starting ltd company-need funding

paddyrg

What's the license fee line item? If that's like a franchise fee (ie buying a license to use a brand name, or something) then perhaps the master franchise holder can help you with finance?

Personally, I would look seriously at doing a few months lease if possible, or talking to the machine vendor about some kind of HP deal where you rent the machine from them monthly, it remains theirs until you make some sort of balloon payment after (say) 3yrs (or whatever the guarantee period is) - then your exposure in terms of start-up is much much smaller right when you need the cash!

confusedlittlebunny

stephenni1971 wrote: »

The figures above count for 100% of your £20,000.

You have not allowed anything whatsoever for fitting out your unit, I would have thought you would need a reception area and a private room for treatments at least. £200 for a website is a ridiculously low amount as is the £500 for advertising figure you have. What about working capital, rates, electricity, signage, you will need a phone line installed, public liability and some sort of professional liability ( in the event you injured someone during a treatment ). Where have you allowed for all these costs???

Are you going to be the sole employee of the business? Can you commit to being in the unit six days a week, will you have to close for lunch etc etc.

Thanks for your response stephannie. Apologies, I didnt make it clear, I am only renting a treatment room (sub-letting) within a medical centre, therefore, no over head as such....I am thinking to start small then build up to maybe my own premises etc, my insurance is within my consumables, the licensing fee is the annual fee to the local council to get a license to treat legally and within the law! with the website, i have family helping me (doing the major part of the site) with this to cut my costs, so thats where £200 comes from. Initially, I will have to work, with no salary as such until I build up.

confusedlittlebunny

paddyrg wrote: »

What's the license fee line item? If that's like a franchise fee (ie buying a license to use a brand name, or something) then perhaps the master franchise holder can help you with finance?

Personally, I would look seriously at doing a few months lease if possible, or talking to the machine vendor about some kind of HP deal where you rent the machine from them monthly, it remains theirs until you make some sort of balloon payment after (say) 3yrs (or whatever the guarantee period is) - then your exposure in terms of start-up is much much smaller right when you need the cash!

The fee is the local council annual fee, for me to trade legally. In the latter part of your message, you have hit the nail on the head, i think renting is my best option, to minimise costs and then build up slowly, inturn, with this decision it will reduce my need for such a large loan........

paulwf

OP forget the fantasy figure of £122 a month bank loan. For a fast moving industry like this - in fact for any industry these days - the bank will want the loan paid off in 36 months. That means a £555 monthly capital repayment excluding the interest repayments.

I'm sorry if this sounds harsh OP but your business plan and calculations sound very naive for someone that has run their own company before. I think it would be a lot safer to get a job in this industry and get a guaranteed pay cheque whilst you find out exactly how the industry ticks before starting your own business. That will also give you time to repair your credit rating. As with my last post if you are good enough to run your own company in that field you'll have no problem getting a job in it.

jexygirl

If you are subletting a room within a "medical centre" my question would be why?
IF it was viable / profitable, surely an existing practice would have seen the opportunity and purchased equipment and trained a practioner themselves? If its a substantial buisness and they are subletting, they will no doubt have the finances, or ability to finance it themselves, as well as contacts to get good deals - perhaps better than yourself - on the equipment.

If the existing practice are subletting to you, are they simply letting you test the market, and if it works they will terminate your sublet and do it themselves - or do they just want some rent for a while?

If you really want to do it, and are qualified to do so, why not approach them to go in with you, ask them to finance the purchase of the main item, or whatever, and in return, you work on a 50/50 for them, until the equipment is paid for. There is always a deal to be done, approach them with an option and go from there.

No risk to you or them if it is as viable as you think and worth the risk of 20k...

If its viable enough, they will do it....

Jex

paddyrg

Jex has a good point re the centre part-funding the capital outlay, they may be interested for you to attract new business through the doors? But I would personally still look to rent even if it costs you more initially - cash and cashflow are crucial in the early days of trading, far better to have £100 in the bank than £120 theoretical stock/equipment value!

confusedlittlebunny

thank you all i have taken heed of your advice. some quite blunt but a true reality check......:)

paddyrg

Hope it goes well, CLB!!