finding Start up Finance

[sidney0406]

Hi all

I am just going to cut to the chase. i am looking to buy a newsagents/convenience store and im needing to find finance. However i dont own my own home yet i have a few thousand in savings but nowhere near enough to buy the store. How easy (or rather how difficult) is it going to be for me to get a business loan for the store. I have worked in the industry for years starting in a store when i was at school then working in the head office of a large retailer since. Would this experience make any difference? Althought i dont have the accounts for the shop yet(in post as we speak) ill need to ensure i can secure finance before i proceed. absolute worst case senario the loan amount would be £70000.

Thanks for any advice

 

[jholden]

Impossible to say how easy or hard finance is to get. You have to go to the banks and ask them.

You will however be up against the credit crunch which means obtaining finance is getting harder especially in the SME sector.

To stand the best chance of obtaining finance do your homework and engage an adviser.

No bank will lend without information.

You need the recent accounts from the shop. You need a business plan even in a simple format. You need projections to prove the viability of this busines to the bank.

There is a lot you need to do before you walk into a bank, but to save time and ultimately money find a good adviser to help and guide you.

Good luck.

Jason

 

[lesliedocherty]

To be blunt, no chance.

Banks want all borrowing secured, without security, yours or someone elses you wont get it, to risky for the bank.

 

[jholden]

It is not a no chance answer.

The Small Firms Loan Gurantee Scheme is there for those with no assets.

Below is a list of SFLG Scheme member banks:
http://www.berr.gov.uk/bbf/enterpri...-owners/access-to-finance/sflg/page37617.html

As I said, engage a suitably qualified/experienced advisor to help and guide you.

Jason

 

[Shahkti]

My experience of SFLGS (Barclays) is that the Bank will at best offer matched funding i.e. if he had £35K they may offer the remaining £35K needed.

Not sure how it applies to a shop, but they also usually look for evidence of committed orders.

They are also prone to enticing you with SFLGS then switching to normal secured loan at last minute

I came to see SFLGS as a sort of bridging loan rather than early-stage investment or start-up financing. My bank relationship manager went on and on about it not being equity investment.

I'd advise a chat with the OP's local Business Link. They may know of some source of funding. I go with the sentiment that no security, no joy at the Bank.

 

[Blackberry]

You will be able to get finance but its a question of how much its going to cost you!

if you go to a bank they will want security, as you have no assets the security they will look at is what you are buying - which i suspect the bulk of it is the lease on the shop?

even if they accept this as security you may still be be deemed high risk and be charged interest at the higher rates - around 10% over base rate at the moment - so thats 15% interest in total.

You could seek out a venture capitalist to provide finance, but if you have ever seen Dragons Den, you'll know that they want a higher rate of return still.

whatever you do in order to get finance you'll need an award winning business plan stating what and why you are doing, how your going to do it and more importantly cashflows - monthly for atleast the first 3 years so people can see how you intend to pay back what you have borrowed

good luck!

 

[solutions4finance]

Finding finance for this sort of thing is never easy, but far from impossible.

The type of fnance that I arrange is asset based funding - not really the sort of thing that's any good to you. However, there are one or two advisors that we point our clients to for this sort of thing.

If you'd like me to point you in the direction of somebody then please do drop me an email and I'll pass their contact details over.

Hope it all works out for you

Best of luck

Justin

 

[Ian J]

If you'd like me to point you in the direction of somebody then please do drop me an email and I'll pass their contact details over.

Why not post the details here so that others may benefit.

It's not an area of finance that I know much about but I'm not as coy and would recommend that you talk to forum member Gillie who does have expertise in this type of finance

 

[solutions4finance]

Ok... contact, in the first instance, David Brown on 07885 487 657.

David has just helped one of our clients in a start up situation to buy an existing business.

Best of luck

Justin

PS. Didn't want to post details for fear of persecution following the last time with comments from another forum member who shall remain nameless.

 

[imran999]

Sorry to jump in on another users post, but i am interested in getting some finance thru asset based finance.

Currently in development stages of setting up a new food business (as part of a franchise), costs of equipment and store fitout would total around 60k-70k+vat.

I am told that via Asset finance, i need only secure the finance on the premises+equipment itself and i will not need to secure my house to get the funds.

What kind of rates would i be able to get and over how long a term?

 

[lautonfunding]

imran999,

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