3 Useful Things to Consider When Starting Up a Commercial Cleaning Business

Starting a commercial cleaning business involves completing several important steps. With the low start-up costs and high demand for this type of service, there is every opportunity to build rewarding and profitable business. Here are a few things to consider in the process of getting set up:

Business plan

A major first step is to create a solid business plan. A good plan should include a detailed look at your company, the services you intend to offer, financial data like income statements and cash flow and strategies to obtain customers. Plus, it can help to provide an action plan on how you aim to achieve your profitability goals.

A well written business plan should be seen as an outline for your business success, and can be referred to in times of gaining finance or getting things accomplished. This type of plan needs the most care if hoping to use it in an effort to obtain a business loan from a bank or other lender.

Target Market

It is certain to make it easier to apply the proper strategies to get customers if you know your exact target market. Even though you intend to work in the commercial sector, you still want to break this down into something like smaller retail locations or large office complexes. By being really focused it is a lot easier to put in place the right advertising and marketing strategies.

Independent vs. Franchise

It is essential to fully research the options of running an independent or a franchise business. A major benefit of the franchise business is the ability to work with an established brand name while also having full operational and marketing support in the background. Plus, when buying into a franchise, the investment includes in-depth training to make sure you have the knowledge to be successful from the start.

A downside of this type of arrangement is higher up-front fees and ongoing monthly fees payable to the franchise owner. Also, there may be business limitations in place, such as not offering certain services and imposing advertising restrictions.

On the other hand, the independent run operation is certain to appeal to the business owner that prefers to have complete control and is more flexibility. Plus, it is possible to offer the services you want and get to keep 100% of the profits. But, it will be necessary to have a sufficient budget in place to market your commercial cleaning business to an already established market.

3 Common Mistakes Made While Seeking Bridge Finances and How to Avoid Them

Many borrowers simply do not understand how the bridge financing works as it was somewhat of a foreign concept until recently. So, while applying for bridge loans, many borrowers make mistakes that could affect the final outcome of their loan application.

Bridge loan lenders are not miscreant finance sharks who are looking to take advantage of the desperate people (borrowers). The rate of interest for a short term bridge is higher than what is provided by any conventional lender. But, these finances provide money to the businesses and individuals that don’t fit within the conventional lending box such as banks and other establishments.

But for these financing solutions, there aren’t many real estate projects with opportunities for developing and reaching their true potential. A short term bridge loan can be just the type of funding the investors require to keep their commercial investment plan running smoothly and efficiently. In this post, we will discuss about some of the common mistakes borrowers make while applying for a bridge loan and how such mistakes can be avoided.

Mistake #1: Focusing on the interest rate

Based on their experience and knowledge of this domain, commercial loan brokers can help borrowers get the lowest interest rate on bridge loans. Apart from the low rate of interest, it is important to know that borrowers should also take into consideration the time and loan fees. Common sources of bridge finance are private companies or individuals who are interested in getting better returns on their investment. A borrower could miss out on good lending options by focusing too much on the rate of interest of the bridge loan, depending on the length of time they hold the loan for.

Mistake #2: Applying for a loan without having an exit strategy

A borrower should avoid entering into a short term bridge loan without having the proper exit strategy. They should consider how many loans they are able to realistically afford and how much time they have to pay back the finances. A steep default interest rate increase is usually triggered when a borrower falls behind on their loan repayments or defaults on their finance. This sudden increase in the interest rate can be substantial and can make loan payments difficult to maintain. One of the best exit strategies for a bridge loan borrower is to borrow money when it is extremely necessary and they have a plan to pay off the loan before the end of the term.

Mistake #3: Not providing the bridge lender with a story

Traditional lenders are straight forward in their finance process. A credit report, loan application, recent bank statements and two years profit and loss statements are usually all that is required by a borrower for the purpose of pre-approval or denial of their loan. When applying for a bridge loan, story by the borrower can influence the decision of the lender to provide the bridge loan as soon as possible. With the right kind of story, a bridge lender might consider providing the borrower with quick finance in order to deal with low credit scores, tax liens, a development project and pending foreclosures. Borrowers usually spend inadequate time to explain the story behind their request for finance.