Article Contributed by Samantha Peters
Starting a small business is an exciting time. With hard work, careful planning and dedication, small business owners can create a rewarding, and potentially lucrative, job that prepares them for the future. There are considerations that must be taken into account, however, and financing is near the top of the list.
Start-up Funding and Planning There is a substantially high up-front cost when starting most small businesses. Whether it is office space, equipment or computer systems for current and future employees, the cost required may be out of the reach of many. For those who do not have the funding available, banks may be able to offer a loan if the owner has collateral to put up and a solid credit history. Another option that is becoming popular is seed money. By asking family, friends and other contacts, a small business owner might be able to acquire the funding necessary to start offering their products and services.
Most who are starting a small business have considered the “big picture” financing requirements and have a basic plan to get started and begin turning a profit. The small details, however, are often not fully considered. By carefully planning and making conservative projections, a small business founder can plan his or her first few months or years of business. By keeping a realistic mindset about the initial and recurring costs, the small business owner can be confident that he or she is ready for any setbacks.
Day-to-Day Financing Paying bills, employees and suppliers can be an overwhelming task that many small business owners are not fully prepared for. The time required to do all of this work manually can be much greater than many expect, and new owners need to be spending their time ensuring that customer relations and other facets of the new business are handled appropriately. Fortunately, software and online services are available to help ease this task.
Merchant services are a collection of services that allow businesses to handle a variety of the tasks necessary to ensure smooth operations. Credit card processing, for example, was traditionally a hassle that new businesses had to carefully plan for; today, new, Internet-based companies allow a business to begin handling credit cards quickly and easily. Some merchant services providers also offer point-of-sale software and equipment that allows the business to have a storefront appearance on par with established businesses. Marketing services may be available as well.
Financial Logging and Analysis A new branch of software and online services is allowing businesses to automate many of the financial aspects of their businesses. Enterprise resource planning (ERP) software gives businesses a suite of tools through which they can handle many of the aspects of their businesses activities. Automatic accounting tools save considerable time during businesses hours and around tax time. These programs can also handle inventory management and plan necessary purchases. Customer relationship management (CRM) software stores information about customers and helps with marketing activities. If a business needs to provide technical support, CRM software has tools that can help.
All of these programs give small businesses valuable analytical tools. Early projections are almost always wrong in some ways. No matter how sound a business plan is, accounting for the small things that affect the bottom line is fraught with unknowns. Being able to instantly analyze ways to improve upon operations can save a business or lead to better profitability.
Entrepreneurship helps drive the economies of developed nations. Done properly, it can be one of the most rewarding career paths. At the end of the day, however, financing is the key that can lead to success or failure. With careful planning, flexibility and the right tools, a small business owner can greatly enhance his or her likelihood of success.
About the Author
This is a Guest Post written by Samantha Peters, an avid blogger who lives on the internet. She covers education and business topics at TheEducationUpdate.com but can write on anything from office chairs at sitbetter to political news.