The Economy and Your Business Plan

There is no doubt that the issues on Wall Street and the credit crunch is having an affect on businesses nationwide and across the globe. I am repeatedly asked by entrepreneurs about the ramifications by both existing business owners and those with a startup business seeking capital. The initial response always begins with “don't panic…” and that depends on the business and region of the country, as the current economic crisis has different implications depending on the type of business and funding needed, which generally fall into two categories:

Debt – Business owners and startups alike are clearly facing varied regional difficulties in borrowing money to expand or start up businesses. Notwithstanding, opportunities do exist, with an SBA guaranteed loan being one that should be strongly considered at this time. Our team has a depth of SBA experience and can find the right lender with a track record that suits you in your area.

Equity Investment – My recent discussions with VC and private equity sources clearly indicate that there is little change in their capabilities for equity investments. Private equity and VC investors focus on small to mid-sized companies, not public companies that are taking such a bit hit on Wall Street. They have the capital and continue to invest that capital on viable ventures.
All businesses are unique in their needs, expectations and considerations of how the economy affects them. Therefore, we remain available for a free consult in this regard.

Executive and Key Employee Teams that Fit the Plan

The larger the Business Plan, the more depth of senior management that is primarily experienced in the service(s) or product(s) being offered is a must। Principals that venture into new business territory need to ensure that most members of the team have this direct industry experience. One of the most important considerations for all investors is the quality of leadership in new and expanding business ventures.

If your team is incomplete or not quite right for your venture, a team of experienced Business Plan consultants like our Company can help.

Avoid Upfront Fees When Seeking Capital

We are wary about upfront fees from proven institutions and never suggest that brokers, finders or even consultants such as us, consider upfront fees to review a Business Plan or to seek funding for that Plan. In addition, NEVER agree to exclusive agreements when it comes to obtaining the capital you seek, unless it is with the investment or lender with a very clear conditional commitment for funding. Do not fall into the trap of believing great references on closed transactions, and ask yourself if this company took 100 fees to close three transactions.

Many years back, as a Principal, I discovered after-the-fact that an investment banking firm of substance, with over $100 M in closed, verified transactions in a year possibly closed one in 20 transactions at best!
In conclusion, be careful and know there is a large universe of interested investors for large plans whose priority is to fund viable business plans and not collect upfront fees.

Detailed Marketing Plans are a Must!

Existing and Start-up Business Plans alike, usually require a detailed marketing plan that should have many different marketing directives, led by a very experienced sales and marketing team. Marketing Plans should include specific references to the resources to be utilized and be comprehensive, almost always including a quality Web site to reflect quality product(s) and service(s).

Small to large business plans like those we receive from prospective clients, typically fall far short in the required depth of the marketing plan, let alone a sufficient marketing budget or marketing/sales leadership to justify the revenue assumptions.
These are areas with which an experienced Business Plan team and marketing experts can help.

SBAExpress Loans an Option for Many!

The maximum loan amount is $350,000, and the maximum SBA guaranty is 50%। This is sufficient for many start up ventures.

Lenders and borrowers can negotiate the interest rate with a local bank. Rates are tied to the prime rate (as published in the Wall Street Journal) and may be fixed or variable, but they may not exceed the SBA maximums. Lenders may charge up to 6.5 percent over prime rate for loans of $50,000 or less and up to 4.5 percent over the prime rate for loans over $50,000. Lender uses mostly its own forms and procedures. The credit decision is made by the Lender, and the turnaround time is 36 Hours or less.

The Lender is not required to take collateral for loans up to $25,000. The Lender may use its existing collateral policy for loans over $25,000 up to $150,000. For Loans greater than $150,000, the Lender must follow SBA's general collateral policy.

We always offer a free consult to business owners and entrepreneurs on this option and others to expand and start up worthy ventures.

Your Business and a Green & Sustainable Econony

After a couple generations of wasteful policies in many areas highlighted by an energy policy that increased oil imports nearly threefold in that time, collectively, our citizens, and hopefully the politicians, have realized that sustainability of our society and lifestyle are intertwined in eco-friendly, energy and collective economic policies. Then there is a questionable war fought by admirable young men and women that have barely read of a place called Vietnam in their only a couple years removed history books, a current war primarily financed by borrowing from foreign governments. Gas prices offer no relief, food and commodities inflation is run amuck, and the mortgage and real estate market crises have terrible effects to many millions of our citizens.

Within this framework, you likely ask yourself if this is a good time to expand or start my business? The answer is a resounding YES, depending...on the business, the location, your experience and abilities. Same answer like during a great economy you say, and yes in general, but in these times the type of business is more critical, like green and sustainable ventures, the unwavering thirst for new tech and its applications or a Web-based business, let alone a business focused on addressing basic human needs beginning with food, shelter or health care. Being self-employed presents risks but not more than being employed in an economy seeking stability, but potentially greater rewards to maintain or seek that proverbial American dream.

Financial Independence Day

We must celebrate and be thankful on an ongoing basis for the opportunities we have in the US, and in democracies and in a capitalist societies worldwide that presents financial opportunities for those that work hard, have great ideas and persevere.

The opportunity for financial independence is greatly magnified for those that are in their own business, providing they respect the delicate balance of their own ideas and efforts with the need for important team members such as consultants or key employees in business development like business plans professionals, marketing, operations, financial advisory and counsel. Our team approach helps us address these areas with your other team members so you can achieve the type of independence available despite a soft economy.