FINANCING YOUR BUSINESS

As stated elsewhere in this web site, securing financing for your business is one of the most difficult tasks facing the small business entrepreneur. Seeking the assistance of a SCORE Management Counselor and a good banker is nearly mandatory, but you can acquaint yourself with the financing-related issues by taking advantage of the Arizona District SBA web site. This site is located at: www.sba.gov/az  and it is similar to the National SCORE site and contains a wealth of information, especially regarding financing.

Select the Financing link in the site and you will find a variety of information, including the following topics:

1. Financing Basics – this section presents a checklist of questions you will need to answer before you pursue financing needs. Also discussed is debt and equity financing and the basic facts about each.

2. Estimating Costs – an accurate estimate of start-up costs is vital to the financing process. You will need to determine the costs of start-up for at least the first six months of your business operation. This section outlines those costs that you need to consider.

3. Finding Capital – this section explains the various types of financing that may be available to you and the difficulties associated with each. How to write a loan proposal and how it will be reviewed by the lender is also presented in this section with a reference to the National SBA web site for more information about SBA Financing Programs.

4. Personal vs. Business – the importance of your household budget when starting a business and links to credit agencies for determining your credit score. An adequate credit score is vital to obtaining funds from any lending institution.

5. Applying for a Loan – a critical discussion of all the elements of the loan application process and information about the 5 C’s of credit.

6. Small Business Lenders – lists those lenders in the state who are considered certified and preferred lenders by the SBA. These lenders are those qualified to work within the SBA financing programs to provide SBA guaranteed loans to small businesses.

7. Cash Management – includes an important discussion of the elements of cash flow and the importance of sound cash management techniques in a small business.

8. Start-up Costs – a further discussion of start-up costs and a link to a start-up costs calculator to assist the small business planning process.

9. Break/even Analysis - Breakeven analysis is a tool used to determine when a business will be able to cover all its expenses and begin to make a profit. This section also contains a link to a site offering an automated break/even calculator.

10. Financial Statements – a basic discussion of the balance sheet and income statement and refers you to an SBA template to use in developing your own financials.

11. Specific Training – offers a complete listing a many business courses you can take by going to the appropriate link. Courses cover business management, marketing, business planning, government contracting, eCommerce and more.

You should acquaint yourself with this fine Arizona SBA web site. There is much more in the site beyond the financing section.