Starting a business advice

50Twuncle

A friend of mine is planning to expand a small business locally - he has been working from home for about 2 years - he has found suitable premises and has even drawn up plans for the internal mods to the building - but has yet to even find an IFA - this concerns me - since he is about to visit his bank manager to discuss a loan
Could someone please confirm that I am correct to be worried about the order of doing this ?
I would have thought that finances would be the first thing to set up.....

steve1980

Why would he need an IFA?

Annisele

IFAs don't generally give advice to new businesses.

Do you mean an accountant?

mizzbiz

I agree - I can't see any need for an IFA whatsoever in this case. An Independent Financial Advisor will advise on personal investments, pensions etc. If he has successfully run a business for two years and is expanding, there is little to say that he even needs an accountant at this stage, although do you know that he doesn't have one?

From what you say, he knows what he is doing. Going for a business loan (although not something I would personally do if I could avoid it) is not really call for any drastic action - it's something millions of small businesses do every day.

50Twuncle

Thanks - I was just wondering if an IFA could advise on different sources for funding ?

steve1980

They probably can but they'll charge a fortune for something your friend can do for free.

paddyrg

Also, your friend is probably right to be talking with their own bank first - for a business loan they will want to see that he has the reserves to guarantee it, or at least that he has manintained a healthy domestic account for years and has ~35% of the loan amount as his own money. An IFA would probably bring nothing to the table, they want to sell you health insurance and mortgages, not business stuff. In fact, some of the IFA's I've met would be the last people I would ask for any kind of business advice, as their view of the market is not nearly broad enough to encompass different business models.