Business Start-Up – The Finances

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When you’re just starting, how to run a cleaning  business  is not as much of a concern to you nor are cleaning  business  opportunities. What matters is actually your capital investment. The house cleaning  business , especially if you start out as with residential cleaning services doesn’t really require much capital as compared to if you’re going to offer commercial services. However, the point still remains that no matter how small it may be, but you will still need a capital investment for your  business .

Now when it comes to the financing of your  business , there are actually two types of financing: equity financing and debt financing.

Debt Financing

Debt financing is the most common type of financing when it comes to starting a new  business . This kind of financing involves you, the owner, to borrow money, which includes loans, a lease, a line of credit, and the likes. This is the kind of debt wherein you pay interest in order to finance the original amount that you borrowed. You can avail of this kind of financing through banks, credit unions, lending companies, credit card companies, even suppliers, and so on.

Debt financing includes you and the money lender having an agreement on the terms of payment – how much to pay every due date, and every when is your due date. In order to avail of this, the financial institution first asks to see your house cleaning  business  plan, and basing everything on that, they will decide if you are a good investment for them or not. Thus, debt financing means applying for a loan – but not all loans are approved; only the bankable ones.

Equity Financing

Equity financing, on the other hand, doesn’t entail you to borrow money. Instead, that portion of the  business ‘ capital is provided by a partner or a stockholder of the  business . Having a partner takes care of the portion of the capital, and also opens more cleaning  business  opportunities with that person’s skills, area of expertise, and pool of prospective clients. So it is not only the finance that a partner helps you out with, it is also with other aspects on how to run a cleaning  business .

A cleaning  business  is simply like any other  businesses  out there. It needs your care, it needs your attention, and it needs your support. So treat it as you would treat a child that you value and love so much. For certain, that kind of dedication would make your  business  grow and rise to success. But remember, never ever stain your  business ‘ name or credibility – pay well.


Source by Janice Fowler

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