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How to Start a House Cleaning Business on a Tight Budget

Friday, April 8th, 2011

“If you use Emotion and Love to drive your sales and your business, you will create Loyalty Beyond Reason. And I promise you, you will build relationships and enjoy a business that exceeds beyond your wildest expectations”

First of all, before you decide to start your cleaning business, make sure this kind of work is right for you. You will need to be in good physical condition. Cleaning is very hard strenuous work. You will need to have good customer relation skills. You will need to have basic office skills and some accounting skills.

If you are planning on leaving your full time position to start a cleaning business, make sure you have at least six months of savings. Or keep your full time job and start out part time.

Research all the aspects of the cleaning service business. From customer service to advertising, taxes, employees, insurance and bonding, what to charge and how to clean a home professionally. Cleaning your own home and cleaning professionally is totally different. Learning how to clean professionally takes a lot of time. When a client pays for your services they expect to come home and find their home spotless.

Getting those first clients takes time, persistence and patience. You will not get a hundred clients overnight.

Obtaining Those First Clients The hardest part of starting your own cleaning service is obtaining those first clients. Most clients want to know how long you have been in business and want references. The best thing to do is let clients know that, yes, you are new to the business but that you have thoroughly researched all aspects of the cleaning business and assure them that you know what you are doing and that you are quit capable of cleaning their home to their specifications. Be confident. I can’t stress this enough. Clients love to see confidence. It relieves their worries and lets them know that their home is in good hands.

References: To get a few good references when starting out, ask some friends or family members if you can clean their home for free or at a discounted rate. The sound of working for free may not be appealing but it will be worth it to get some good testimonials.

When cleaning those first homes, go for quality, not how fast you can clean the home. Cleaning efficiently takes a long time, but you will get to the point where you can do a thorough cleaning in a short time. After cleaning make sure you go back and double check all rooms to make sure you didn’t miss anything. Impress those first clients and word of mouth will spread soon.

Advertising Your company image is everything. Before you start advertising, decide what image you want to portray on your advertising material. Your image is very important. Be consistent with all your advertising. If you have a logo be sure to use it on all your advertising materials. I think it is best to have a website developed before you start advertising. When advertising, stick with the same logo and colors.

Advertise in Local Paper: Start by running a text ad in your local newspaper. Try to come up with an eye catching ad. Do not sell your services on low rates, sell your services on your quality of work and what you can do for the client that other companies don’t. There is a lot of competition in the cleaning service. You have to stand out from the rest.

Magnetic Signs or Lettering for your Vehicle: Having your business name and contact information on your vehicle is a great way to advertise. We use the vinyl lettering. The lettering looks much more professional than the magnetic signs.

Flyers: You can print nice flyers on your home computer, but I would suggest investing in some professional flyers. Hang flyers at Hair Dressers, Laundromats, Restaurants, Bakeries, Grocery Stores, etc. Put flyers on car windows at local groceries stores and businesses. You can even go door to door in neighborhoods you would like to work in. You cannot put them in mailboxes. but you can put them in the front door.

Door Hangers: Door hangers are a great way to get new clients. Pick the neighborhood you would like to work in and hang the door hangers on the doors. When people get flyers or ads in their mailbox they usually throw them away with the junk mail. But if there is a door hanger on the door they will take the time to look at it.

Business Cards: Start passing out your business cards to friends and family members. You can also ask your local businesses if you can leave some cards on their counters.

Referral Program: A great way to obtain new clients is through a referral program. Offer existing clients a discount when they refer a friend. You can give your existing clients a discount when the friend uses your services three times.

Website: These days people live very busy lives so they use the convenience of the internet to shop for the services they need. A lot of working women will shop for services while at work. Everyone that has a business should have a website. It shows clients that you are serious about your business and allows them research your business in their own time.

Cleaning Products: By using all natrual products, you can offer your clients a healthy cleaning experience and protect ourselves against harsh chemicals. Clients love the natural cleaning products with essential oils. They come home to a healthy clean home filled with the wonderful scents of aromatherapy essential oils.

Tip: Always carry hand sanitizer and wash your hands often while cleaning homes. Wear gloves when cleaning bathrooms. You will be exposed to a lot of different germs in clients homes.

Remember most customers prefer that you bring your own cleaning supplies. That way they do not have to worry about going to the store for cleaning supplies before you clean. Some customers have special cleaners for certain appliances or floors in their houses. These customers usually will have these cleaners on hand for you to use. We almost always use the customers vacuum cleaner. That way you do not have to carry a heavy vacuum from house to house.

What to Charge I mentioned earlier that you should sell your services on your quality of work and not your low rates. If your rates are too low, clients will think that your work is sub-standard and that you are not experienced. Also you want to attract the clients that can afford your services. I made the mistake of pricing my work too low when I first started out. Cleaning is hard work, charge what you are worth. As the old saying goes “You get what you pay for.”

Some companies charge by the hour, some charge by the room, some charge a flat rate per home and some charge by the square foot. I think it is better to charge by the home, not by the hour. If a client knows they have to pay one set fee, they don’t care if you take 2 hours or 5 hours. Also your clients will know what they are paying up front and won’t have to worry about added expenses.

No two houses are the same. And there is no set charge for all homes. You have to clean for awhile yourself to get some experience and to work out a system to clean efficiently. Only you know what you want and need to make. Decide what you need to make hourly to cover all expenses and still make a good profit.

A word of advise: Make sure when you start your company that you charge what you would charge if you had employees. Some people make the mistake of under charging when they start out just to get customers and then later on when they grow and need to hire help they aren’t making enough money on their houses to pay help. Don’t under price your work. Cleaning homes is very hard physical work and you didn’t get into this business to work for nothing.

New Construction Cleaning If you decide to do this type of work you will need more equipment. You will need ladders, window cleaning kits with long extensions, a shop vac, etc. These types of jobs are usually 2 to 3 person jobs. New construction cleaning requires a lot more cleaning. You may have to remove stickers and labels from windows and bathroom showers, sinks and toilets. Some require that you clean the vents to remove dust from construction work. There will be ceiling fans to clean, scrubbing floors, and cleaning woodwork to remove dust. New construction cleaning rates depend on the area you live in.

Insurance and Bonding. You need to be an honest person and somewhat personable. People will need to trust you to be in their homes. Most clients are concerned about having someone new in their house, with good reason. You should be bonded and fully insured. Liability insurance rates depend on your insurance carrier and where you are located. Each person you hire will increase your liability insurance. It’s well worth the cost. You can pay quarterly or yearly. You can purchase your bond through your local insurance company. You will need to renew the bond every year. *Note: if you hire employees and cover them under your insurance, they must be an employee on payroll and not a sub-contractor. If you employ them as a sub-contractor your insurance will not cover them. If they are a sub-contractor they are required to carry their own insurance. You

Hiring Help If you start out cleaning the homes by yourself, you will eventually get to the point where you need to expand your business. Start out with one part time employee. Train her and let her take your place one day a week. Then have her take your place 2 days a week and so on. This will give you the free time that you need to market your business and obtain more clients. After you get more clients you will be able to hire more part time help. Eventually you will be able to stop doing the cleaning yourself and just run the business end, which is the only way you will be able to grow your business. When training new employees, always, either train them yourself or have a lead person train them. Make sure there is a lead person on each and every cleaning job. Employees have a tendency to slack off when they are on their own.

Growing Your Business You will eventually get to the point where you have enough employees and lead people and you will be able to stop working in your business and start running your business. You will find that after awhile it will get to be too much trying to clean everyday and at the same time giving estimates, answering calls, scheduling, doing book work, obtaining new clients, etc.

Remember one of the most important qualifications for a cleaning service is TRUST. A client has to know they can trust you alone in their home. After you acquire a few cleaning positions ask the clients if you can use them for a reference. Most of the time they are more than willing to let you use them for a reference. This is how you build your business and acquire new clients is through referrals. Be dependable. Most clients will want to be set up on an every week or every other week schedule on the same day of the week. Try to always keep this same schedule unless the client asks you to switch to another day. If you have to cancel a cleaning date, make sure you try to reschedule at the earliest possible date to make up the cleaning.

You are free to use this article in part or full provided you include the bio below.

Patti Page is the owner of Page’s Personal Cleaning in Cincinnati OH.
Website: http://www.pagespersonalcleaning.net/cleaningarticles.htm

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Catering Business Information – Is a Catering Business Right For You?

Monday, April 4th, 2011

If you are a business minded, creative person with a flair for cooking, a catering business might be an ideal venture for you. Managing your own catering company will give you’re the opportunity to channel your creativity, energy and ideas into something you not only do well, but something you enjoy. Running a catering business, as with any entrepreneurial venture, you will encounter new challenges and be your own boss. The only limits to your catering business will be the ones you place on yourself.

What Do I Need to Know About the Catering Industry

Catering businesses prepare and serve food for social and corporate events. Corporate events include conferences, employee incentive events, customer appreciation events and meetings. Social events, such as weddings, parties or even private dinner parties are another catering market.

While food serve is a very important component, the most important aspect of any business is business development and marketing. Simply put, no clients means no business.

An outgoing, confident personality is a must in the catering industry, especially for anyone working directly with clients. Clients range from meeting planners, to stressed brides to corporate executives. In each case, you will need to not only market the food, but you will be marketing the service also. Clients must be confident in your ability to not only create a delicious meal, but you and your staff must act in a professional manner in every aspect of the event. This means the from the moment you first meet with your client until the final meal is served, the event looks seamless.

Building Your Network

All successful caterers must create a referral network in order to create and stay in business. The easiest way to do this is to introduce yourself to others in the party planning and event management industry. For example, wedding planners, party equipment rental centers, florists and bridal shops are all great connections. Local banquet halls which do not have in-house catering services are another great business lead.

Make sure you always have business cards with you, because you never know who you might run into while waiting in line somewhere. Follow up with your contacts and if you’d really like to show off your culinary skills, drop off sample appetizers or desserts to potential clients.

Catering Business Information and Tips

As with all small business, your success is directly related to your planning and executive of your plan. It is very important to understand your client’s expectations and to meet, or ideally, exceed those expectations.

Keep in mind in the catering business, thirty percent of your time and labors will be related to the food, while seventy percent of your efforts will involve food delivery, equipment rental and staffing. This is why organizational skills are necessary to your success and survival as a catering business.

Enthusiasm, focus and business-savvy decision making skills are also vital to the long term success of your business. Fulfilling your client’s wants and expectations will always be your top priority, and it is important to remember patience and understanding goes a long way in building and maintaining relationships.

If you are thinking of starting your starting your own business in catering, visit http://StartCateringBusiness.org for expert tips for starting and managing a catering business.

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Affiliate Marketer – The New Business Maker

Wednesday, September 15th, 2010

business is greatly dependent upon various components. One of the major components is marketing. There are various genres of marketing that support the business and help it in flourishing. One of the most interesting sections is the affiliate marketing. Have you heard about the concept and are now ready to try your luck into the new venture? It is not surprising to find more and more people getting fascinated towards this field of marketing. To begin with, you need to have the clear perception about the affiliate marketing. In this practice, for every customer that you persuade for visiting a particular website, you are rewarded with your share of commission.

Beginning with any form of business today involves numerous difficult facets to be covered. The best part about affiliate marketing is the least requirements involved. If you have decided to become an affiliate marketer you can truly earn very well. However, it is very essential to remember that systematic step-wise technique is very vital for the beginners. At the outset, you need to decide upon the niche market that you wish to opt for. A thorough research of the current market status and sectors provides a good picture about the fields in demand or the ones that can be very profitable in the near future. Once you have finalized the niche, choosing an impressive and attention-grabbing web address is a must.

Believe it or not, the address of your website is actually a decisive factor when it comes to magnetizing people and compelling them to visit the website. Purchase a powerful web address that creates a strong impact. How disappointing does it get when you follow an interesting web address and land up in an exceedingly boring and complex website? Thinking from the viewers point of view you will realize that design of website should be professional and yet eye-catching. It is advisable to hire professional web designers for this task. If you want the sales to boost, a well designed website is mandatory. Ultimately, it is the profit that you are looking forward at.

When you are planning to become an affiliate marketer the next very important step you need to pay attention to is the placement of the affiliate link. Clustering the webpage with too many shabbily placed links can totally disappoint the viewer. The access on these links should be uncomplicated. Like products should be placed with each other. An easy to comprehend website can do wonders in increasing the number of viewers and the sales. An affiliate link of a totally different genre in comparison to your niche may generate disinterest in the viewer. As far as possible, provide links of similar subject to avoid deviation of customer’s interest.

If you are a newbie as an affiliate marketer, starting blog sites and forums is of great help. To create a strong position in the market, a constant monitoring and update about the keywords and the links is highly significant. It helps you conclude the most profitable links and keyword. You should keep looking for latest affiliate link that can fetch you higher profits in the business. After all, change is the only thing that is constant.

90% of the common and average people will never take action towards creating or improving their online businesses. If you are not one among them, take advantage of my free report now and develop your business intelligence. Grab Your Digital Report Here: http://alfredocarrion.com/gift.html (Limited Time Offer… Hurry!)

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New Business Credit Card – Why You May Need To Switch Cards

Tuesday, September 7th, 2010

If you have been a business owners for a few years, you may want to look into getting new business credit card. The benefits and advantages of current lines of credit far exceed those from a few years back. You may even save your business some money if you switch to a new business credit card.

Let’s look at some ways why choosing a new business card may be a good idea:

1. No Expiration Of Rewards – Running and maintaining a business probably takes up most of your time. Using up your rewards should not be a worry to you.

Recently, many lenders have been offering a “no expire” clause for the rewards you build on your new business credit card. You can allow the rewards to accumulate for as long as you need.

I think this is especially helpful for air miles.

2. Fixed APR Rates When Economy Is Struggling – Another reason why you may want to change in your old card for a new business credit card is the low interest rates offered during a struggling economy.

With a little bit of research, you can find an excellent fixed APR rate that will last for the entire length of the time you have the new business credit card.

3. Allowed Transfers – This goes along with number 2. If you do decide to get a new business credit card, look for one that allows balance transfers.

You will save a good amount of money on the new interest rate only when the lender allows you to transfer the balance.

4. Higher Percentage Of Cash Back – I recently saw a card with a percentage back rate of 5%. That is fantastic for a business line of credit. In the past, it was common practice to offer 1% back. I always hoped companies would offer a higher rate for being a loyal customer. They must have heard my thoughts and wishes!

I believe this is a great time to look for a new business credit card. You can find better reward options, rewards with no expiration dates, better interest rated fixed in for the duration of the life of the card, and you will save your company money by transferring all balances to a card with lower interest.

Finding a card with all of these options will take you some time. It more than likely will not be the first card you come across in your search. However, you have the right (as long as your credit is good) to change cards whenever you want. Now may be a good time to do it.

Shawn Casey Wants Business Owners To Understand The Difference Of Getting A New Business Credit Card And Start Up Business Credit Cards. You Can Apply For A New Card Even When Your Business Has Been Established For Years. To Find Out More Information On The Two Types, Read These Two Articles.

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12 Ways to Get New Business Leads

Wednesday, September 1st, 2010

Every small business owner and entrepreneur, every services firm and solo practitioner should begin every day with this recognition: “I need new business leads.” Someone in your organization should be devoting part of every day to finding and nurturing leads for your company or firm. New business leads are the lifeblood of your company.

No matter how much easier and less expensive it is to keep selling to people who have already bought from you, the truth is that current customers can only buy so much. Every product or service will not be appropriate for them. If your business is to hold its ground and gain ground (grow), you must bring in new business leads.

Your processes for finding new business leads might be largely automated or it might be largely manual. The future does not require automation. Building a future for your business by ensuring a steady flow of new leads, requires daily attention to marketing, lead generation, lead nurturing, lead conversion, sales and ensuring customer satisfaction.

How to Get New Business Leads

There are many ways to find and attract new business leads. Most companies use a combination of many tactics. Some of the most productive are:

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Are You Using These 3 Marketing Ideas in Your New Business?

Saturday, August 7th, 2010

You’ve got your idea in place, you have done all the paperwork and your new business is launched. So what do you do to get it promoted to the world? This article will present three quick marketing techniques. These strategies apply whether you are a brick and mortar business at the local mall or a home based business. The power of the internet works as an equal opportunity employer.

Number 1 – Social Networking This is probably the simplest and the most familiar. We all know the power of referrals. Use your Facebook account to introduce your business to your world. Now you don’t want to come out and be a blatant advertisement. Start a conversation with a close friend about your excitement of starting your own business. Allow the conversation to evolve including products or services that you provide.

While in Facebook, accumulate more friends and join groups of like minded individuals. Join as many groups as you have interests which would include business or personal or maybe environmental. Start connecting with people outside your own social circle.

Number 2- ads While you are starting your business, your budget may be squeezed a little bit tight. If this is the case, there are many places to advertise for free. Craigslist is one of them, but you need to be very careful and examine all of their rules. There are other sites such as USFreeAds, InetGiant and more. As your business grows, you can then expand your Ads into paid ads. Take the time to look at Google AdWords. You may not be ready at this point, but it is an area that eventually you will want to incorporate into your advertising strategy and budget.

Number 3 – video marketing We all love to watch the videos on YouTube. Why not use that for your own business? If you are a little bit of a ham, video marketing will come easily. You may think that what you recording is goofy, but go for it. Try doing a search on Google for a product or service. The chances are great that on the first page of the Google search, there will be some sort of video. Videos rank very high in the search engines.

If you have the burning desire, but don’t know where to start with a new company, visit us at our institute for local marketing. Learn the abc’s from starting your own business, finding clients, establishing credentials and finally the marketing.

Wishing you all the success in your endeavors.

Sharon

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Is McCain an Ignotech?

Thursday, July 8th, 2010

The Topics:
Apple’s Upgraded iPods

Apple’s CEO Steve Jobs took the wraps off a revamped line of iPods and trumpeted a truce with NBC Universal that means the TV network will begin selling programs again on iTunes. The iPod upgrades Jobs unveiled Tuesday in a theater in San Francisco include two slick new Nano models, oval-shaped devices that Jobs said are the thinnest iPods Apple has ever made.

Obama: McCain is an Ignotech

Barack Obama has told voters that John McCain is a poor choice for the highest office because he “doesn’t know how to use a computer” and “can’t send an email.” A new Obama TV ad flashes images of a dumbbell-sized mobile phone, a vinyl record player, and a a Rubik’s cube.

Newspapers Cry Foul Over Google/Yahoo Ad Deal

The World Association of Newspapers says it opposes a pending deal on advertising between Yahoo and Google The group wants European and U.S. regulators to block the deal on antitrust grounds. WAN says it fears the deal would give Google “unwarranted” market power in parts of the online ad business. Yahoo expects the deal to generate $800 million in annual revenue.

Lenovo Dumps Linux

Lenovo has dropped Linux from the list of operating systems it will preload on desktops and notebooks sold via its website. The operation has been shipping Linux on client PCs since 2000. A Lenovo spokesman told ComputerWorld that its commitment to Linux had not changed. How does that make sense?

Virginia Court Rejects Anti-Spam Law

The Virginia Supreme Court declared the state’s anti-spam law unconstitutional Friday and reversed the conviction of a man once considered one of the world’s most prolific spammers. The court unanimously agreed with Jeremy Jaynes’ argument that the law violates free-speech protections because it does not just restrict commercial e-mails — it restricts other unsolicited messages as well

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Highlights From This Year's Shows: The Good, The Better, and the Ugly… | CrankyGeeks Episode 199

Wednesday, July 7th, 2010

Today’s Guests:
Sebastian Rupley, Co-Crank, Editor, GigaOm.com
Various Guests, Highlights

The Topics:
The Good
The Better
The Ugly

alt : http://m.podshow.com/media/19439/episodes/206380/crankygeeks-206380-01-05-2010.movhttp://m.podshow.com/media/19439/episodes/206380/crankygeeks-206380-01-05-2010.mov< ![endif]-->

The rest is here: Highlights From This Year’s Shows: The Good, The Better, and the Ugly… | CrankyGeeks Episode 199

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Manager Jobs – Create Your Own Opportunities

Tuesday, June 15th, 2010

With manger jobs there are many times that you can effectively create your opportunities without having to leave where you currently place of employment. That is because there is always going to be a need for a company to have qualified and quality people in manager positions no matter what company it is you are looking at. So the company you work for may be the best possible place for you to begin your quest for a manager job.

In order to determine if your present employer will have an opportunity for you ask them. As the old saying goes, “If you don’t ask, you’ll never know,” and this is certainly the case when you are think about a manger job where you are currently working.

By talking with your present employer about possible manager jobs, you are killing two birds with one stone. First, you will find out what managerial opportunities may be waiting for you and second, you will let your employer know that you are in fact interested in becoming a manager. Be warned though. Once you declare that you want to become a manager, a closer eye will be kept on your work.

If there is an opportunity for you to become a manager at your place of employment then find out exactly what it will take to get there. This will include:

Free Consignment Store Business Plan

Monday, June 14th, 2010

Free Consignment Store business Plan for Loans

Obtaining Business Financing

 

When obtaining a business loan for a consignment store business, it is imperative that you have a properly structured business plan that will assist you in showcasing how you intend to operate your Consignment Store, how the business will operate, how you intend to market the business, the anticipated financial results of your company, and how you intend to repay your debt obligations. This sample loan business plan will provide you with the framework that you need in order to acquire a business loan for starting or expanding this type of business.

 

Executive Summary

 

Introduction

 

When obtaining a business loan for a consignment store, it is imperative that your business plan has a clear and concise executive summary that provides an outline of what are seeking to accomplish, how much capital you are seeking to raise, the management biography of the business owner, and an overview of the anticipated profit and loss statements of the business. Here is an example of how the title paragraph should be written:

 

Consignment Store, Inc. (“the Company”) is seeking a business loan of $100,000 in order to launch the operations of a consignment store business that will be based in San Francisco, California. The Company was founded in (Insert Year). The business was founded by Mr. John Doe.

 

Products and Services

 

In the next segment of the business loan and business planning document, you should showcase the products and services that you will be providing to the general public. For instance:

 

The Consignment Store will provide customers with the ability to consign clothing and other items through the Company’s retail location. The business will receive a fee equal to 40% of the consigned products sold through the Consignment Store’s location. The business will specialize in the sale of clothing and other related small retail products.

 

Business Loan Terms

 

Now it is time to discuss the anticipated terms of the business plan that you are seeking. An example paragraph of how this is stated:

 

At this time, Mr. Doe is seeking a conventional business loan in the amount of $100,000. The interest rate, loan terms, and loan covenants are to be determined during negotiation. However, this business plan assumes that the business will receive a seven year business loan with a seven percent interest rate due on the outstanding principal balance.

Management Biography

 

Now that the summary of the business has been provided, it is time to provide a brief overview of the owner of the business. An example paragraph summing up the owner is as follows:

 

Mr. Doe is a highly experienced business person that has years of experience regarding the direct ownership and management of business. He will be able to effectively bring the operations of the Consignment Store to profitability while ensuring that the business loan’s payments and its covenants are met at all times.

Financial Statements

 

The most important thing to your lender when applying for a business loan is how you intend to repay the bank. In this section of the business plan, you should provide an overview of the finance’s of the business discussing the anticipated revenues, expenses, and profits/losses. You can also discuss the applicable collateral within the business plan that will be used to secure your business financing.

 

Expansion Plans

 

One of the most important aspects of your business plan is how you intend to expand the business over a three to five year period. Banks and finance companies always want to see that the business will experience a moderate to strong level of growth. This is especially true in business lending because as your business grows the cash flow that secures your business loan will decrease proportionality against your monthly credit obligations. An example of how this is stated is as follows:

 

The Consignment Store will continue to expand through organic means including increasing the Company’s advertising budget via the reinvestment into the after tax cash flows of the business. Additionally, if the business is highly successful then the Company may seek to establish additional Consignment Store locations after the third year of operations.

 

 

The Financing

 

Use of Business Loan Proceeds

 

In this section of the business plan you should focus on how the proceeds of the business loan will be used. An example of this would be as follows:

 

Consignment Store Establishment – $50,000
Opening Inventory – $10,000
Working capital – $40,000

 

Management Equity

In this section of the business plan you should discuss the percentage ownership of the business among the owners of the business. For example:

 

Mr. Doe will own 100% of the Consignment Store.

 

Board of Directors

 

When applying for business financing, the bank will also want to know who serves as the board of directors. For small businesses, usually the owner serves as the director of the business. An example of how this is worded:

 

Mr. Doe will be the sole director of Consignment Store, Inc.

 

Exit Strategy

 

Any bank or financing company is also going to want to know what you intend to do with the business over a set period of time. Many business owners will develop and expand a business with the intent to sell the company to a third party at a later time. When drafting this part of the business plan you should focus on what you intentions are in regards to potentially selling the business. This is often worded as:

 

Mr. Doe would most likely sell the Consignment Store to a third party for a significant earnings multiple. Consignment Stores usually sell for approximately one to three times earnings given the financial strength of the business. In this event, the business would be sold by a business broker and the business loan sought in this plan would be repaid according to the covenants of the business loan agreement.

 

Products and Services

 

When developing a business plan that is appropriate for obtaining a business loan or other business credit facility you need to clearly showcase the services or products that you will be offering to the general public. An example of how this section is worded goes as follows:

 

As stated in the executive summary, the Consignment Store will specialize in the retail sale of items on behalf of individuals within the Company’s target market. The business will charge a fee equal to 40% of the sale of each consigned item. The business will use a number of means in order to generate sales through the Company’s store. This includes listing items on EBay and other popular websites so that the business can generate substantial sales outside of the Company’s retail location.

 

 

Industry and Market Analysis

 

The Current State of the Economy

 

It is important to let your financial institution know that you are well apprised of the financial situation of the general economy when you are applying for a business loan. This is especially true in today’s environment where lending has become more difficult and will remain more difficult in the foreseeable future. Specifically, you should gear this section of the business plan analysis towards the industry that you are operating within. For example:

 

The current economy has remained difficult over the past few years. However, Consignment Stores typically operate with a strong state of economy stability as these businesses are often used as a last resort among people that are seeking to sell their clothing or other retail items in exchange for a significant percentage of the value of the merchandise.  As such, the business should be able to remain profitable and cash flow positive in any economic environment.

 

The Consignment Store Industry

 

In addition to providing your business loan officer with an understanding of the general economy, it is important that you showcase that you have an equal understanding of the industry in which you are operating within. As such, you will need to provide you business loan institution of a brief overview of your industry and any potential changes that may affect the way that your company does business. An example of how an industry overview is as follows:

 

In the United States there are over 17,000 businesses that specialize in the sale of consignment apparel to the general public. Among these businesses, the aggregate receipts generated from the sale of used merchandise are approximately $17 billion dollars per year. The industry employs more than 97,000 people and provides gross payrolls of $1.2 billion dollars.

 

 

 

Target Market

 

In this section of the business loan application and business plan analysis, you should focus on the demographics of your localized market (or national market if applicable). This section should discuss how many people live in your area, the anticipated number of people that would require the use of Consignment Stores, the median household income of people living in the area, poverty line statistics, and any applicable laws that would apply to your operation of Consignment Stores.

 

Competition

 

Many people that are developing new businesses or expanding existing businesses often feel that their business does not have any competition or limited competition at best. However, this is almost never the case. Unless you have re-invented the wheel