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Everyone knows that good accounting is one of the keys to success in any business, but you should also realize that the pre-accounting and proformas which go into business planning are essential in making the decision to go into business in the first place - especially a small business. After all the failure rates in small businesses are quite high, too high in fact. If more folks would have done their homework then perhaps they may have not gone into business in the first place and lost their shirt.
This is why I always recommend smart planning and good pre-accounting. Let's have a look see at a case study. Let's take a boat cleaning business at the local marina. Is that a good business to start? Well if could be if the size of the marina is decent, there isn't too much competition, and the cost to get into the business makes for a potential respectable ROI.
After you figure out your start-up costs, and operational costs you might decide that you really can't make any money doing this type of business where you are. Perhaps the number of boats in the harbor is too small, and the capital costs are too great, or you just don't feel you can attain the customer base you need to make the numbers work out.
That's okay, it's better to know now, than to go bankrupt in the future. See that point? If you decide to go for it, and the numbers look okay you will need financing. Again, this is another reason to have great accounting and a realistic spread sheet to show the bank or potential investors, along with a mini-business plan. Maybe you can't borrow the money, if you don't have enough money saved yet, and don't have rich relatives.
Another idea might be to get a partner with the money and you provide the sweat equity, still realize that partner will want a return on their investment, and that too will lessen the amount of profits that you will take in for your hard work. If you are looking for an investor, or partner, then you will have to prepare a solid business plan to present to them.
Writing as business plan might along with a serious spread sheet can seem daunting, but it really isn't if you take it all step-by-step. You might even consider buying one of those really nifty "Business Plan" maker programs, there are several and a few you can download online, or even work on in the new world of Cloud Computing. These business plan making programs offer hints, and virtual assistance as you prepare them. Remember above all your pre-accounting proformas now are paramount. Please consider all this.
This is why I always recommend smart planning and good pre-accounting. Let's have a look see at a case study. Let's take a boat cleaning business at the local marina. Is that a good business to start? Well if could be if the size of the marina is decent, there isn't too much competition, and the cost to get into the business makes for a potential respectable ROI.
After you figure out your start-up costs, and operational costs you might decide that you really can't make any money doing this type of business where you are. Perhaps the number of boats in the harbor is too small, and the capital costs are too great, or you just don't feel you can attain the customer base you need to make the numbers work out.
That's okay, it's better to know now, than to go bankrupt in the future. See that point? If you decide to go for it, and the numbers look okay you will need financing. Again, this is another reason to have great accounting and a realistic spread sheet to show the bank or potential investors, along with a mini-business plan. Maybe you can't borrow the money, if you don't have enough money saved yet, and don't have rich relatives.
Another idea might be to get a partner with the money and you provide the sweat equity, still realize that partner will want a return on their investment, and that too will lessen the amount of profits that you will take in for your hard work. If you are looking for an investor, or partner, then you will have to prepare a solid business plan to present to them.
Writing as business plan might along with a serious spread sheet can seem daunting, but it really isn't if you take it all step-by-step. You might even consider buying one of those really nifty "Business Plan" maker programs, there are several and a few you can download online, or even work on in the new world of Cloud Computing. These business plan making programs offer hints, and virtual assistance as you prepare them. Remember above all your pre-accounting proformas now are paramount. Please consider all this.
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