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Analyse the guidance available to a potential business to ensure a successful start up and nancial support

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Introduction

Transfer-Encoding: chunked I am working for the Hounslow Chamber of Commerce as a trainee manager. The Hounslow Chamber of Commerce provides advice to existing businesses and to entrepreneurs seeking to set up their own businesses. In this guide, I will analyse the guidance, advice and support available and what action a potential business should take to ensure successful start-up and financial support. I will analyse why the actions are necessary, what they facilitate and what problems might arise if the stages were ignored. The first important stage when setting up a business, is to decide what type of ownership you want to be. Do you want to be a sole trader, partnership, private or public limited company or a franchise? It?s also important for the owner to understand that each separate ownership has different disadvantages; these arise when the owner is unaware of the disadvantages beforehand as they didn?t do prior research. Problems can arise for sole traders and partnerships when they get into financial debt, for example being unable to pay their accounts. In a result they have unlimited liability and the owners personal assets will be sold to fund the debt. In addition, obtaining finance to start up a sole trader or partnership may be difficult. The reason for this is because you are a new business and do not have a history of success. ...read more.

Middle

Furthermore, it?s important to have a contingency plan. If a problem arises and there isn?t a plan you won?t have reserves for problems that may occur. For instance, if machinery breaks down and there is not a contingency plan or reserve fund, the business may not be able to operate as they won?t have the funds to repair or replace the machinery. Lastly, it?s important for the business to consider online operations. The majority of people prefer to shop online as it is easier and more convenient. Therefore, if the business doesn?t provide an online service for customers to buy their products they will be loses a lot of sales as customers will go to their competitors who do sell online. If you move markets, for example, local to a global market it may lead to problems. If a business is operating in a different country, there may be different laws and regulations that you need to follow. Therefore, it may cause issues as you will have to abide by the laws in order to operate. Also operating in different markets may lead to problems if research is not done effiecently. Therefore, if research on products and customers isn?t done well it may lead to less customers as products may not be suitable for the particular area. ...read more.

Conclusion

There are many ways in which a business can gain initial finance. The business owner has a range of different sources of finance. However, some of the methods they may use to gain the finance contain an element of risk and some may be risk free. If the business owner uses a mortgage to gain a property you will have to pay interest. This interest can vary; you can have fixed or variable interest or interest only, or interest and repayment mortgages. If you don?t pay, your property can be repossessed. Also, if loans and overdrafts are used as ways to gain finance the business will now have to pay lots of interest which reduces the amount of money on other things such as raw materials. Furthermore, credit cards may be used and also have high amounts of interests which could put the business in more debt. Moreover, the business may make use of angels, dragons or venture capitalists and they now own a certain percentage of the business which means you will have to share your profits with them. In addition, if you don?t meet the criteria for investment, nobody will want to invest in your company for instance, when obtaining a loan, overdraft or being invested by venture capitalists. There are many steps needed to happen when starting up a business. If these steps are not completed efficiently the business won?t be able to operate successfully. ...read more.

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