SOA - Where do I start?

Sutty

I agree with Freda. I'd be tempted to leave the business behind, or at least postpone it until your in a better position. It might be worth your while to find some evening work and cut out child care costs altogether. Work in a bar, petrol station, corner shop... It probably won't pay a lot but you'll already be £350 up from losing the childcare fees. Earn another £150 a month and you've just hit your minimum target income for your business. You could also find something to do during the day working from home, Ironing, Laundry, Avon, Usborne books, Phoenix cards. You could do one or two of these whilst looking after Junior and it would bump up the income.
All the best, you're in the right place!

*zippy*

WestEndGirl wrote:

Business income isn't THAT bad - have averaged about £500pcm, and once it gets going should be £1500pcm minimum, but it's that magic phrase isn't it - "once it gets going..." Other franchises are doing OK, not stratospheric, but ok.

I was advised that it takes about 2 years to build a business up, which was true for me. The thing is are you prepared to or can you afford to give it another year and the extra debt that may involve?

No-one wants to depress you :grouphug: personally I took an evening job as well as suggested by bluezone so I had money I could rely on, nothing fancy, evening supermarket work. Go through your figures and see if you can make up that overspend. What is your earning potential like if you give the business up?

all_hours

WestEndGirl wrote:

Now I'm really worried... I was ok-ish with fact that I was building up business, knowing it wouldn't take off overnight, and might have to tighten belts (severely, but hour-glass figures are more attractive...), but you guys seem really serious.... But even if I finished tomorrow, I'd still have loan to repay and virtual office contract until next April. Business income isn't THAT bad - have averaged about £500pcm, and once it gets going should be £1500pcm minimum, but it's that magic phrase isn't it - "once it gets going..." Other franchises are doing OK, not stratospheric, but ok.

If you used the time your son is at nursery to go out to work - would you be able to earn more than £500 per month? If not then stick with the business while you are committed to the expenses and throw yourself at it.

Have you done a graph or chart to see how your business is growing? Can you predict where it will be in 6 months time?

Income 2060
Business income 500

Current Total 2560

Outgoings 2078
Business costs 500
Debt repayments 529?? You've written £100 on each CC (x3), M&S loan is £229.03 pcm but there are 5 CCs listed. Is the Tesco £500 in credit?

Current Total 3107

This gives a deficit of 547

If you cut the shopping down by £150. This brings the deficit down to £400 per month.

I know the overdraft has the higher interest but if you used the savings to pay £5000 off the credit cards this would reduce your debt minimum payments by at least £100 per month - bringing the deficit down to £300 per month. You'd need to include an amount to your outgoings to work towards reducing the overdraft.

Could you redirect the ISA until next April? This would bring the deficit down to £50 per month - which I'm sure you could make up by shaving a little more off the food budget and reducing utililty bills. If using the ISA money isn't possible then would a part time job to bring in the extra £250 per month be possible?

Destined_to_be_skint

I'm no expert here either, but I thought we should have a balanced argument regarding the business. Yes, businesses do take at least two years to build up, and to be getting an income of £500 pcm average within a year is a fantastic achievement. Well done, I say, because it takes a huge amount of guts and determination to start a business. It seems crazy to have spent all this time building it up and are going to let it go when it could possibly provide you with a decent income in the next couple of years if you stick at it.

Having said that, you are in a lot of debt, and I suspect the people that are posting on here would rather be clear of debt than in business!

Regarding virtual offices - when your contract ends try Westbury (do a google) - I use them and it's really cheap at £15 pcm for the most basic service.

WestEndGirl_2

Thanks Zippy

My employed earning potential is reasonable, but would only work part time as it's not fair on my little boy to put through full week at Nursery which he dislikes going to in first place..) He's ok when he's there (apparently), but just not overly keen...) Top whack I'd get about £27k pro rata, so £1350 less tax a month, say £1000. Which is obviously not to be sniffed at, but would mean buying a runaround car since neither of us can get to work by public transport, unless job came up close to hubby's work and can share car journey. I am looking about, but most seem to be full time/not paying enough.

House-wise, it seems, bizarrely, that most other houses around us are still going up in value, but our development, perhaps because it's not accessible to public transport hasn't, and in fact has gone backwards - house nearby sold for £279k in 2004, now on market for £249k. We'd have to move area radically to get much for our money, especially after costs of moving are taken into account.

Hmmmmm

I DO think my business can work (if I can spend less time on forums like this and more time ringing up contacts...), so I suppose I could be looking at debt maintenance for a while, rather than paying back, and keeping new debt to minimum...

Thanks all_hours too - that deficit reduction strategy of yours is pretty nifty... The Tesco CC is in credit, at the mo. I will have a look at the ISA - not sure if we lose all we've paid in if we stop payments, but maybe we can suspend them for a while - does anyone know?

Starting to feel slightly less desperate now, thanks.

*zippy*

Have you contact with the other people with the same franchise? This might be helpful to give you some extra ideas for building the business up. I also bought a good marketing book.

Honeybee_2

*to anyone who has read my other posts, please note I do NOT have a nappy fetish!*

Have you considered reusable nappies for your little one? Initial outlay can be pricey but depending on his age and size, you could get some bargains on ebay.

WestEndGirl_2

Thanks Honeybee - I did try real nappies very early on, but hubby wasn't keen so project died a death. Almost out of nappies now though - completely dry in Nursery (although refuses point blank to use potty/loo at home...) but have new cunning plan - Morrisons nappies... All due respect, they are vastly cheaper than Huggies/Pampers, but they look and feel it too, so hopefully will be too uncomfortable for son to use for long...

Zippy - I have got some really good marketing advice and materials (bought off t'internet) which wasn't cheap but WILL PAY OFF (she keeps muttering to herself...) It's just a matter of time, and, quite frankly, running a business part time was a pretty daft idea. I really need to ramp it up, and hopefully this sorry mess will be my wakeup call to get going...

Destined to be Skint - I really appreciate your points, and thank you very much for your comments.

david_hellier

I think you need to do the SOA again include ALL minimum payments on the ccs and loans. A spending diary is available on ebay.

all_hours

I know the overdraft has the higher interest but if you used the savings to pay £5000 off the credit cards this would reduce your debt minimum payments by at least £100 per month - bringing the deficit down to £300 per month. You'd need to include an amount to your outgoings to work towards reducing the overdraft.

I thought about this again. The overdraft is costing you £75 per month in interest - 1% of £7500.

If you paid the £5000 off the overdraft you would only pay £25 per month interest so £50 better off.

If you paid £5000 off the credit cards you'll still be paying out £75 in interest on the overdraft so only £25 better off.