Do you have a good idea for a new business?
The idea is just the first step.
Most financial advisors will ask you the same thing -
"Do you have what it takes to run a business? It’s one thing to have a really great idea but it’s another thing to know, internally if you have what it takes to run a business. There’s a lot of stresses involved with it,” said Galileo Tan of Central Pacific Bank.
Beginning a small business requires patience especially at the start. And you need to be certain about what it is you want to do.
"What type of product or service is it that you plan to provide to your customers and how different is it from others within the community that may offer similar products or services. In other words, how are you going to differentiate yourself from everyone else. And last but not least, what is the demand for your product or service?" said Tan.
If you are headed to the bank to get a small business loan, it’s always a good idea to have a business plan in hand.
Lenders want to know what you have in mind.
"So a business plan illustrates how the business will be operated. If there’s more than one owner, what are partners liable for and also, when it comes time to apply for financing…when, how and where do they go when applying for financing,” said Tan.
Finally, whether you are the sole owner of the business or working in partnership with someone else – lenders want to know you are committed to the endeavor.
In other words, they want to know if you have invested your own capital in your new idea.
"Ideally, it would be great if a business owner would have their own capital, to start the business with because it shows a positive reflection on themselves that they’re already risking their own funds for the business, meaning that’s how strongly they feel about the business,” said Tan.
See the original article at: KHON2 Local News
