Finance and Money

What Types of Finance are available to you and what best suits your business now? Getting the right type of funding can make a big difference to the success of your business. This section takes you through some of the main types including:

Using FAQs to help answer some common questions and resources for more in depth information will help equip you to manage your finances successfully, ensure your bills are paid on time and find out what help is available if you suffer from cash flow problems.

If you want to talk through your specific situation with an experienced adviser then contact your local Business Link .

How will the Chancellor’s 2006 Budget Report affect small businesses?

If you missed it you can still see the Budget 2006 report

How do I go about obtaining a bank loan?

The main source of business loans and overdrafts are the banks, although a number of other organisations now also make loans to businesses.

Your local Business Link should be able to provide information about sources of loans, including details of any local lenders.

We would also advise you to consult your local Business Link or personal business advisor before you approach potential lenders, as they will be able to help you with your application to give it the best chance of success.

How do I qualify for the grants available?

The sources and types of grant available to business are many and varied, as are the qualifying criteria. Your local Business Link can tell you about grants that may be available and advise you on whether, and how, your business might qualify for them. Advice on grants can also be sought from accountants and grant search organisations.

For more information check out the Government Grants service from the EAS or read more in our All About Grants section.

If you are hoping to qualify for a grant as a new start-up, there are a number of special initiatives around that your Business Link can tell you about – but you should not fall into the trap of shaping your business plan around an assumption that you will be eligible for a grant. When you contact an advisor about grants, be sure to let them know if you’re a new start-up.

How does equity finance differ from loan finance

Equity finance is usually a longer term investment and the business will generally not be required to make regular repayments as with a loan.

By taking a stake in your business, the investor will expect to have some say in the way the business is run and to share in the profits and future value of the business as well.

Where can I go for funding to design and develop my new product/service?

There is rarely any direct funding for such projects but it is worth seeking advice about local or regional funding available, via the government, Europe or the private sector. Contact your local Business Link operator for this and further information on funding, as well as design advice in your region.

Be specific

But make sure that you can clearly explain the status of your project and be prepared to discuss its nature in specific terms. Prepare a well thought out business plan, to present to an adviser.

Conventional routes to funding should not be discounted completely. Contact your bank for advice on what they require from the plan, and make appointments with one of their business advisers. They will discuss the viability of new ideas and inventions.

Banks can help

Preparing a well thought out business plan, based around your idea, to present to a bank business manager could reap dividends.

You can use design to improve your business through the products and services you offer, and you can double its effectiveness by planning for and using design strategically. By thinking the big design picture, rather than focussing on one single product, you can link all of the parts of your company that benefit from design and create a powerful business response that is irresistible to your customers.

This article based on information that is Crown Copyright © 2002

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