How to get business funding
One other email I received recently was from Jennifer, the owner of a successful bow company. Not only was she super sweet, she was in a position very familiar to many business owners. She has developed her business over the past 4 years, and it is growing at a rapid pace. She is a one-woman operation, and at the point where she needs to make some decisions...does she continue as is, or does she invest in the business and take it to another level. She needs the profits out of her business to support her family, so doesn't know were to get the funding to do so.
I'm sure most business owners can relate here. It is so tough to run your business with one eye on today and the other eye on 1 year from now, but that is really what is required of us. Is it the best business decision to sacrifice today to triple business in 12 months? Sounds like an easy decision, but as we all know, it really is not. There are a questions that I would have for Jennifer:
1) Where are the #s? Have you sat down to figure out what it would cost you to hire help per week? How much would you have to increase your sales to cover this cost? For me personally, this was a very tough decision when I finally gave in and hired our first employee. I wanted to do everything myself to save on the expenses, until one day I realized that me doing everything was actually costing us loss business. Now, as we have added to our team, it has become much easier for me. Do they pay for themselves in the long run? If this answer is yes, then the decision will be much easier.
2) What is your end goal? Do you want to grow the business and continue working it yourself? Jennifer mentioned in her email to me a dream of opening her own shop. If this is the goal, I would sit down and figure out what that would take. How much would you need to sell (and therefore produce) in order to make this profitable? Can you do that qty making them yourself? Would you be available to work the boutique or would you have to hire help?
3) It sounds like Jennifer has done her due diligence in researching funding. $$ is not the easiest to come by as a small business owner, especially in this day in age. I completely understand needing the profits out of your business to support your family. When it comes down to it, that's why we work in the first place. I would recommend websites such as entrepreneur.com as a great place to get ideas. This answer will be different for everyone, but really comes down to your ultimate goal/business plan and what makes the most sense.
I am definitely not an expert in business, but I am purely sharing my personal experience. What worked for me, may or may not work for you, but if one ounce of my experience helps others in theirs, then it is worth it.
For me, I am by nature, super frugal. So, when I started RuffleButts, I was trying to save every last penny. It was my worst nightmare watching the business bank account with all of those numbers listed on the debit side. I felt so much weight on my shoulders to make this work, for my own self pride, as well as for the future of my family. I was willing to do anything myself to not have to source it out and write a check. It took me about a year to understand that I needed to think much bigger. Sometimes it took me spending a little money to make more money. With that said, the decisions to spend money had to be made from a business only perspective. I am not a numbers person, but Mark certainly is, and sometimes it took him taking a basic cost, dividing that my our profit on an average sale, to come up with a break-even. This made my decisions much easier.
I'm sorry to say that I don't have any secrets here for you on funding, but I will say that with rational thought, and long-term goals, there is always an answer. If this is your dream, there is going to be a way to get there, one path just may take longer than the other. The only thing I will warn you, is to be sure that the numbers make sense 1st. Since Jennifer has already found success in her business, this decision may be easier than for some others, but as entrepreneurs, hopefully you are always on a path of growth. Just make sure you stay focused on that path and keep your compass nearby.