June 2015 - First 4 Commercial
11Jun2015

The top 5 sectors for start-up loans

The past 12 months has seen a definite increase in business requiring start-up funding. The UK has seen a massive rise in female entrepreneurs and women in employment is now at a record high therefore explaining why the fashion and beauty industry is one of the largest sectors in start-up funding.

  1. Fashion and Beauty start-ups – skin and hair products had increased sales even in economic downturn. These business’ have a relatively low cash entry barrier and low set up costs. It is a scalable business and fits in well with women who want/need to work but are also looking after their families.
  2. Creative business – With popular TV embracing creative pastimes, such as cookery, make and mend and budget saving crafts, what have been traditional hobby areas have now becoming venture ideas. Many people are wanting to work in a business they are passionate about.
  3. Business service start-ups- Ventures that provide services to other business are also popular. Finding a niche and gap in the market is the starting point for these start-ups. This often comes from working in a particular industry and realising that there is a service that could/should be provided that isn’t.
  4. Cottage industry start ups- Food markets and festivals have shown a popular rise in consumers wanting to buy products from local sources with localised production.
  5. Technology start-ups- This sector has expanded recently with UK technology firms doubling over the last three years.

Start-up business enable job creation, so encouraging entrepreneurial spirit is important to in turn provide growth in our economy. Having a great product or service, employing the right people, pin pointing the unique elements to your business that set them aside from others, sticking to deadlines and being able to sell your products are all key to a successful business that will flourish for years to come.

11Jun2015

4 top tips to consider before apply for business finance

A bank is one of the first ports of call for any business needing start-up finance. Securing a loan is something that is both stressful and often confusing. Which bank offers the best rates, security, producing predictive financial forecasts are amongst the many questions trailing through your head and onto paper, when setting out the step by step process of launching a new business. Detailed below are some important elements to consider.

  1. Correct preparation – creating and presenting a business plan that has strong financial forecasts and a coherent way forward is vital when approaching a funding source. This plan will be the show case document that proves whether or not a business is viable or not.
  2. Details to include – what your business model will look like, the growth of your business, how this will happen and where you want it to be in the long term. Who are your competitors? What are your business objectives and how will you achieve them? How much money do you need and what will it be used for?
  3. Costs- Its important not to start a business under-capitalised, the costs of set up, equipment and materials all need to be factored in as well as the costs of employees, not forgetting yourself.
  4. Security- The business plan needs to show that the capital that you are wishing to borrow can be repaid over a given time frame. You will also need to include details of any security that you can offer to lenders, this could be either personal or business assets or both. So cash-flow, profit and loss and sales forecasts for the coming five years are also requirements of a business plan.
2Jun2015

5 Reasons NOT to Apply for a Business Loan

5 Reasons Not To Apply For a Business Loan

Every day small, medium and large business owners make the decision to take out a commercial loan, but they do not always think this through correctly. This article looks at 5 examples of when you should probably not ask for a loan and should probably do a little more research first.

Reason One – You are Not Ready

Think hard before you commit yourself financially because many new business ideas are based on current trends and by the time you have your funds in place, the next fad will already have come and gone.

Reason Two – You Owe Too Much Money Already

If your cash flow is already run down due to being maxed out, taking on more debt really is the last thing your business needs right now. Try to clean up your credit issues first because you are probably going to outreach your resources before too long.

Reason Three – Impulse Buying

Okay, that flashy new product may look absolutely fabulous in your office or showroom but do you really need it? If all of your assets are tied up in repaying the loan, how can you make the most of your opportunities when they finally arrive?

Reason Four – Read the Small Print

When you come across a business loan rate that looks too good to be true, it probably is.

Reason Five – Consolidation is Not Always the Answer

Taking out a loan to repay smaller debts may seem like an astute idea but if you are struggling with these repayments, how will you cope with a larger one in the long run?

Try to look at these 5 examples before you decide to take out a commercial loan next time; you will be glad that you did!

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