GRCA Commerce Quarterly Summer 2019 - 18

small business matters

ARE YOU READY TO ENTER
THE BUSINESS PLANNING PIT?
By Jobany Bedoya, Greater Reading Chamber Alliance

[Editor's Note: This is the second in a series looking at
what it takes to start up a small business.
The previous article tackled loan readiness.]

A

fter you have considered loan readiness, you are going to need
to do some market research and the S.W.O.T. analysis, which
stands for Strengths, Weaknesses, Opportunities, and Threats.

Now you're ready to get a little deeper into the business planning
pit, which is the part that usually scares people away. The "pit" is
what I refer to as the financial data analysis. Not only is it difficult to
grasp for most people but it's annoying, frustrating, time-consuming,
and many other adjectives that I can use to describe it. Sometimes
business owners fear stigmas that come along with it, which could
be the awkwardness of sharing personal financials, questionable
credit history, bankruptcy, foreclosures, and more.
Fear not, many entrepreneurs struggle with the same things. A
lot of times you don't realize how risky it is to leave the comfort of
your nine-to-five job with benefits and retirement to start something
on your own where your next paycheck or cash flow isn't guaranteed,
insurance costs are astronomical (if you're fortunate enough to even
have insurance), and your eight-hour day turns into a 14-hour day!
Sometimes it's just part of your journey but when you're ready and
serious about self-employment, you must take care of those things
and repair any credit issues as soon as possible before moving on.

18 COMMERCE QUARTERLY SUMMER 2019

If you are struggling with credit issues, here's the point in your
business plan where you STOP. This is where you focus on repairing
your credit history and work on ways to maximize your credit access
opportunities. It's much nicer and easier when you borrow money
under 10% versus bad credit, which yields rates as high as 30%. If
you fall into this trap, it is going to most certainly kill your business's
future. Trust me, I speak from personal experience when I used a
credit card at 24% interest. The payments on interest only were so
overwhelming that I couldn't keep up, which lead to the closing of
my first business venture.
This is another way I can assist you throughout your journey,
by providing that one-on-one mentorship. As a certified SCORE
mentor, I can guide you throughout your journey and help you
assess and understand the roadblocks you might face. We can also
work with GRCA partners such as ASSETs, an organization that
does micro-lending, technical training, and credit repair all at the
same time.
Next month I will continue the discussion regarding your
financial planning and will cover cash flow statements, income
statements, and other items that will allow for you to access the
cheapest capital you can get. The final thing I want to leave you
with is, there is no such thing as free money or grants so it's very
important you work on your credit.
GRCA Commerce Quarterly Summer 2019

Table of Contents for the Digital Edition of GRCA Commerce Quarterly Summer 2019
