Support Structures

Have you got what it takes?

An entrepreneur is a person who:

has a vision for his/her business and a passion to make it work.

must have leadership and people skills.

must be energetic and be prepared to work hard and persist through difficulties.

must not expect that starting a business is “a get rich quickly” scheme.

must be be prepared to listen to other people and learn.

Take the Entrepreneur aptitude and readiness assessment here

Business basics

As an entrepreneur you should:

give your business an appropriate name, this is important in that it will identify your business to your customers and in time it can create what is known as “brand equity”.

keep your business transactions separate from your personal transactions and this will mean having a separate bank account for your business.

keep accurate accounting records. This is essential so that you can know how your business is doing – such information is also essential in helping you make business decisions.

draw a salary from your business (assuming you do not have other sources of income). This should initially be kept to a minimum.

Writing a business plan

The purpose of a business plan is to put down on paper your business idea, your own goals, objectives, and your funding requirements. Four key areas for the business plan are:

The Business Itself (an overview of the business)

Details of what you plan your business to be. It may be making and selling something or providing a service. What will the business form be ? e.g What is the mission of the business?

The Management of the Business

Will the business be run by one person or a group of people – if by a group of people what will the different roles be. What are the skills and experience needed?

The Market in which the business will operate

Who will be the customers of the business? How will you attract these customers to your business? Will you have other businesses competing with you for the same customers? Will you use social media as a marketing tool?

Financial Management and Planning

The financial investment needed – equipment, working capital and expenses. A cashflow projection is an essential part of this. Costing of the products you are selling. Working out the sales breakeven level.

Preparing a Cashflow Projection

With any business, and in particular a new business, the cashflow is of great importance. This means projecting what cash will come into the business and what cash will need to be paid out. This needs to be done for the 24 months that the loan would be repayable over. For the business to be successful it must bring in more cash than it is having to pay out. It is also important to compare the actual cashflows to those projected – this may result in changes having to be made to the way the business is run.

The cashflow projection needs to include the following:

INFLOWS

  • loan received
  • sales made and money received (card and/or cash)

OUTFLOWS

  • equipment and other capital items
  • cost of buying goods for resale
  • operating costs
    • rent
    • electricity
    • packaging
    • transport
    • wages (for anyone helping you)
    • your salary
    • loan repayment

By subtracting the outflows from the inflows you will arrive at your net cashflow.

Monitoring and mentoring

In striving to ensure that each and every micro business funded by the GCBDT becomes successful, the supportive roles of the monitors and mentors are key. Key aspects of these roles are:

MONITORS:

Must have regular monthly contact with the entrepreneur to conduct a review of the business covering:

    • financial transactions
    • banking
    • monthly cashflow statement (to be shared with the trustees and the mentor)

MENTORS:

Regular contact with the entrepreneur for:

    • guidance
    • motivation
    • emotional support
    • role modeling
    • helping to set goals
    • identifying contacts and resources