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    12 Replies Latest reply on Sep 25, 2009 8:02 AM by JoeBWalker

    Start Up New Business

    cjrivas61 Newbie

      How much do I need to start up a new retail business. Would 50k be too little ? I know I have to consider Rent, Insurance etc...But where could I get more information to figure out how much I will really need to start and what will I need before I open the business (besides what I'm selling).

      Your information is needed...thank you

        • Re: Start Up New Business
          medina2005 Wayfarer
          about 100k
          • Re: Start Up New Business
            LUCKIEST Guide
            Start Up New Business, Welcome

            Who are you?? You need to develop a Business Plan and the plan will tell you how much you need.
              • Re: Start Up New Business
                cjrivas61 Newbie

                Hi Luckiest,

                Thank you for your response.

                I have estimated some of my expenses, but what about liabilities, such as Insurance, taxes, etc. I need more information as to what my actual expenses are. My guess is to research with Insurance companies. But what is a good web-site to find more information about tax guidelines and starting a business. I need step by step planning. I have never opened a business before and I would like to know who I should contact first and get pricing. Would a lawyer help? A consultant?

                  • Re: Start Up New Business
                    bmt2008 Adventurer
                    This is what a business plan will do for you - answer all of these questions. Try SCORE - also look for a SBDC in your area. They can help you find many of these answers. You could also try to find public information about similar companies (provided that if these are public companies they probably are much, much larger than your start-up). But, if you common size their financials - then apply those ratios to your your own estimates of income - you might get a better idea of your cost needs. Further, researching public comapnies may help you identify other items you may not have thought of.

                    Just some thoughts
                    • Re: Start Up New Business
                      StartUpSage Newbie

                      Hi,

                      Unfortunately there are very few talented consultants around to help assist people with business start up services. In Australia, we formed Business Switch (www.business-switch.com.au) to provide advice to people wanting to start a business in Australia. You are welcome to visit the website and extract any information you can apply to the US.

                      The Start Up Sage
                      Business Switch
                  • Re: Start Up New Business
                    AdelleCheroke Newbie
                    I am a licensed real estate agent, specializing in commercial real estate. Here are my recommendations:
                    1: Clean up your credit. Prospective landlords and wholesalers alike
                    will want to run a copy of your credit report. Try to pay off high
                    balance debts on your credit cards, and close unnecessary store
                    accounts. Your security deposit for your lease space will be based on
                    your credit report. Most landlords will require first month's prepaid
                    rent, and two months of rent as security deposit. Be prepared.
                    2: File a corporation and get a sales tax ID. You may want to consider
                    having whomever has the best credit to be named "president" on the
                    corporation, as your corporation name will be signing a lease for
                    retail space and the president will be signing the lease. Additionally,
                    having your corporation name and a sales tax ID established prior to
                    speaking with prospective landlords and wholesalers shows that you are
                    serious and ready to move forward.
                    3: Determine your square footage requirements. A typical retail store
                    will fit comfortably into 900-1,200 square feet of space. This will
                    give you plenty of room to display equipment on the wall space, and
                    have racks for clothing. If you have larger equipment displays,
                    consider going up to 1,400 square feet. Remember, the higher the square
                    footage, the more money in rent.

                    banking deals[/url]
                    • Re: Start Up New Business
                      Tracker

                      Cjrivas61:

                       


                      What city and state are you in?

                       


                      How large of a facility do you think you will need?

                       


                      What type of merchandise do you plan to sell?

                       


                      I agree with Luckiest, you need to create a business plan. I offer a free page on my site that gives information about creating a business plan. Here is the link:

                       


                      http://thesologuide.com/planning/

                       


                      Unfortunately, I don't think that anyone can give you appropriate answers as to your expenses without knowing more details about your business - which you will include in your plan.

                       


                      Average rent and utilities vary greatly from city to city. Different types of retail businesses have different requirements for capital equipment. Are you planning on hiring employees? Wages vary from city to city.

                       


                      Please provide some more detail so we can better help you.

                       


                      Hope this helps.

                       


                      Doug Dolan

                       

                      The Solopreneur's Guide

                       

                      http://thesologuide.com/
                      • Re: Start Up New Business
                        Liton01 Newbie
                        There are many banks trying to continue their business by giving loan money. Its now easy and more flexible to get loan. Try to get the bank loan.
                        • Re: Start Up New Business
                          JoeBWalker Newbie

                          I'm a CPA with 30+ years experience. I'm a consultant in the small and startup business area.

                          Basing my comments on my personal experience with new business entrepreneurs, I'd venture a guess that 95% of individuals' ideas/dreams never get past the talking stage. If someone actually starts sketching out a plan, the first thing they learn is they hate sketching out a plan. Unfortunately, most successful businesses require putting a pen to paper at some point. Most entrepreneurs want to apply their trade, and hate the back room paper shuffling function. Certainly, all business must keep records, if only to file tax returns, and there are probably more tax reporting requirements than most people imagine. I've coined the phrase "store front vs. back room" to distinguish the differences between applying an individual's trade and accounting for the results of business operations.

                          In short, if you're thinking about starting a business, be prepared to spend more time than you'd rather, and far more time than you might estimate needed, shuffling paper.

                          I've had dozens of clients who were very skilled in the "store front" and had no conception of how the backroom function, if left unattended, could kill their business.

                          Personally, I think writing a standard business plan is often a waste of time. By contrast, I'd just read through a business plan template and create a facsimile shortened document.

                          Eventually, all businesses need a financial record keeping method. I'd recommend QuickBooks, although I've used Peachtree and One-Write Plus accounting software, too.

                          I'd probably purchase QuickBooks Pro and use it to guide you through a basic pro-forma financial model. QuickBooks has template reports that can be used for budgets/projections and it can also be used to set up a chart of accounts for just about any business industry/sector. .

                          With all that in mind, I'll cite a website reference that might help anyone with streamlining the paperwork that might be needed to get a business off the ground:

                           


                          http://office.microsoft.com/en-us/templates/CT101527321033.aspx

                          I'll check back at this forum to see if anyone found this post to be useful, and add additional commentary if warranted.

                          Joe
                            • Re: Start Up New Business
                              Tracker

                              Joe:

                              Helpful and interesting response to this thread. I agree with most of what you have to say, but want to question you about your thoughts on the necessity of business plans.

                              As I mention in my previous post here, I have a page on my site that gives free info for creating a business plan. Here is the link:

                              http://thesologuide.com/planning/

                              I agree that a detailed business plan that an investor or some other lending institution will want to see is not necessary for all companies. I believe that the extent / detail of the plan depend on the following:

                              1. The complexity of the business

                              2. The amount and source of the funding

                              3. The extent of the damages that an individual / partnership / corporation will incur if the business fails

                              Do you agree or disagree?

                              Thank you,

                              Doug Dolan

                              The Solopreneur's Guide

                              http://thesologuide.com/
                                • Re: Start Up New Business
                                  JoeBWalker Newbie
                                  Doug -

                                  I looked at your website. It looks like a treasure chest of valuable information.

                                  I agree with your summary.

                                  If a client of mine was looking into raising a good deal of money, say in the $250K range or more, it would make sense to, devote, and I would recommend devoting, at least a few weeks and several thousand dollars into creating a solid business plan document.

                                  Perhaps you could develop some sort of 1) time line and 2) cash formula for investing 1) time and 2) money in the planning stage.... I realize there are many variables, but I think some guidelines could be created to assist business startups on how much time and money should be expended, or the average business expends, on developing business plans vs. when the venture should get going and make a sale or provide a service...

                                  ... or, perhaps creating a clearing house for actual experiences, successes vs. failures compared to up front investments in the planning stage/area, small to great...

                                  When I first started my first business, I had virtually no plan. I just started selling my consulting services and leased/opened a small office. I didn't have a fax machine, and my PC had no hard drive, just dual 5 1/2" floppy drives, if you can imagine that. Now, I don't recommend my/that method... but I do know how difficult it is to focus on business plan development vs. the entrepreneurs' nature to actually start operations...

                                  BH
                              • Re: Start Up New Business
                                allan0113 Adventurer
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