Bank of Ireland Business Coaching Series: Top ... - Business Banking

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Bank of Ireland Business Coaching Series: Top ... - Business Banking

Business BankingBank of IrelandBusiness Coaching Series:Top Tips for StartingYour Business


A2Business BankingOur best businessstart-up packageis worth shouting aboutTalk to yourlocal Business Adviserat Bank of Irelandabout making yournew business a successwww.bankofireland.ie/businessTerms and Conditions apply. Bank of Ireland is regulated by the Financial Regulator.


Contents4. What our Business Advisers bring to the table5. About Bank of Ireland6. Top Ways to Raise Finance for Your Business7. Top Tips When Approaching Your Bank for Finance8. Top Areas to Include in Your Business Plan11. Top Tips on Franchises as a Business13. Top Tips When Marketing Your Business16. Top Tips to Save Time and Money When DealingWith Your Branch17. Top Business Banking Products18. Top Reasons Why Businesses Fail20. Top Websites for Support21. Top Business Quotes from Entrepreneurs22. Useful Contacts23. Notes23. Disclaimer3


What our Business Advisers bring to the tableBank of Ireland Business Advisers have on average 12 years business bankingexperience. They have typically worked their way through many branch rolesprior to becoming a Business Adviser. This has enabled them to gather and buildthe knowledge they need to be able to advise your business.• We have Business Advisers in every Bank of Ireland branch in the country,dedicated to supporting our business customers’ needs.• All of our Business Advisers are fully qualified financial advisers and mustcontinue studying every year to maintain this qualification.• Our Business Advisers are familiar with their local market and understandwhat is happening in their local business community.• Our Business Advisers have access to a wealth of information and advicethat is second to none. Our business customers can expect the very bestadvice and guidance in a range of areas – not only banking products andservices.• All of our Business Advisers have a genuine interest in business and theiroverriding goal is to help your business succeed.At Bank of Ireland we are well aware that good people do business with goodpeople, this is why we are committed to having some of our best people asBusiness Advisers. Our Business Advisers are ready and waiting to help you.Arrange a meeting with your local Business Adviser today.Visit www.bankofireland.ie/business to make an appointment with a BusinessAdviser.4


At Bank of Ireland, we know that small businesses play a significant role in theeconomic growth and development of the Irish Economy. If you’re thinking aboutstarting your own business we can offer a wide range of help and expertise.Starting your own business requires a lot of thought and planning. We havebusiness advisers in every branch, who are dedicated solely to small businesses.They can help your business get off to the best start possible.Our Business Start up Package has been designed to help you every step of theway. It includes:• A range of current account banking services free of charge fortwo years*• Free monthly subscription fee for two years to levels 1 and 2 ofBusiness On Line, our award winning online service**• A range of exclusive third party offers that will help your new business***• A competitive small business loan of up to e200,000****• A Visa Business Card with annual fee waived for the first year*****To find out more call in to your local branch and meet with your BusinessAdviser.* Offer is available for a two-year period from the date of opening a Business Start-Up CurrentAccount with Bank of Ireland. Other charges may apply; please refer to the ‘Schedule of Fees &Charges for Business Customers’ brochure, which is available on request at any Bank of Irelandbranch.** The exclusive offers are available anytime within a twelve month period from the date of openinga Business Start-Up current account with Bank of Ireland. Terms and conditions apply to BusinessOn Line Levels 1 & 2. Additional E-banking services are not covered by this package. For furtherinformation, contact 1850 264265.***The exclusive offers are available anytime within a twelve month period from the date of openinga Business Start-Up current account with Bank of Ireland. Bank of Ireland does not give anyrepresentations or warranties about the firms used in the scheme and does not accept anyliability in respect of the advice or service provided in any circumstances.****Offer is available anytime over the two-year period from the date of opening a Business Start-Upcurrent account with Bank of Ireland. Lending criteria and terms and conditions apply. Also, If the‘Competitive Small Business Loan’ being referred to in the document is a ‘fixed rate loan’, then weshould probably include the following warning in bold and in a box:Warning: You may have to pay charges if you pay off a fixed rate loan early.*****Lending criteria and terms and conditions apply. Offer is available anytime over the two-yearperiod from the date of opening a Business Start-Up current account with Bank of Ireland.5


Top Ways to Raise Finance for Your BusinessThere are various sources of finance available when starting or developing yourbusiness. It is important to consider the suitability and benefits of each source.SelfBanks like to see business owners investing their own money into the business.It shows that you are committed and believe that the idea will work.Family, friends, outside partiesFriends and family are a good source of capital. However when consideringoutside investment there are a number of steps you should take:• Get an agreement in writing.• Emphasize debt (loans) rather than equity (ownership)• Put some cash flow on their investmentVenture Capital FundA venture capital fund provides money for investment in exchange for a stakein the business. You will also have the expertise and advice of the venturecapitalists at your disposal.Internal Company SourcesThis is the cheapest way of finding funds. You can find funds internally by:• Collecting money from debtors quicker• Reducing stock levels in proportion to sales• Negotiating longer credit with suppliersThese methods will free up money which can be invested back into thebusiness.State SupportCounty and City Enterprise Boards provide a variety of financial supports toassist the start up, development and expansion of small businesses. For moreinformation on the support available visit the websitewww.enterpriseboards.ieBusiness BanksBanks offer a wide range of finance products suitable for all stages of yourbusiness. You will also benefit from having the expertise and advice of yourbusiness adviser. You will need to sell the idea of your business to the bankwho will then assess the risk of the proposal.6


Top Tips When Approaching Your Bank for FinanceBe preparedIt is essential that you are adequately prepared particularly in your first meeting.Make sure that you have a business plan drawn up and that you can answer anyquestions that may be asked about it.Get professional adviceYou should meet with an accountant or adviser to help verify your projectionsand plans. The bank will be expecting you to be able to explain all your financialprojections.Make sure you consider all costsWhen drawing up your financial projections make sure you consider ALL costs.For example, don’t just consider the cost of equipment; also consider how muchit will cost to install the equipment.Put money and resources into the proposalBefore lending you money, your bank will want to see evidence that you believeyour idea will work. Putting time and money into your business will show thebank that you are willing to take risks to make your venture a success.Make sure you obtain the right type and level of lending facilityThere is no point in asking for €10,000 if you think further down the line youmight need €20,000. Do your research from the beginning and this will save youa lot of time and money in the long run.Be honestIt is important to be honest about your strengths and weaknesses. If you have apoor credit history, let your business adviser know as they will find out eventually.7


Top Areas to Include in Your Business PlanThe business plan is the most crucial document, not just for the bank, butalso for you.Some tips for writing your business plan are:• Make sure it’s your plan• Meet with an accountant beforehand• Know the market• Present realistic projectionsYour business plan should include:Executive SummaryIn this section you should summarise the key points of your plan.It should briefly explain the following:• How the company came about• Intended products/services• Target market• How the company intends to reach that market• Product costs• Financial projections• Grant requests based on equity already committed/loans agreedIntroductionYou should use this section to set out the basic information that the reader willwant to know about your business. This should include:• The purpose of the plan• Business name• Contact details• Business start date• Business objectives• Product/service range8


Project Outline This section should give the reader more information about thebusiness and an idea about what you want to achieve from your business. Itshould include:• Description of the business• Mission statement• Industry details• Any targets that have been setOwnership and Management You should use this section to explain to thereader what skills/experience you have to make the business a success. Youshould include:• Education• Work experience• Any other experienceMarketing In this section you need to give the reader information about yourtarget market. The reader will need to see detailed information on the following:• Overview of the market• Target customers• Competition• Promotion• Competitive advantage• Delivery channelsProduction This section should be used to explain your product/service. You willneed to let the reader know:• How the product is made/delivered• Any experience you have with the process• What equipment is needed• How you will assure quality• Where you will source suppliesFinancial In this section you should set out a summary of your financialprojections. You must ensure that you can withstand questioning of yourproposal. You should include the following in this section:• Profit and loss account• Balance sheet• Cash FlowIt is important to ensure that these numbers reflect the plan as described inprevious sections.9


Funding Proposal This is a very important part of the plan as you are letting thereader know:• How much you need• How much you have of your own• How much you have obtained from other sources?Did You Know• 50% of businesses without a plan will fail.• More than 80% of businesses with a plan will succeed.10


The Irish Franchise Association,30 Tolka Valley Business Park, Ballyboggan Road, Dublin 11.Tel: 01 8134555, Email: michaelbradley@irishfranchiseassociation.comwww.irishfranchiseassociation.comTop Tips on Franchises as a BusinessIs it for you?Although many people explore the franchise option, it is not for everyone. If youagree with the following statements, the chances are you are more open tofranchising than the individual who always wants to do things their own way:• I would value the back-up and support provided by franchising.• I would like an operating system that I could follow in the running ofmy business.• I would happily trade under a franchise brand.PreconditionsThe following are all conditions necessary before you consider turning yourbusiness into a franchise:• A profitable track record• Name protection• A clear identity• A transferable operation• Management depthSelecting a FranchiseThere is a wide range of franchises available so it may help to narrow your choicethrough the following key questions:• Does the franchise have a proven track record?• Does it have the 4 elements below?• Can you identify with the concept?• Do you have the necessary finance?Four Elements of FranchisingThe four elements of franchising are:• A legal contract• Training• An operations manual• Ongoing supportIn return for the rights to the business system the franchisor charges an initialfranchise fee and takes a percentage of the franchise turnover.11


RiskStarting a business as a franchise is less risky than setting up your own businessfrom scratch. We recommend that you prepare a Business Plan to guide you.That doesn’t mean it is less challenging or without risk. A well-establishedfranchise system will provide all the hands-on experience, operational inputand marketing support you need. Bank of Ireland is therefore keen to assist thefranchise sector.Get Independent AdviceAll franchises involve contractual obligations and you will need a solicitor familiarwith franchise agreements to review your agreement with you. You will also needan accountant to assist and advise on the financial aspects of your business.12More InformationThe following websites are useful for more information regarding franchises:• Franchise Direct www.franchisedirect.com• Bank of Ireland www.bankofireland.ie/business• Beauchamps Solicitors www.beauchamps.ie• Franinfo UK www.franinfo.co.uk


ProductA product is not only the product itself, but also the services and intangiblesaround it, such as quick service and atmosphere. It is important to offer thecustomer a choice, for example, a clothes shop does not just sell clothes-it alsosells accessories.It is also important to consider packaging, service, personal attention, brandarticles, originality and creativity.PlaceThis refers to where your business will be located. Before choosing a locationyou should ask yourself the following:• What will the customer see when he/she visits your premises?• Is it easy to find?• What does the area look like?• What draws customers to the location?• Do you need to provide a location map for customers?• Why did you choose the location?It is also important to consider the channels of distribution. The fewer the stagesbetween the original manufacturer and end customer in a distribution channel,the lower the distribution cost. You should try and balance distribution costswith promotion costs. Often sales channels with low distribution costs have highpromotion costs.PriceWhen deciding a price it is important to consider what your customers are usedto paying and what they are willing to pay. It is important to research competitor’sprices. Be careful when researching price. People will tell you straightaway if yourpricing is way off line. However, if it is a little dear for them, they may not want toadmit that they can’t afford it and they may say that the price is fine. Also, peopleare unlikely to tell you if your product is too cheap. Talk with your accountant toensure price covers costs plus a margin.14


PromotionMarketing does not begin and end with advertising. Some other areas youshould consider are:• Direct Mail-This involves sending a sales letter/brochure to customerswithin your target group.• Personal Selling-This is the process of communicating face-to face witha potential buyer with the purpose of selling a product or service.• Public Relations- This includes all the activities you undertake to getpositive attention for your business among the public in general,e.g. public speaking, press releases. Good PR will create a positiveimage for your business and ensure that people remember you.?Did You Know• 95% of small firms are Irish owned• Over 20,000 new firms are established in Ireland each year• Small firms contribute to 40% of income taxes• 98% of services firms are ‘small’• Over 100,000 foreign nationals work in small firms• Small firms are essential in the supply chain for largecompanies• More businesses are trading overseas• 10% of the workforce are ‘new Irish’• Services account for over 70% of GDP and employment15


Top Tips to Save Time and Money When Dealing With Your BranchTimeMeet the right adviser at the right time. A good banker can be an excellentsource of advice and information. Anything you can learn from your bank willhelp you avoid misunderstandings and problems further down the line.Use cards for small expenses. By using a business credit card to pay for smallexpenses you can set the most appropriate credit limit for each employee. Thiswill mean you don’t have to authorise each individual transaction.Use your branch’s Priority Cash system. A Priority cash system allows you todeposit your cash without having to wait for it to be counted and checked. Youwill also avoid queues. Every Bank of Ireland branch has a Priority Cash facility.Know your needs upfront. If you know what you are looking for from your bankat your first meeting it will mean that you do not have to go back further downthe line.Use online and phone channels. Online and phone channels allow you tocheck transactions and make payments without having to go to your branch.MoneyAuthorised Limits. If your present limit on your current account is insufficient,discuss an increased limit with your business adviser. This will save you having topay a charge which will be levied if your account goes beyond the overdraft limit.Use online and electronic transfers. By doing this you will save on transactionsfees, stamp duty, postage and your own administration.Choose the right deal. When choosing a bank; it is important to shop around.For example, Bank of Ireland offer two years free banking for business start ups.*Notes withdrawn. You could avoid charges for notes withdrawn bycomputerising all staff wages, writing cheques instead of paying cash and usinga business card to cover employee expenses.16


Top Business Banking ProductsOperational:Business Current Account. This is essential to the smooth day-to-day runningof your business. It will allow you to make/receive payments, track transactionsand monitor your cash flow.*Online Banking.* Online banking gives you total control over your businessfinances 24 hours a day, seven days a week. It offers the following benefits:• Time savings with fewer trips to your branch required• Increased efficiency due to less paperworkDeposit Account. This facility gives a good return on surplus cash over a shortterm period, with easy access to your funds.*Financial:Business Overdraft. From time to time, most businesses will need accessto cash over and above their normal cash flow. This form of finance is used inconjunction with your current account and provides a flexible, convenient form ofshort term working capital.**Business Credit Cards. A short term means of paying bills and makingpurchases. A business credit card will simplify the expense reconciliation processand make cost savings.**Invoice Financing. This facility gives you fast access to working capital byallowing you to convert your debtors to cash before the invoice payment date.**Insurance Premium Finance. By spreading the cost of your business insurancepremium over the year you can avoid large one off payments and free upworking capital.**Business Loans. This option offers you funding to suit every stage in yourbusiness.**Leasing and Hire Purchase. You can obtain 100% finance by leasing or hirepurchase to fund fixed assets or premises fit-outs. Repayments can be tailoredto match income and cash flow, and aid the seasonality of your business.***Terms and conditions apply**Lending criteria, terms and conditions applyWarning: In case of Hire Purchase you will not own these goods until the final payment is made17


Top Reasons Why Businesses FailUnfortunately a large number of new businesses in Ireland fail in their first fiveyears. Obviously no one wants to see their business fail, so it is important to beaware of some of the common reasons why new businesses fail.An inadequate business planA well thought out business plan forces you to think about the future andthe challenges you’ll face. You’ll have to consider your financial needs, yourmarketing and management plans, your competition and your strategy forcoming out on top. It is important to plan ahead at every stage of your business.OvertradingGrowing too rapidly creates risks such as loss of control and overextendingyourself financially. It is important to start with realistic goals and give yourselftime to grow.Underestimating the competitionIt is essential to monitor changes in your market, any existing businesses willtake steps to defend their customer base. Do not underestimate competitorreaction to your new business and do not assume your customers will be loyal.Watch your competitors as closely as you would your own employees.Failure to changeIt is essential to monitor changes in your market, changes in competitorbehaviour, changes in consumer trends/preferences, and to adjust to thesechanges. Having the ability to adapt to changing times is a key ingredient tosurviving in the business climate.Ineffective marketing/promotion. It is important that you advertise andpromote your business in a cost-effective way. After all, if customers don’t hereabout you they won’t know that you exist.OverspendingProblems will arise if there is more money going out of a business than there iscoming into it. When starting out in business, it would be a good idea to seekadvice on managing cash flow from an accountant/adviser. If you do have a cashflow problem, don’t ignore it. This will only lead to more problems.18


Poor ManagementMany new business owners lack relevant managerial experience in importantareas, such as finance, production and marketing. When starting a business it isuseful to talk to a business adviser who can support you.LocationThere are many key factors to consider when choosing a location for yourbusiness. These include competition location, where your customers are,accessibility, local incentive programs for business start ups and condition/safetyof premises.Inadequate protectionIt is important to take protection against unexpected events, such as flood, fire,theft and loss of key personnel.Small customer baseTry not to rely on one or two large customers as you will face problems if theydecide to go. By broadening your activity base you will also broaden yourcustomer base.19


Organisation Website For?Business Angels www.businessangels.ie Investor supportEnterprise Ireland www.enterpriseireland.ie Business plan template, cashflow projectionsFinfacts www.finfacts.ie Finance factsIDA Ireland www.idaireland.com Overseas investment,foreign direct investment,IrelandIrish Small & Medium www.isme.ieEnterpriseThe IndependentBusiness OrganisationIrish Exporters Ass. www.irishexporters.ie The voice of the exportindustryOak Tree Press www.oaktreepress.com Business publicationsPlato www.plato.ie NetworkingSmall Firms Ass. www.sfa.ie Economic, commercial,employee relations andsocial affairs advice andassistance.Chambers Ireland www.chambers.ie Business NetworkingFAS www.fas.ie Range of services andadvice for small businessFirst Step www.first-step.ie Provides loan collateral to helpbusiness development with nocollateral necessaryStarting a Business www. Information, advice andstartingabusinessinireland. resources.comKrishna De www.krishnade.com Building your brandActionCOACH www.action-ireland.com Business coaching20


Top Business Quotes from Entrepreneurs“People buy into the leader before they buy into the vision.” John C.Maxwell“Learn to make numbers talk! They will speak to you about hard truths and alsoreveal the future!” John D Rockefeller“You can’t overestimate the need to plan and prepare. In most of the mistakesI’ve made, there has been this common theme of inadequate planningbeforehand. You really can’t over-prepare in business!” Chris Corrigan“The world is changing very fast. Big will not beat small anymore. It will be thefast beating the slow.” Rupert Murdoch“I have always loved the competitive forces in this business. You know I certainlyhave meetings where I spur people on by saying, “Hey, we can do better thanthis. How come we are not out ahead on that?” That’s what keeps my job one ofthe most interesting in the world.” Bill Gates“Most new jobs won’t come from our biggest employers. They will come fromour smallest. We’ve got to do everything we can to make entrepreneurial dreamsa reality.” Ross Perot“Nobody talks of entrepreneurship as survival, but that’s exactly what it is andwhat nurtures creative thinking.” Anita Roddick“A business has to be involving, it has to be fun, and it has to exercise yourcreative instincts.” Richard Branson“A step backwards is a step in the right direction if you are facing the wrong wayto start with.” Jaime Smith“Method goes far to prevent trouble in business; for it makes the task easy,hinders confusion, saves abundance of time and instructs those who havebusiness depending, what to do and what to hope.” William Penn“We were young, but we had good advice and good ideas and lots ofenthusiasm.” Bill Gates21


Useful ContactsBank of Ireland Business Banking40 Mespil Road, Dublin 4Tel: 01-665-3434Website: www.bankofireland.ie/businessCity and County Enterprise BoardWebsite: www.enterpriseboards.ieChambers of Commerce of IrelandNovara House, 3 North Earl Street, Dublin 1Tel: 1850-668272, Website: www.chambersireland.ieCompanies Registration OfficeParnell House, 14 Parnell Square, Dublin 1Tel: 01-804 5200, Website: www.cro.ieIrish Patents Office Government BuildingsHebron Road, Kilkenny, IrelandTel: 056-7720111, Website: www.patentsoffice.ieIrish Franchise Association30 Tolka Valley Business Park, Ballyboggan Road, Glasnevin, Dublin 11, IrelandTel: 01-8134555, Website: www.irishfranchiseassociation.comRevenue Online ServiceTel: 1890 20 11 06, Website: www.ros.ieEnterprise IrelandHead Office, Glasnevin, Dublin 9Tel: 01 808 2000, Website: www.enterprise-ireland.com22


NotesDisclaimerThis document has been prepared by Bank of Ireland Business Banking for informational purposesonly. Not to be reproduced without prior permission. Any information contained herein is believedby the Bank to be accurate and true but the Bank expresses no representation or warranty of suchaccuracy and accepts no responsibility whatsoever for any loss or damage caused by any act oromission taken as a result of the information contained in this document. Unless specifically statedotherwise, no prices or rates mentioned are bids or offers by the Bank to purchase or sell any currencies,securities or financial instruments. Except as otherwise may be specifically agreed, the Bankhas not acted nor will act as a fiduciary or financial or investment adviser with respect to any derivativetransaction that it has or will execute. Any investment, trading and hedging decision of a party willbe based on its own judgement and not upon any view expressed by the Bank and shall be basedon an arms length negotiation with the Bank. You should obtain independent legal advice beforemaking any investment decision.


Bank of Ireland is regulated by the Financial Regulator

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