This is a question that many business owners will struggle with at some point or another. If you’re thinking of expanding your company in some way or need the money for general working capital, timing can be everything.
Here is Maple Accounting’s helpful guide to knowing when it is time to raise finance for your business.
Ask yourself why you’re looking for funding.
If you already see what you want the future to hold for your company, you may already know the steps you need to take to get where you want to be.
Whether this is expansion in the form of more branches, more staff or more high-tech equipment, knowing exactly what it is you require funding for will help you work out when you need to start applying for finance and how much.
Ask yourself these questions:
- What do I need the money for?
- How much will I need?
- Will this investment bring me closer to my goal?
How do you plan on expanding your business?
If you decide to secure funding to help your business grow, it is vital that you be sure the investment of time, money, and energy in that growth will be worth the effort. Raising finance is no easy task, and you’ll need to prove to a funder in a convincing way why you want the money and that what you want to do with the money will deliver the result you want.
Reasons you may need to raise finance to grow your business could include:
Investing in new and improved equipment can have a significant and positive impact on your overall efficiency. If a vital piece of machinery has broken down and it needs replacing, or you’re looking to update to newer technologies to keep your company competitive, raising finance will get you what you need faster in all likelihood than waiting for the amount of cash in your bank to grow.
With more staff onboard, your customers get more face time; improving overall satisfaction and potentially leading to more sales.
You may also plan on growing the space your business has to work in. An additional warehouse or additional offices could significantly increase productivity, giving you the space you need to house your new hires, new equipment and new stock.
Opening new branches of your business allows you to grow your marketplace; reaching new customers in places you may never have been able to before. Setting up shop in a new town also helps to spread your brand name further, all helping you to grow.
Digital marketing is quickly becoming one of the critical aspects of business growth. With more and more consumers now shopping online, investing in web- and app-based marketing and advertising essential in order to fuel business growth for your firm.
So, is now a good time to raise finance for my business?
It can be a huge challenge to raise significant amounts of cash if your expansion plans are still only at the ideas stage. Proven successful entrepreneurs may find it easier to secure funding at this stage, but investors can still be hesitant to offer finance without substantial evidence that they will get their money back and more.
The best time to start raising finance for your business will be when you already have traction. If you have a loyal customer base, demand for your product or service and are financially secure enough to support yourself without needing to use the finance for everyday expenses; then funders are more likely to back you.
Where can I access business finance?
If you think now might be the time to start raising finance for your business, speak to the Maple Accounting team today. We can offer our professional advice and guidance on everything from securing funding to business planning. For further information, you can email us at firstname.lastname@example.org or call our head office on 01332 207 336.