divided between the partners, with the
potential for personality conflicts to set
in.
Of course, your business plan
will not be complete without a
thorough breakdown of all costs,
whether start-up or operational, and
how those costs will be met. You’ll
need to account for everything from
equipment, inventory, and payroll to
rent, taxes and marketing. Include all
planned funding sources, from grants
and subsidies to loans, equity, or lines
of credit.
When you think you may be
done your business plan, consult
professionals like accountants and
experienced business people for
8
yourBusiness
constructive criticism and to find out
if you’ve overlooked anything. The
more detail you can provide, the more
confidence you’ll inspire in lenders
and investors when you seek out
financing.
Financing for your business can
come from a variety of sources.
Banks, trust companies and credit
unions can help with short-term loans,
long-term mortgage loans, or perhaps
loans against inventory or accounts
receivable. For smaller businesses,
such as a home-based business, lines
of credit may suffice, although interest
rates may prove prohibitive. Venture
capitalists may want to invest in your
business, but this tends to involve
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them acquiring a percentage of your
company, including participation in
decision-making.
There are also many grants and
subsidies available to small and
medium sized businesses. The
Canadian Small Business Financing
Program, for example, provides
financial institutions with government
loan guarantees up to $500,000 for
business with annual gross revenues
up to $5 million. These loans can be
used to cover up to ninety percent of
the costs to purchase or improve land;
purchase leasehold improvements or
improve leased property; or purchase
new equipment or improve old
equipment.