management Money!


Show Me the


Every small business needs fuel— capital—to run on, including yours. Just where do you find it? Here’s a rundown. Starr Cumming


Y 114


ou have the right products, the right location and are ready to launch (or expand) your specialty retail business. But you are not going to get anywhere without capital—both to get the business started and to keep it running.


The economic downturn has had entrepreneurs


looking for alternative methods of financing in addition to the tried and tested ones. The new Small Business Jobs Act, passed in September, promises to help. It will provide critical resources to help small businesses continue to drive economic recovery and create jobs. The new law extends the successful U.S. Small Business Administration’s enhanced loan provisions while offering billions more in lending support, tax cuts, and other opportunities for entrepreneurs and small business owners.


Begin with the basics Creating a business plan is one of the key first steps to starting a specialty retail business. You can find many business plan templates online. A business plan will help you determine how much capital


you will need to start and keep the business running. The loan amount you apply for will depend on these numbers.


Specialty Retail Report n Winter 2011


Consider consulting a certified accountant or attorney who specializes in tax laws. Advice on how to set up your business— as sole proprietor, LLC, etc.—will be useful at this stage. Each of these entities has different tax and liability implications and will affect your cash flow. Doing your homework and research in the beginning will ensure that the business will not be strapped for cash later. In addition, you will need to complete a personal financial statement and business financial statement (if applicable). You can find these templates online as well. These forms are required to process loans and some landlords require them too. Landlords want to know that the business has capital and is financially stable. Sometimes, even if you have incorporated your business, the landlord may still require a personal guarantee to the Lease or License Agreement. A personal guarantee is a promise made by an entrepreneur to personally repay the company debts in the event of default by the business.


Where to look for advice Non-profit associations dedicated to educating entrepreneurs and helping small businesses launch, are great points of contact. The U.S. Small Business Administration website has a wealth of


SpecialtyRetail.com


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