What is the best way to get funding for my small business expansion?
I have been operating a small business out of my home for the past two years selling live koi and pond supplies. Business has been good and I love the tax deduction. But I am out growing my backyard and I have set up a deal with a local nursery to sub lease me 3500 sq ft of land for $1500 a month….not too shabby. But now I need the funding. Setting up tanks and filters will cost apx $20,000, not including labor. Then I need to build some sort of shade structure, another $10K, buy more inventory, $10K to $15K, and launch a marketing campaign. So I figure I need at least $50K just to get started. I have a credit line available to me for at least 40K, but I don’t want to use it as it has a high rate. Should I get an SBA? Those are such a pain. Search for an investor? and even bigger pain. I am working on my business plan as we speak. Just wondering what the best way to go is.
Any ideas?
Answer
Go to your local bank. Most banks loan money to existing businesses with just the business and personal guaranty. It is usually a percent of sales that they would lend to. The SBA would only need to be done if the bank does not think that your personal credit or business credit is good enough. The SBA does not loan money. They only guaranty the bank that a portion of the loan is guarantied by the government. Go to Bankofamerica.com under small business and apply for a business loan.
