and sell copies of the book without having any additional costs. Selling information products is one of the most profitable businesses. Even if you are not an expert writer, you can find other people who can write the book for you.
2. Use drop-shipping. There are wholesalers that will sell you products and send them to the address that you tell them. The advantage of this source is that you do not need to carry inventories, so your investments are minimized. After your auction is finished, you send them your customers address and they will do all the shipping. If you decide to use this kind of source, you need to make sure that your auctions winning price can be higher than the price you will pay for the articles. At minimum you should expect to double your costs.
3. Buy from eBay. Many eBayers success comes from knowing how to buy well on eBay and sell the same products at a higher price. If you know your category very well, you can easily find opportunities that will allow you to buy and resell making profit. Again, solid research is fundamental.
4. Buy Asiatic products. If you are willing to carry some inventories, you can invest on Asiatic products and buy them for a very cheap price. You can easily start importing Asiatic products from the Internet at www.alibaba.com.
5. Sell local products. If you live in an area that produces local products which can be bought at a cheap price and shipped to other areas where people would pay more, you should take advantage of the situation.
Best wishes for your success
About the author:
Discover 101 Ebay Auction Tips in this FREE ebook http://www.push-button-online-income.com/ebooks
Circulated by Article Emporium
One key for business success using eBay is sourcing products to sell. The first questions eBay sellers should ask themselves are: "What can I sell?" and "Where can I buy?"
There are two kinds of sellers on eBay, garage sellers and business sellers. Garage sellers are people who sell products they are not going to use any more and that are usually not new. Garage sellers are not profit driven, their main objective is usually to get rid of some stuff they don't need. They will be happy to make some money by selling something that is no longer useful to them. On the other hand, business sellers are people who will buy and sell products for profit, they consider eBay a business and need to earn profit on the products they sell.
The first key to success for business sellers is an old marketing rule, RESEARCH. The products you need to sell are products that eBay buyers will want to buy. Apart from being a massive market place, eBay offers you a cheap source of research that you can conduct without moving from your computer.
If you are a business seller, it is fundamental that you spend some time researching before you decide which products you want to sell. Follow these research guidelines:
1. Search for the categories that are most popular. The first index is the number of listings that exist under each category. In addition, you need to look at how many bids the products have.
2. Look at the ratings of the sellers who are listing products in each category and study their profiles. See how many products they are selling and how many products they have sold in the past.
3. Analyze prices. You need to become an expert in your category and you need to know at which price a product is worth buying as well as the expected final winning price of your auction.
4. Select no more than one or two categories. "Specialization" is another basic rule of marketing. It is better to become an expert on something, as this will inspire confidence and trust in your potential customers. Online marketing is all about trust.
For conducting good research, you need time and organization. There are different software programs in the market that can help you save time as well as optimize your research.
Now that you are becoming an eBay expert and have conducted a proper search, you are almost ready to start your business. Before starting to sell, you need to buy! Here are some ideas from where you can source products:
1. Write your own e-book and sell it. If you have any passion or are an expert on a subject for which you can find a niche in eBay, do not hesitate to spend some time on writing your own book. The advantage of this is that after your initial time investment, you can sell and sell copies of the book without having any additional costs. Selling information products is one of the most profitable businesses. Even if you are not an expert writer, you can find other people who can write the book for you.
2. Use drop-shipping. There are wholesalers that will sell you products and send them to the address that you tell them. The advantage of this source is that you do not need to carry inventories, so your investments are minimized. After your auction is finished, you send them your customers address and they will do all the shipping. If you decide to use this kind of source, you need to make sure that your auctions winning price can be higher than the price you will pay for the articles. At minimum you should expect to double your costs.
3. Buy from eBay. Many eBayers success comes from knowing how to buy well on eBay and sell the same products at a higher price. If you know your category very well, you can easily find opportunities that will allow you to buy and resell making profit. Again, solid research is fundamental.
4. Buy Asiatic products. If you are willing to carry some inventories, you can invest on Asiatic products and buy them for a very cheap price. You can easily start importing Asiatic products from the Internet at www.alibaba.com.
5. Sell local products. If you live in an area that produces local products which can be bought at a cheap price and shipped to other areas where people would pay more, you should take advantage of the situation.
Best wishes for your success
About the author:
Discover 101 Ebay Auction Tips in this FREE ebook http://www.push-button-online-income.com/ebooks
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How to give your customers a choice between you and the competition and have them choose you.
by: Michelle Dunn
Instead of giving your customers or potential customers a choice between you and your competition and having them choose the other guy, have them choose you.
Michelle Dunn’s new book” Become the Squeaky Wheel,” says creating a credit policy can have surprising results.
According to Dunn, a leader in the debt collection industry, some customers, when given the choice, between signing a credit application or paying at the time of sale, mostly choose the credit application regardless of who has the cheaper prices. It is true that some customers will buy more from you if they are approved for credit and have more time to pay. It makes it easy for them to place orders and receive a bill, rather than have to pay at the point of sale.
Like everything else, the easier you make it for the customer to buy from you the more sales you will have. Customers want things to be easy, fast and instant. If they are credit approved and can call and order and have the item quickly, then pay when they receive a bill, they will be more likely to order from you than someone who doesn’t offer that option. Resulting in your business making more money and more sales.
About the author:
Michelle Dunn has over 17 years experience in credit and debt collection.
She has written 5 books in her Collecting Money Series. For more information on Michelle’s services or to order any of her books please email her at michelle@michelledunn.com or visit www.michelledunn.com& www.credit-and-collections.com
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Instead of giving your customers or potential customers a choice between you and your competition and having them choose the other guy, have them choose you.
Michelle Dunn’s new book” Become the Squeaky Wheel,” says creating a credit policy can have surprising results.
According to Dunn, a leader in the debt collection industry, some customers, when given the choice, between signing a credit application or paying at the time of sale, mostly choose the credit application regardless of who has the cheaper prices. It is true that some customers will buy more from you if they are approved for credit and have more time to pay. It makes it easy for them to place orders and receive a bill, rather than have to pay at the point of sale.
Like everything else, the easier you make it for the customer to buy from you the more sales you will have. Customers want things to be easy, fast and instant. If they are credit approved and can call and order and have the item quickly, then pay when they receive a bill, they will be more likely to order from you than someone who doesn’t offer that option. Resulting in your business making more money and more sales.
About the author:
Michelle Dunn has over 17 years experience in credit and debt collection.
She has written 5 books in her Collecting Money Series. For more information on Michelle’s services or to order any of her books please email her at michelle@michelledunn.com or visit www.michelledunn.com& www.credit-and-collections.com
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The REAL TRUTH on How to Write an eBook
by: John Macko
The hardest part of writing is the first sentence. When you look at the whole project, it seems like an impossible task. That's why you have to break it down into manageable tasks. Think of climbing a mountain.
You are standing at the foot of it and looking up at its summit vanishing into the clouds. How can you possibly scale such an immense and dangerous mountain? There is only one way to climb a mountain ? step by step.
Now think of writing your ebook in the same light. You must create it step by step, and one day, you will take that last step and find yourself standing on the summit with your head in the clouds.
The first thing you have to do, as if you actually were a mountain climber, is to get organized. Instead of climbing gear, however, you must organize your thoughts. There are some steps you should take before you begin. Once you've gone through the following list, you will be ready to actually begin writing your ebook.
Beginning Steps to Writing an ebook:
First, figure out your ebook's working title. Jot down a few different titles, and eventually, you'll find that one that will grow on you. Titles help you to focus your writing on your topic; they guide you in anticipating and answering your reader's queries. Many non-fiction books also have subtitles. Aim for clarity in your titles, but cleverness always helps to sell books? as long as it's not too cute. For example, Remedies for Insomnia: twenty different ways to count sheep. Or: Get off that couch: fifteen exercise plans to whip you into shape.
Next, write out a thesis statement. Your thesis is a sentence or two stating exactly what problem you are addressing and how your book will solve that problem. All chapters spring forth from your thesis statement. Once you've got your thesis statement fine-tuned, you've built your foundation. From that foundation, your book will grow, chapter by chapter.
Your thesis will keep you focused while you write your ebook. Remember: all chapters must support your thesis statement. If they don't, they don't belong in your book. For example, your thesis statement could read: We've all experienced insomnia at times in our lives, but there are twenty proven techniques and methods to give you back a good night's sleep.
Once you have your thesis, before you start to write, make sure there is a good reason to write your book. Ask yourself some questions:
* Does your book present useful information and is that information currently relevant?
* Will you book positively affect the lives of your readers?
Is your book dynamic and will it keep the reader's attention?
* Does you book answer questions that are meaningful and significant?
If you can answer yes to these questions, you can feel confident about the potential of your ebook.
Another important step is to figure out who your target audience is. It is this group of people you will be writing to, and this group will dictate many elements of your book, such as style, tone, diction, and even length.
Figure out the age range of your readers, their general gender, what they are most interested in, and even the socio-economic group they primarily come from. Are they people who read fashion magazines or book reviews? Do they write letters in longhand or spend hours every day online. The more you can pin down your target audience, the easier it will be to write your book for them.
Next, make a list of the reasons you are writing your ebook. Do you want to promote your business? Do you want to bring quality traffic to your website? Do you want to enhance your reputation?
Then write down your goals in terms of publishing.Do you want to sell it as a product on your website, or do you want to offer it as a free gift for filling out a survey or for ordering a product? Do you want to use the chapters to create an e-course, or use your ebook to attract affiliates around the world? The more you know upfront, the easier the actual writing will be.
Decide on the format of your chapters. In non-fiction, keep the format from chapter to chapter fairly consistent. Perhaps you plan to use an introduction to your chapter topic, and then divide it into four subhead topics. Or you may plan to divide it into five parts, each one beginning with a relevant anecdote.
How to make your ebook "user friendly".
You must figure out how to keep your writing engaging. Often anecdotes, testimonials, little stories, photos, graphs, advice, and tips will keep the reader turning the pages. Sidebars are useful for quick, accessible information and they break up the density of the page.
Write with a casual, conversational tone rather than a formal tone such as textbook diction. Reader's respond to the feeling that you are having a conversation with them. Break up the length and structure of your sentences so you don?t hypnotize your readers into sleep. Sentences that are all the same length and structure tend to be a good aid for insomnia!
Good writing takes practice. It takes lots and lots of practice. Make a schedule to write at least a page a day. Read books and magazines about the process of writing, and jot down tips that jump out at you. The art of writing is a lifetime process; the more you write (and read), the better your writing will become.The better your writing becomes, the bigger your sales figures.
In an ebook that is read on the screen, be aware that you must give your reader's eye a break. You can do this by utilizing white space. In art classes, white space is usually referred to as "negative space." Reader's eyes need to rest in the cool white oasises you create on your page. If your page is too dense, your reader will quit out of it as soon as their eyes begin to tear.
Make use of lists, both bulleted and numbered. This makes your information easy to absorb, and gives the reader a mental break from dissecting your paragraphs one after the other.
Finally, decide on an easy-to-read design. Find a font that's easy on the eyes, and stick to that font family. Using dozens of fonts will only tire your readers out before they've gotten past your introduction. Use at least one and a half line spacing, and text large enough to be read easily on the screen, but small enough so that the whole page can be seen on a computer screen. You will have to experiment with this to find the right combination.
Of course, don't forget to run a spell and grammar check. You are judged by something as minor as correct punctuation, so don?t mess up a great book by tossing out semicolons randomly, or stringing sentences together with commas. (By the way, that's called a "comma splice".)
Last of all, create an index and a bibliography. That's it! You've written a book! Now all you have to do is publish your ebook online, and wait for download request from your website visitors.
This article is part of a 6 part series on ebook writing, compiling and pricing structure. You can find all articles here over the next couple of days or see them all, along ith other great and informative articles on "The TRUTH" about Internet and affiliate marketing on my website listed below.
About the author:
John Macko "The Marketing Magican" provides valuable affiliate and marketing information resources and informative articles at http://pay-alot-less.com
Circulated by Article Emporium
The hardest part of writing is the first sentence. When you look at the whole project, it seems like an impossible task. That's why you have to break it down into manageable tasks. Think of climbing a mountain.
You are standing at the foot of it and looking up at its summit vanishing into the clouds. How can you possibly scale such an immense and dangerous mountain? There is only one way to climb a mountain ? step by step.
Now think of writing your ebook in the same light. You must create it step by step, and one day, you will take that last step and find yourself standing on the summit with your head in the clouds.
The first thing you have to do, as if you actually were a mountain climber, is to get organized. Instead of climbing gear, however, you must organize your thoughts. There are some steps you should take before you begin. Once you've gone through the following list, you will be ready to actually begin writing your ebook.
Beginning Steps to Writing an ebook:
First, figure out your ebook's working title. Jot down a few different titles, and eventually, you'll find that one that will grow on you. Titles help you to focus your writing on your topic; they guide you in anticipating and answering your reader's queries. Many non-fiction books also have subtitles. Aim for clarity in your titles, but cleverness always helps to sell books? as long as it's not too cute. For example, Remedies for Insomnia: twenty different ways to count sheep. Or: Get off that couch: fifteen exercise plans to whip you into shape.
Next, write out a thesis statement. Your thesis is a sentence or two stating exactly what problem you are addressing and how your book will solve that problem. All chapters spring forth from your thesis statement. Once you've got your thesis statement fine-tuned, you've built your foundation. From that foundation, your book will grow, chapter by chapter.
Your thesis will keep you focused while you write your ebook. Remember: all chapters must support your thesis statement. If they don't, they don't belong in your book. For example, your thesis statement could read: We've all experienced insomnia at times in our lives, but there are twenty proven techniques and methods to give you back a good night's sleep.
Once you have your thesis, before you start to write, make sure there is a good reason to write your book. Ask yourself some questions:
* Does your book present useful information and is that information currently relevant?
* Will you book positively affect the lives of your readers?
Is your book dynamic and will it keep the reader's attention?
* Does you book answer questions that are meaningful and significant?
If you can answer yes to these questions, you can feel confident about the potential of your ebook.
Another important step is to figure out who your target audience is. It is this group of people you will be writing to, and this group will dictate many elements of your book, such as style, tone, diction, and even length.
Figure out the age range of your readers, their general gender, what they are most interested in, and even the socio-economic group they primarily come from. Are they people who read fashion magazines or book reviews? Do they write letters in longhand or spend hours every day online. The more you can pin down your target audience, the easier it will be to write your book for them.
Next, make a list of the reasons you are writing your ebook. Do you want to promote your business? Do you want to bring quality traffic to your website? Do you want to enhance your reputation?
Then write down your goals in terms of publishing.Do you want to sell it as a product on your website, or do you want to offer it as a free gift for filling out a survey or for ordering a product? Do you want to use the chapters to create an e-course, or use your ebook to attract affiliates around the world? The more you know upfront, the easier the actual writing will be.
Decide on the format of your chapters. In non-fiction, keep the format from chapter to chapter fairly consistent. Perhaps you plan to use an introduction to your chapter topic, and then divide it into four subhead topics. Or you may plan to divide it into five parts, each one beginning with a relevant anecdote.
How to make your ebook "user friendly".
You must figure out how to keep your writing engaging. Often anecdotes, testimonials, little stories, photos, graphs, advice, and tips will keep the reader turning the pages. Sidebars are useful for quick, accessible information and they break up the density of the page.
Write with a casual, conversational tone rather than a formal tone such as textbook diction. Reader's respond to the feeling that you are having a conversation with them. Break up the length and structure of your sentences so you don?t hypnotize your readers into sleep. Sentences that are all the same length and structure tend to be a good aid for insomnia!
Good writing takes practice. It takes lots and lots of practice. Make a schedule to write at least a page a day. Read books and magazines about the process of writing, and jot down tips that jump out at you. The art of writing is a lifetime process; the more you write (and read), the better your writing will become.The better your writing becomes, the bigger your sales figures.
In an ebook that is read on the screen, be aware that you must give your reader's eye a break. You can do this by utilizing white space. In art classes, white space is usually referred to as "negative space." Reader's eyes need to rest in the cool white oasises you create on your page. If your page is too dense, your reader will quit out of it as soon as their eyes begin to tear.
Make use of lists, both bulleted and numbered. This makes your information easy to absorb, and gives the reader a mental break from dissecting your paragraphs one after the other.
Finally, decide on an easy-to-read design. Find a font that's easy on the eyes, and stick to that font family. Using dozens of fonts will only tire your readers out before they've gotten past your introduction. Use at least one and a half line spacing, and text large enough to be read easily on the screen, but small enough so that the whole page can be seen on a computer screen. You will have to experiment with this to find the right combination.
Of course, don't forget to run a spell and grammar check. You are judged by something as minor as correct punctuation, so don?t mess up a great book by tossing out semicolons randomly, or stringing sentences together with commas. (By the way, that's called a "comma splice".)
Last of all, create an index and a bibliography. That's it! You've written a book! Now all you have to do is publish your ebook online, and wait for download request from your website visitors.
This article is part of a 6 part series on ebook writing, compiling and pricing structure. You can find all articles here over the next couple of days or see them all, along ith other great and informative articles on "The TRUTH" about Internet and affiliate marketing on my website listed below.
About the author:
John Macko "The Marketing Magican" provides valuable affiliate and marketing information resources and informative articles at http://pay-alot-less.com
Circulated by Article Emporium
Maintain Focus to achieve real success!
by: Paul Duxbury
I think maintaining “focus" is probably one of the most important and the most difficult "challenges" we face when running an online business and trying to establish what will make us successful. Especially when you consider how many different opportunities we are bombarded with each and every day that can so easily distract us from what we are trying to achieve.
One of the tactics that I have found works is to be very clear about what I am doing and ensuring that what I am doing right now is contributing to the achievement of my vision/goals. So each time we do some work on our business we need to ask ourselves “What is it contributing to the achievement of my goals?” If my goal for this week is to make let's say £1,000 then is what I am doing right now helping me to achieve that or am I doing things because I enjoy them and they are actually adding nothing? Do you have a list of tasks which will lead to the achievement of your goal for today/this week/this month etc? If you don’t then what are you actually going to achieve this during this period? Will you succeed or will you end the period feeling frustrated because despite keeping busy you have not achieved?
So, just by way of example, if you spend hours and hours posting to forums are you absolutely certain that is contributing to the achievement of your goals? Do you do it to increase your profile and drive potential buyers/partners etc to your website; is it to help you learn, is it because you like to help others or is it a way of avoiding doing something i.e. the age old enemy of invention (action) called procrastination? If someone asked you to "justify" what you are doing (assuming you are doing something related to your business!) right now in terms of the achievement of your goal for today/this week/this month would you be able to?
A friend of mine has a framed set of his goals on his desk (which is a desk he uses purely for his online business)with the picture of the boat he wants to buy when he is successful! Every time he feels that he is starting to get distracted he looks at that framed set of goals and the boat and asks himself - is what I am doing right now going to get me on that boat?
Now that's what I call focus.
About the author:
Paul is Head of Training for a major UK Charitable Organisation. He owns one of the UK's Leading Information Providers PK eBooks (http://www.pk-ebooks.co.uk
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I think maintaining “focus" is probably one of the most important and the most difficult "challenges" we face when running an online business and trying to establish what will make us successful. Especially when you consider how many different opportunities we are bombarded with each and every day that can so easily distract us from what we are trying to achieve.
One of the tactics that I have found works is to be very clear about what I am doing and ensuring that what I am doing right now is contributing to the achievement of my vision/goals. So each time we do some work on our business we need to ask ourselves “What is it contributing to the achievement of my goals?” If my goal for this week is to make let's say £1,000 then is what I am doing right now helping me to achieve that or am I doing things because I enjoy them and they are actually adding nothing? Do you have a list of tasks which will lead to the achievement of your goal for today/this week/this month etc? If you don’t then what are you actually going to achieve this during this period? Will you succeed or will you end the period feeling frustrated because despite keeping busy you have not achieved?
So, just by way of example, if you spend hours and hours posting to forums are you absolutely certain that is contributing to the achievement of your goals? Do you do it to increase your profile and drive potential buyers/partners etc to your website; is it to help you learn, is it because you like to help others or is it a way of avoiding doing something i.e. the age old enemy of invention (action) called procrastination? If someone asked you to "justify" what you are doing (assuming you are doing something related to your business!) right now in terms of the achievement of your goal for today/this week/this month would you be able to?
A friend of mine has a framed set of his goals on his desk (which is a desk he uses purely for his online business)with the picture of the boat he wants to buy when he is successful! Every time he feels that he is starting to get distracted he looks at that framed set of goals and the boat and asks himself - is what I am doing right now going to get me on that boat?
Now that's what I call focus.
About the author:
Paul is Head of Training for a major UK Charitable Organisation. He owns one of the UK's Leading Information Providers PK eBooks (http://www.pk-ebooks.co.uk
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Home Cleaning Business Plan
by: John O'Callaghan
Copyright 2005 John O'Callaghan
Until about 10 years ago, business advice guru’s used to say that the best business to be in was the one you knew most about!
That statement is disputable. And, even if it were true then, it certainly is not true today! Here’s why:
No matter what skills you have or what trade or profession you are in, the amount of money you can earn is severely limited by the number of hours in the day you can work. Aha!
So now we can say:
A better business is one in which you can recruit and train others to do what you can do. This leaves you free to manage and grow the business,
Even so, we still can’t say that it is best business to be in. We can’t say it because some trades and professions have much higher billable hourly rates than others.
Copywriting, and especially direct-response copywriting, is undoubtedly one of the highest paid professions in the world!
Copywriters tend to be pretty smart. A copywriter and an attorney are discussing fees:
Lawyer: “My fees start at $150 an hour.”
Copywriter: “I charge from $1 a word.”
Lawyer: “Wow! I can't think of any word worth a $1.Gimme an example?”
Copywriter: “Gimme a $1.”
Lawyer: “Okay. Here's your $1.”
Copywriter: “THANKS!”
So, is copywriting the world’s best business to be in?
I say NO!
I say Info-Marketing on the Internet is undoubtedly the world’s best business to be in!
It doesn’t necessarily have to be an e-book that reveals copywriting
secrets and a list of words that sell. Although that would sell well to a
business-2-business market. But it does have to be an info-product that’s designed to satisfy the needs and wants of a specific niche market.
Simple, huh?
Well, not exactly. If it were that simple, everybody with a how-to info-book and a direct-response website would be rich.
As I see it, only about 5% of Internet sites make millions. The remaining bunch of hopefuls is still struggling.
Jeff Walker, Product Launch a leading Internet marketing expert, says:
“Everyone has heard the story of the Internet being paved with gold... but only a precious few are bringing home that gold. There are thousands of websites that won't even break even. Most of those sites are moribund... sitting there with products that don't sell. They will wither away, and then get blown off the Internet like some dried-up piece of tumbleweed.”
Internet marketing expert, Cody Maya, Private Label Books, says,
“The average cost of a copywriting project is $5,000--and that’s just for one sales letter. You need three things to succeed on the Internet:
#1. You need a great product.
#2. You need to be able to get traffic to your site.
#3. You need to be able to convert those prospects into customers.”
Internet marketing is great. It is not cheap. It is not easy and the learning curve for the average Joe Schmoe is mind-boggling.
It takes a high degree of sophistication, and a lot of money to buy the kind of tools that will enable you to put your business on Auto-Pilot, “while you lie on the beach in Hawaii with your laptop and make a ton of money even while you sleep.”
Yanik Silver, one of the top guns in Internet Marketing told me he spent nearly $50,000 (a ton of money) on new products and doing research last year!
So, I need to qualify what I said earlier about selling an info-product on the Internet. Here’s my revised statement:
“Selling an info-product on the Internet to a well-defined niche market is the world’s best business to be in--for those who know what they are doing and have the money to do it.”
So, you can’t just fly into flying.
You think big but you start small!
You have to learn to walk before you can learn to run!
Some 30 years ago, self-made multi-millionaire Joe Karbo stated a very simple truth:
“Most people are too busy working to make
a living to ever make more than just a living.”
In his book, “How to Be Rich,” the late billionaire J. Paul Getty said that the only way to get rich is to start your own business and work at making yourself rich, rather than your employer!
For over 20 years I have been searching to find an “idiot proof” business that could be launched by the average Jack or Jill--and with no previous business experience and little or no capital to invest.
I managed to identify seven businesses that fit that bill.
Here’s my list--not necessarily in order of merit or profitability:
1. Home and Office Cleaning
2. Handy Person Service
3. Window Washing Service
4. Publishing a Local Ad Magazine
5. Computer Instruction and Repairs
6. Painting and Decorating
7. Leaflet Distribution
8. Mobile Haircutting and Beauty Service
9. Lawn Cutting and Yard Maintenance
10. Taking Care of Snowbird Vacation Homes
I have written a how-to business instruction plan for each of the above.
Here’s what I have to say about the Home and Office Cleaning Biz:
You could be your own boss--starting today!
"10 Powerful Reasons Why Home and Office Cleaning
is One of the World's Best Businesses to Be In”
1. Low start-up cost.
2. You can work part-time or full time.
Keep your day job if you have one. Work evenings and weekends. Don’t quit your day job until you are sure you can make more working for yourself than your employer.
3. No Hard Selling Involved
The service virtually sells itself because 98% of housewives hate housework so much they jump at the chance of having a “maid” come in to the do all the dirty work.
4. Unlimited Demand For the Service
Today, as more and more women go out to work, they have less and less time to do housework and look after a husband and a family. If they can afford it, they jump at the chance of hiring a trustworthy and reliable home cleaner.
5. High Hourly Rates
The standard minimum age is a miserly $5.15 an hour. The average hourly rate for cleaners is $25 an hour. That’s more than four times the minimum wage. Average means that some cleaners charge a low of $20 an hour and others charge a high of $30 an hour.
6. No Special Skills or Training Required
Either you know what to do or the house owner tells you what she wants done.
7. The Target Market is Local and Very Easy to Contact
8. Hot Prospects are Easy to Identify
People who can afford to hire a cleaning maid live busy lives. They own large homes with two or more garages. They reside in up-market suburban areas.
9. Very Simple and Inexpensive Marketing Plan
The three best ways to get new customers as regulars are:
One: Referrals from existing customers.
Two: Leaflet Distribution.
Three: Using a tested and proven telephone script designed not to sell the service, but to make an appointment to call and give a free estimate. Done right, the level of acceptance is a high 86%.
10. Unlimited Growth Potential
While you can make $1,000 a week doing two, four-hour jobs a day for
five days a week, the way to make really big money is not to do any of
the work yourself!
The trick is to hire others to do all the cleaning work.
This leaves you free to concentrate on managing and growing the business.
As the Holly Noble, owner of a San Diego based cleaning business, says,
“You can’t be soliciting new customers when you are cleaning a toilet.”
John‘s “Home Cleaning Business Plan” is a fact-packed, step-by-step,
do-it-by-the-numbers guide that tells you all you need to know about starting up and succeeding in a home-based business of your own.
While it includes a lot of his own advice on how to promote and manage
the business, the real value of the Plan is that it contains in-depth interviews with nine successful cleaning business owners who revealed their most closely guarded trade secrets.
About the author:
John O'Callaghan is CEO of Entrepreneur's Network, Inc. John specailizes in business plans for home-based businesses that can be launched with little or no money. Get 20 Start-up Tips Free. johnoc29@aol.com
Circulated by Article Emporium
Copyright 2005 John O'Callaghan
Until about 10 years ago, business advice guru’s used to say that the best business to be in was the one you knew most about!
That statement is disputable. And, even if it were true then, it certainly is not true today! Here’s why:
No matter what skills you have or what trade or profession you are in, the amount of money you can earn is severely limited by the number of hours in the day you can work. Aha!
So now we can say:
A better business is one in which you can recruit and train others to do what you can do. This leaves you free to manage and grow the business,
Even so, we still can’t say that it is best business to be in. We can’t say it because some trades and professions have much higher billable hourly rates than others.
Copywriting, and especially direct-response copywriting, is undoubtedly one of the highest paid professions in the world!
Copywriters tend to be pretty smart. A copywriter and an attorney are discussing fees:
Lawyer: “My fees start at $150 an hour.”
Copywriter: “I charge from $1 a word.”
Lawyer: “Wow! I can't think of any word worth a $1.Gimme an example?”
Copywriter: “Gimme a $1.”
Lawyer: “Okay. Here's your $1.”
Copywriter: “THANKS!”
So, is copywriting the world’s best business to be in?
I say NO!
I say Info-Marketing on the Internet is undoubtedly the world’s best business to be in!
It doesn’t necessarily have to be an e-book that reveals copywriting
secrets and a list of words that sell. Although that would sell well to a
business-2-business market. But it does have to be an info-product that’s designed to satisfy the needs and wants of a specific niche market.
Simple, huh?
Well, not exactly. If it were that simple, everybody with a how-to info-book and a direct-response website would be rich.
As I see it, only about 5% of Internet sites make millions. The remaining bunch of hopefuls is still struggling.
Jeff Walker, Product Launch a leading Internet marketing expert, says:
“Everyone has heard the story of the Internet being paved with gold... but only a precious few are bringing home that gold. There are thousands of websites that won't even break even. Most of those sites are moribund... sitting there with products that don't sell. They will wither away, and then get blown off the Internet like some dried-up piece of tumbleweed.”
Internet marketing expert, Cody Maya, Private Label Books, says,
“The average cost of a copywriting project is $5,000--and that’s just for one sales letter. You need three things to succeed on the Internet:
#1. You need a great product.
#2. You need to be able to get traffic to your site.
#3. You need to be able to convert those prospects into customers.”
Internet marketing is great. It is not cheap. It is not easy and the learning curve for the average Joe Schmoe is mind-boggling.
It takes a high degree of sophistication, and a lot of money to buy the kind of tools that will enable you to put your business on Auto-Pilot, “while you lie on the beach in Hawaii with your laptop and make a ton of money even while you sleep.”
Yanik Silver, one of the top guns in Internet Marketing told me he spent nearly $50,000 (a ton of money) on new products and doing research last year!
So, I need to qualify what I said earlier about selling an info-product on the Internet. Here’s my revised statement:
“Selling an info-product on the Internet to a well-defined niche market is the world’s best business to be in--for those who know what they are doing and have the money to do it.”
So, you can’t just fly into flying.
You think big but you start small!
You have to learn to walk before you can learn to run!
Some 30 years ago, self-made multi-millionaire Joe Karbo stated a very simple truth:
“Most people are too busy working to make
a living to ever make more than just a living.”
In his book, “How to Be Rich,” the late billionaire J. Paul Getty said that the only way to get rich is to start your own business and work at making yourself rich, rather than your employer!
For over 20 years I have been searching to find an “idiot proof” business that could be launched by the average Jack or Jill--and with no previous business experience and little or no capital to invest.
I managed to identify seven businesses that fit that bill.
Here’s my list--not necessarily in order of merit or profitability:
1. Home and Office Cleaning
2. Handy Person Service
3. Window Washing Service
4. Publishing a Local Ad Magazine
5. Computer Instruction and Repairs
6. Painting and Decorating
7. Leaflet Distribution
8. Mobile Haircutting and Beauty Service
9. Lawn Cutting and Yard Maintenance
10. Taking Care of Snowbird Vacation Homes
I have written a how-to business instruction plan for each of the above.
Here’s what I have to say about the Home and Office Cleaning Biz:
You could be your own boss--starting today!
"10 Powerful Reasons Why Home and Office Cleaning
is One of the World's Best Businesses to Be In”
1. Low start-up cost.
2. You can work part-time or full time.
Keep your day job if you have one. Work evenings and weekends. Don’t quit your day job until you are sure you can make more working for yourself than your employer.
3. No Hard Selling Involved
The service virtually sells itself because 98% of housewives hate housework so much they jump at the chance of having a “maid” come in to the do all the dirty work.
4. Unlimited Demand For the Service
Today, as more and more women go out to work, they have less and less time to do housework and look after a husband and a family. If they can afford it, they jump at the chance of hiring a trustworthy and reliable home cleaner.
5. High Hourly Rates
The standard minimum age is a miserly $5.15 an hour. The average hourly rate for cleaners is $25 an hour. That’s more than four times the minimum wage. Average means that some cleaners charge a low of $20 an hour and others charge a high of $30 an hour.
6. No Special Skills or Training Required
Either you know what to do or the house owner tells you what she wants done.
7. The Target Market is Local and Very Easy to Contact
8. Hot Prospects are Easy to Identify
People who can afford to hire a cleaning maid live busy lives. They own large homes with two or more garages. They reside in up-market suburban areas.
9. Very Simple and Inexpensive Marketing Plan
The three best ways to get new customers as regulars are:
One: Referrals from existing customers.
Two: Leaflet Distribution.
Three: Using a tested and proven telephone script designed not to sell the service, but to make an appointment to call and give a free estimate. Done right, the level of acceptance is a high 86%.
10. Unlimited Growth Potential
While you can make $1,000 a week doing two, four-hour jobs a day for
five days a week, the way to make really big money is not to do any of
the work yourself!
The trick is to hire others to do all the cleaning work.
This leaves you free to concentrate on managing and growing the business.
As the Holly Noble, owner of a San Diego based cleaning business, says,
“You can’t be soliciting new customers when you are cleaning a toilet.”
John‘s “Home Cleaning Business Plan” is a fact-packed, step-by-step,
do-it-by-the-numbers guide that tells you all you need to know about starting up and succeeding in a home-based business of your own.
While it includes a lot of his own advice on how to promote and manage
the business, the real value of the Plan is that it contains in-depth interviews with nine successful cleaning business owners who revealed their most closely guarded trade secrets.
About the author:
John O'Callaghan is CEO of Entrepreneur's Network, Inc. John specailizes in business plans for home-based businesses that can be launched with little or no money. Get 20 Start-up Tips Free. johnoc29@aol.com
Circulated by Article Emporium
Avoiding Home Business Failures
by: Srinivasan R.G.
It’s been said that 80% of all small business dies within the first 3 years. And the rest are somehow struggling along with meager revenues. Only a handful is successful. Home based business has an even shorter lifespan. Every enthusiastic home based venture starts out with a big promise, a lot of excitement and enthusiasm.
However at the first signs of trouble or a slow take off the people become panicky. Having been accustomed to regular pay check, when the money does not roll in week after week and the bank balance hits the low digits, there is a sense of panic and the exciting home business gets trashed.
My own experience tells me this happens just when you are through with organizing, setting up and the difficult transition period of reaching out to the customers, you decide to wind up the business in favor of a job.
Now here are a few tips to persevere and make a success of your home business.
Plan in advance your finances for running your family for a minimum period of 6 months.
Plan every aspect of your business – right from creating the product to final shipments - on paper. Don’t leave out anything. This is what is called a business plan. Make it elaborate and group each aspect under a heading and subheading.
Home workers need to set a disciplined work schedule. Having no bosses around or compulsions of commuting may make you take things easy and relaxed. At least for the first 6 month work as if you are in employment and put in the required hours. You can relax and cut down on working hours when you start earning enough.
Don’t procrastinate or put things off for tomorrow. Action is one major ingredient for success. If you need to do something do it today. Do it now.
It is essential to keep your motivation high. Read about the success of other small business and home business owners and learn what they did right. Duplicating someone else who has succeeded makes it easy to succeed yourself.
You may suddenly find yourself alone without the social support of colleagues and friends. Even persons you considered your best friends may avoid you if they feel you are in trouble. That is OK. You get to know who’s who in times of adversity. Learn to depend on yourself than outside support.
Be prepared to take the temporary pain and denials. Robert Kiyosaki of ‘Rich Dad Poor Dad’ fame and his wife slept in their car for a few months and lived in a basement of a friends house for many more months to achieve what they set out - their financial freedom.
Believe in yourself and keep going even if the going gets tough. The rewards far outweigh the pains and temporary sufferings. Remember the darkest hour is just before the dawn breaks out and sun rises.
About the author:
R.G. Srinivasan is a Managerial professional, Writer and Author. He writes a regular blog on home-business resources aailable at http://www.home-businessresources.blogspot.comwith online marketing tips, resources, opportunities and online promotional strategies.
Circulated by Article Emporium
It’s been said that 80% of all small business dies within the first 3 years. And the rest are somehow struggling along with meager revenues. Only a handful is successful. Home based business has an even shorter lifespan. Every enthusiastic home based venture starts out with a big promise, a lot of excitement and enthusiasm.
However at the first signs of trouble or a slow take off the people become panicky. Having been accustomed to regular pay check, when the money does not roll in week after week and the bank balance hits the low digits, there is a sense of panic and the exciting home business gets trashed.
My own experience tells me this happens just when you are through with organizing, setting up and the difficult transition period of reaching out to the customers, you decide to wind up the business in favor of a job.
Now here are a few tips to persevere and make a success of your home business.
Plan in advance your finances for running your family for a minimum period of 6 months.
Plan every aspect of your business – right from creating the product to final shipments - on paper. Don’t leave out anything. This is what is called a business plan. Make it elaborate and group each aspect under a heading and subheading.
Home workers need to set a disciplined work schedule. Having no bosses around or compulsions of commuting may make you take things easy and relaxed. At least for the first 6 month work as if you are in employment and put in the required hours. You can relax and cut down on working hours when you start earning enough.
Don’t procrastinate or put things off for tomorrow. Action is one major ingredient for success. If you need to do something do it today. Do it now.
It is essential to keep your motivation high. Read about the success of other small business and home business owners and learn what they did right. Duplicating someone else who has succeeded makes it easy to succeed yourself.
You may suddenly find yourself alone without the social support of colleagues and friends. Even persons you considered your best friends may avoid you if they feel you are in trouble. That is OK. You get to know who’s who in times of adversity. Learn to depend on yourself than outside support.
Be prepared to take the temporary pain and denials. Robert Kiyosaki of ‘Rich Dad Poor Dad’ fame and his wife slept in their car for a few months and lived in a basement of a friends house for many more months to achieve what they set out - their financial freedom.
Believe in yourself and keep going even if the going gets tough. The rewards far outweigh the pains and temporary sufferings. Remember the darkest hour is just before the dawn breaks out and sun rises.
About the author:
R.G. Srinivasan is a Managerial professional, Writer and Author. He writes a regular blog on home-business resources aailable at http://www.home-businessresources.blogspot.comwith online marketing tips, resources, opportunities and online promotional strategies.
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Using SWOT Analysis To Improve Your Business
by: David E Coffman CPA/ABV, CVA
Analyzing the strengths, weaknesses, opportunities, and threats (SWOT) of a business is a well-established tool that is widely used by academics, consultants, and advisors. Although it is a simple concept, business owners often struggle when trying to use it because it is so broad. It is difficult to determine where to start, what questions to ask, and where to focus. The obvious problems get attention while many other important issues get overlooked. SWOT analysis is a great tool, but its effective use requires additional structure.
Strengths and weaknesses relate to internal factors, while opportunities and threats cover external ones. The internal factors can be divided into five categories: management, workforce, sales and marketing, operations, and financial. The external factors are also divided into five categories: threat of new entrants, bargaining power of suppliers, bargaining power of customers, threat of rivalry from competitors, and threat of substitution.
To approach the analysis in a structured way, prepare a checklist using the categories mentioned above. Identify factors within each category that are important to your business. Under management for example, a major weakness for virtually every small business is relying too heavily on the owner. What would happen to the business if something happened to the owner? In the workforce category a factor could be employee turnover and the availability of new hires. The threat of new entrants might include the possibility of a big box retailer opening near your business. The bargaining power of suppliers and customers categories should consider the possibility of losing a major supplier or customer. Come up with several factors for each category to complete the checklist. It is important that you do not try to rate or solve each issue as you identify them. If you do, you will get bogged down on each factor and never complete the analysis.
Once the checklist is complete, you should rate each factor based on its importance to your business. Use an alphabetical scale from A to E, where A = very important, B = important, C = some importance, D = little importance, and E = not important. Next rate each factor based on proficiency (internal) or vulnerability (external). Use a numerical scale from 1 to 5, where 1 = very proficient or not vulnerable, 2 = proficient or little vulnerability, 3 = average proficiency or some vulnerability, 4 = poor proficiency or vulnerable, and 5 = deficient or very vulnerable.
The factors with the lowest letter and highest number (A5) are the biggest weaknesses or threats. The ones with the lowest letter and lowest number (A1) are the biggest strengths or opportunities.
Using this structured approach makes a SWOT analysis possible and practical for any small business. To make this process worthwhile you must use this information to take action. Work to fix the worst problems first, prepare for the biggest risks, take advantage of the best opportunities, and build your secondary strengths.
About the author:
David E. Coffman CPA/ABV, CVA has 30 years of experience working with and operating small businesses. His “Scorecard for Small Business” provides an easy to use framework to do an in-depth analysis of any small business. Information about the “Scorecard” is available at http://small-biz-scorecard.com
Circulated by Article Emporium
Analyzing the strengths, weaknesses, opportunities, and threats (SWOT) of a business is a well-established tool that is widely used by academics, consultants, and advisors. Although it is a simple concept, business owners often struggle when trying to use it because it is so broad. It is difficult to determine where to start, what questions to ask, and where to focus. The obvious problems get attention while many other important issues get overlooked. SWOT analysis is a great tool, but its effective use requires additional structure.
Strengths and weaknesses relate to internal factors, while opportunities and threats cover external ones. The internal factors can be divided into five categories: management, workforce, sales and marketing, operations, and financial. The external factors are also divided into five categories: threat of new entrants, bargaining power of suppliers, bargaining power of customers, threat of rivalry from competitors, and threat of substitution.
To approach the analysis in a structured way, prepare a checklist using the categories mentioned above. Identify factors within each category that are important to your business. Under management for example, a major weakness for virtually every small business is relying too heavily on the owner. What would happen to the business if something happened to the owner? In the workforce category a factor could be employee turnover and the availability of new hires. The threat of new entrants might include the possibility of a big box retailer opening near your business. The bargaining power of suppliers and customers categories should consider the possibility of losing a major supplier or customer. Come up with several factors for each category to complete the checklist. It is important that you do not try to rate or solve each issue as you identify them. If you do, you will get bogged down on each factor and never complete the analysis.
Once the checklist is complete, you should rate each factor based on its importance to your business. Use an alphabetical scale from A to E, where A = very important, B = important, C = some importance, D = little importance, and E = not important. Next rate each factor based on proficiency (internal) or vulnerability (external). Use a numerical scale from 1 to 5, where 1 = very proficient or not vulnerable, 2 = proficient or little vulnerability, 3 = average proficiency or some vulnerability, 4 = poor proficiency or vulnerable, and 5 = deficient or very vulnerable.
The factors with the lowest letter and highest number (A5) are the biggest weaknesses or threats. The ones with the lowest letter and lowest number (A1) are the biggest strengths or opportunities.
Using this structured approach makes a SWOT analysis possible and practical for any small business. To make this process worthwhile you must use this information to take action. Work to fix the worst problems first, prepare for the biggest risks, take advantage of the best opportunities, and build your secondary strengths.
About the author:
David E. Coffman CPA/ABV, CVA has 30 years of experience working with and operating small businesses. His “Scorecard for Small Business” provides an easy to use framework to do an in-depth analysis of any small business. Information about the “Scorecard” is available at http://small-biz-scorecard.com
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