hello and advice

[timberdog]

Hello all

I live in Nuneton and i am thinking of seting a small buisness ASAP.

Not sure what to buy conciderations so far are up and running small news agents with lottery etc or pet supplier shops as i like animals etc.

The main reason for ststing up is first and foremaost i want to be my own boss and the Green stuff IE money apeals!!

But in saying the above i am not greedy and just want a comfortable life.


I would like the idiots guide i know you must think of what money you would need to survive if you pack up work which makes sennse but were i am confused or thick is how does leasehold work?? what does it mean i rent ?? own ?? what???.

Also if i bought outright say 180.000 how do you get a mortgage for shops what is involved?

I am green to this and would like any constructive advise


and last of all can anyone recomend profitable small buisness of any kind?


Many thanks

Tim

 

[10Yetis]

Tim, first off... welcome.

Second, we have all been at the stage you are currently at and asking for help is the first great leap forward.

You should try your local business link for a load of answers to your questions (look up "business link nuneaton" in google). Also, there are people on here who can help you out, for example, Ozzy can advise on forming a company and ASmoore has loads of useful stuff on his website for people new to the world of having you own business... as well as accounting and more importantly he acts as a kind of business mentor to help your company grow and succeed.

Of course, If i can be of any help whatsover, give me a shout.

 

[Ozzy]

Hi Tim,
Welcome onboard.

To cover Yeti's comment about setting up a company, my wife used to own a shop and to be honest a newsagent sort of business would be fine as a sole trader type setup .. not that you asked this question!

As for how much money is needed, I would suggets starting out with a business plan. BusinessLink do offer help with things like this, aswell as some members on here also. This will help you work out how much money you need to make to break even and then eventually make a profit ... not least how much money you may need to get started.

A lease is similar to rent, in that you do not actually own the property. The easiest way I can think of describing it is that you "buy" the property for X years and you cannot be kicked out within that time so long as you dont burn the place down on purpose or similar. You can sell the remainder of the lease on at any time, but if the new "owner" fails to pay the landlord can come back after you for the money.
At the end of the lease period you have to renew it with the landlord or move out.
Rental is basically no fixed term, stay as long as you like fiving X months notice when you want to move out. With leasing you are there for the length of the lease unless the landlord allows you to "buy your way out".

Leasing enables you and the landlord to plan long term, as usually leases are for around 10+ years. Rental is more flexiable for both sides.

 

[Paul Shepherd]

Hello Tim and welcome,

The advice so far regarding business link is excellent. They will give you a lot of valuable advice and help.
Another tip-- research, make sure there is a market for the type of business you want to set up. If an existing business, get a professional to look at the accounts to verify it is a viable business.
Have you considered a franchise? There are alot out there!
When it comes to financing your business the obvious place to start is at the bank but don't rule out finance consultants who have access to other lenders that specialise in start up companies There are a few of us on this forum.
Good luck with your venture.

Paul Shepherd
25-7 Business Finance

 

[VeryMark]

My own personal suggestion is to visit your local BNI group (see www.bni-europe.com) as you will find other small businesses who will be able to help you with advice.

 

[SillyJokes]

You will also want to make sure that you have a market before you do something and not just build your business on a hunch that people will also like animals.

If you can find out what it is that people really like about animals you will be able to help them and make your business more attractive than any other pet store in the town.

 

[MarkD]

Hi Tim,

whatever you choose to do I suggest you do something you will enjoy and are enthusiastic about, do your market research & make sure you are in the right location. This will give you the best chance of success.

As for leaseholds, heres it put very simply.

There are leaseholds such as flats that you buy that may have many years to run e.g. 99+ that have automatic rights to renew for a small fee that to all intents and purposes are just like buying a house but you cannot buy the land as it is shared with the other owners.

But in your case, for say a shop, you may have to buy a relatively short term lease plus pay rent. The price of the lease will be determined by the length of the lease. Your first port of call to raise finance for such a lease should be your own bank.

 

[Deleted member 2816]

Hi Tim

There is a shop currently to rent near to where I live in Cov - landlord is just finishing redecorating. It's on a corner (easy parking) & would be the perfect place for a pet shop as there are loads of animal owners round here, specially dogs. (Not so far from Nuneaton.) Just an idea.

 

[Mark Powell]

Hi Tim,

There are a couple of questions you need to ask yourself before starting out on your own.

Why do you want to start your own business? You mentioned being your own boss and money. Well what do you mean by that. Do you want to be your own boss so that you can decide when and how much you have to work or to have more control over what you do? If you start out on your own you are likely to be working much harder then ever before and initially you are likely to have less money than you currently do.

What kind of business would suit you? To be a success on your own you need to be passionate about your business. Putting in long hours into your own business is easy if you love what you are doing but putting in long hours into your own business just for the sake of it is just another job. Find something that you love doing, that you will even enjoy doing 18 hours a day.

Can this business work? A business plan is essential, you can only run your business if you have enough custom to keep it running. Where will you make your money, how much do you need to sell in order to make money, where will your customers come from?

If you get the right answers then running your own business can be incredibly satisfying and rewarding.

Hope this helps.

 

[timberdog]

Mark D

Can you explain to a idiot or lets say green to this thing called leasing!!

look at this example that was advertised this is not what im looking for just an example of what i mean:


WARWICKSHIRE
£130,000 Annual Turnover


£27,450 LEASEHOLD


--------------------------------------------------------------------------------

PET FOOD & SUPPLIES busy parade serving good densely pop resid suburb nr NUNEATON secure spacious rented l/up superbly ft'd T/o £130,000+pa & rising GP25% young expanding concern run single handed with growing rep & customer base & lots of further potential in ideal location with early viewing ess at LEASEHOLD £27,450.REF A4752


my first question is am i calculating the clear profit right by saying £130.000 pa x GP of 25 % = £32500 pa profit??.

Now the thing which i struggle with the lease am i right in saying lease @ £27,450 is this PA as i hve worked out this would be £2287 per month if so??

But am i missing this is it for two years ??? as with £32500 profit divided by twelve months this would be £2708 per month which is about what the lease would be per month??? pr is the the lease over two years??
Confused .

Any way as it turns out the newsagents i was interested in is up for sale freehold for £250.000 which includes accomadation above shop.

i am due to view this with no committment on Friday and if it looks ok i have been promised a copy of his books.
He tells me his turnover is £250.000 PA with GP of 17% which would give as i work it out as £42000 clear profit aside from odds .

My problem is now i will either have to get a buiness mortgage for £250.000 which means i am told i will have to raise a deposit of 20 to 25 % = £70.000 which may i add i do not have .
I only have £40.000 cash available from sale of my house this creates obvious problems IE shortfall of deposit.

I learned today that this may not be the case if i can find out the following information based on this being a residential property as well as a buisness:

How much of the property is goodwill and how much is bricks and morter and depending on how this buisness is made up of the above may tipp the balence in my favour by lowering the amount of deposit involed.

Can you tell me if his is true???
And also if it would be better concidering i may not be able to raise £70.000 deposit to go for leasehold on another buisness?

Or i could go for a buisness worth £180.000 which means i could get a could then afford a deposit??

Help please or anyone on line who is a finacial advisor who could help?

ps any questions which i should ask when viewing please pass comment.

Tim