Lending Library

What is a GPO and How Can it Help Your Healthcare Business?

December 7, 2023

Suppose for a moment that you wanted to install a fence in your backyard. As you obtain project bids from various businesses in your area, you begin to realize that the cost for the fence would exceed your budget. Then you have a brilliant idea—you call five of your neighbors and ask if they’d also be interested in getting fences in their yards. Two of your neighbors say they are interested.

When you call your favorite fence company and explain that there will be three neighboring homes getting fences, they lower the cost substantially for each of you. After all, they will already have all their equipment and installers on site, and they’ll get a discounted price on the vinyl fence pieces because they’ll be buying it in bulk for this project.

If you’ve ever experienced a scenario like the one described above, you have successfully leveraged group buying power and secured a better price for yourself and others. A group purchasing organization (GPO) uses the same approach to empower doctor’s offices, hospitals, and other healthcare facilities to work together to get better prices for the products they need.

What is a GPO?

A group purchasing organization (GPO) is a collective of like-minded businesses that come together to leverage their combined purchasing power. This collective approach allows these businesses to negotiate from suppliers better prices, terms, and conditions than they would be able to individually.

In the healthcare sector, GPOs are primarily composed of hospitals, clinics, and doctor's offices. They band together to purchase necessary supplies, from medical equipment and pharmaceuticals to office supplies and services. By doing so, they save not only on costs but also streamline their procurement processes, allowing them to focus more on their primary goal: providing quality healthcare.

How do GPOs work?

A group purchasing organization operates on the simple yet powerful principle of collective bargaining. When businesses unite and pool their purchasing power, they become a significant customer for suppliers, thereby gaining the ability to negotiate lower prices and better terms. Here's the breakdown of how it works:

Membership - A healthcare provider (Ex: a hospital or clinic) joins a GPO. There might be a membership fee, or sometimes the GPO operates on a cost-sharing model.
Catalog access - Once a member, the healthcare provider gets access to the GPO's catalog of products and services, which includes everything from medical supplies and pharmaceuticals to office essentials.
Ordering - Members place orders through the GPO, specifying their needs. The GPO then communicates these orders to the suppliers.
Delivery and billing - Suppliers deliver the orders directly to the members. However, billing is often handled through the GPO, simplifying the process for members.
Cost savings - The discounted prices negotiated by the GPO translate into substantial cost savings for the members. These savings can then be redirected to enhance patient care and services.

Remember, the strength of a GPO lies in its numbers—the more members it has, the greater its negotiating power. So, the next time you're looking to make a significant purchase for your healthcare facility, consider the potential benefits a GPO could bring.

Types of group purchasing organizations.

There are primarily two types of GPOs—horizontal and vertical—and they differ in their structure and the benefits they offer.

Horizontal GPOs - These are organizations where members are from the same industry or sector, such as healthcare. Within the healthcare industry, for example, a horizontal GPO might include a group of hospitals, clinics, or nursing homes. Members of horizontal GPOs usually purchase the same types of products and services, allowing for greater purchasing power and more significant cost savings.
Vertical GPOs - In contrast, vertical GPOs comprise members from various industries. While this might mean a more diverse product and service catalog, the cost savings may not be as substantial as in a horizontal GPO, given the varying needs and purchase volumes of different industry members.

However, be it horizontal or vertical, the core objective of a GPO remains the same—to leverage collective purchasing power to secure better prices, terms, and services for its members. Therefore, choosing the right type of GPO depends largely on your specific business needs and purchasing requirements.

Reasons to join a GPO.

Joining a group purchasing organization (GPO) can bring manifold benefits for your healthcare business.

Cost savings.

One of the most compelling reasons to join a GPO is the substantial cost savings it can provide. GPOs leverage the collective purchasing power of their members to negotiate better deals, discounts, and terms with suppliers. This negotiating power can secure lower prices than individual healthcare providers could obtain on their own.

These cost savings can be significant, especially for healthcare providers who need to make frequent and substantial purchases. According to research from the Healthcare Supply Chain Association (HSCA), a trade association for purchasing organizations, the strength-in-numbers effect of GPOs helps save the healthcare system about $55 billion a year.

Efficient procurement.

Another significant advantage of joining a GPO is the efficiency it brings to procurement processes. Healthcare providers, particularly those running on tight schedules, may not have the luxury of time to negotiate with multiple suppliers or sift through countless product catalogs. A GPO eliminates this hassle by providing a consolidated platform for accessing a wide variety of medical supplies, pharmaceuticals, and services from trusted suppliers.

This streamlined process frees up valuable time and resources, allowing healthcare providers to focus more on their primary mission—patient care. The standardization of products across various providers through GPOs can lead to better consistency in service delivery and patient outcomes. It's like having a dedicated procurement team to handle your purchasing needs, without the overhead costs associated with managing such a team internally.

In a field where efficiency can greatly impact life-saving services, this advantage of GPOs cannot be overstated.

Access to a broad range of products and services.

A GPO offers an extensive portfolio of products and services, adding another layer of benefit to its members. Healthcare providers need a vast array of supplies, from basic office equipment to specialized medical tools and pharmaceuticals. With a GPO, members gain access to diverse catalogs compiled from various trusted suppliers. This vast array simplifies the procurement process as healthcare providers can find most, if not all, of their supply needs met in one place.

Moreover, due to the extensive network of suppliers, GPOs often have the capacity to provide newer, innovative products in the healthcare field. This allows healthcare providers to stay up-to-date with the latest technology and industry standards, thereby enhancing their service quality and patient care. Hence, partnering with a GPO not only streamlines the procurement process, but also equips healthcare facilities with the tools necessary to provide top-tier care.

Leveraging collective bargaining power.

The advantage of collective bargaining power is one of the central benefits of a GPO. By aggregating the demands of numerous healthcare providers, a GPO can negotiate with suppliers on a scale that individual members cannot. This collective force means that suppliers are more likely to offer favorable terms and prices, due to the volume of business they receive from the GPO's membership.

This collaboration not only helps to reduce costs but also creates a dominant market presence that suppliers cannot afford to ignore. Consequently, the GPO members, even smaller healthcare providers, have a strong voice and influence in their dealings with suppliers. The power of collective bargaining garners the best deals, terms, and conditions for the members, ultimately leading to better financial control, and freeing up resources that can be used to enhance patient care and services.

On a broader scale, the collective bargaining power of GPOs can even influence industry trends and drive innovation, as suppliers strive to meet the demands of a critical mass of customers. Thus, GPOs not only facilitate cost savings, but also foster an environment that pushes for growth, innovation, and improved patient care in the healthcare industry.

Community and support.

Yet another considerable advantage of joining a GPO is the community and support it offers to its members. The healthcare industry can be complex and challenging, with constant advancements, regulatory changes, and the need for effective patient care practices. Being a part of a GPO community allows healthcare providers to navigate these challenges more effectively.

The GPO community is akin to an extensive network of peers facing similar operational and procurement challenges. This network can provide valuable insight, advice, and innovative solutions to common problems. Members can learn from each other's experiences, share best practices, and collaborate to overcome shared obstacles.

In addition, many GPOs offer educational resources, training, and assistance to their members, helping them stay updated on the latest industry advancements, regulatory changes, and procurement strategies. This supportive environment empowers healthcare providers to improve their operations, enhance patient care, and ultimately succeed in their mission.

The support does not stop at learning and collaboration. GPOs often advocate for their members, representing their interests in discussions with suppliers and helping to resolve any issues that arise. The backing of a strong and sizable organization can provide peace of mind, knowing there is a dedicated team ready to assist when needed. In sum, the community and support provided by GPOs can be just as valuable as the cost savings they deliver, contributing significantly to the success of healthcare providers.

In a nutshell, being part of a GPO can lead to substantial cost savings, greater efficiency, access to a wider range of products and services, and a supportive community of like-minded businesses.

Is a GPO right for my business?

So is a GPO right for your healthcare facility? Probably. There is an undeniable benefit from buying in bulk. Otherwise, why would any of us have Costco memberships? (Obviously not for the beautiful ambiance in those cavernous warehouses.)

How to find the right GPO for your healthcare facility.

Just know that not all GPOs operate on the same level. The experts from Healthcare Finance recommend that you re-evaluate your GPO relationship about once every five years. This practice allows you to confirm that the supply chain spend is still relevant and the GPO is connecting you with the right products. The most effective way to get a bead on your savings is with a “market basket.”

“In healthcare, a market basket measures the pure price change of inputs used by a provider in supplying healthcare services by using price data from the Bureau of Labor Statistics,” explains Healthcare Finance. “If the market basket tops 50% of an organization’s spend, it’s helpful to look through each item to see if the GPO is effectively covering those items under contract. If it isn’t, a healthcare organization may want to look at other GPOs that potentially offer better deals.”

Perhaps your analysis will reveal essential values that you’re not currently receiving from your GPO. Truth is, the best fit for your facility might not be a large GPO. Smaller facilities sometimes find that they get more bang for their buck by working with a channel partner, which is a smaller company that belongs to a nationwide GPO.

When a hospital matches up with the right GPO or channel partner, they will likely see 8% to 10% savings for their supply chain. The potential to save this much money certainly makes it imperative that your healthcare facility considers the GPO model and carefully reviews its options before signing up with any given organization.

On the flip side, some experts in the healthcare industry have concerns with the GPO model. Research shared by Modern Healthcare reveals that GPOs can contribute to:

Higher prices
Drug shortages
Stifled innovation in medicine

At the heart of these issues is the fact that GPOs generally receive kickbacks and incentives from manufacturers. Just as there’s no such thing as a free lunch, there’s no such thing as a free product placement in a GPO catalog. With manufacturers paying fees to the GPO, the costs of supplies can go up. Ultimately, hospitals could end footing that bill.

Also, the contracting practices used by GPO exclude some suppliers from participating. This practice can limit the supplies available and keep some excellent products from reaching hospitals. This situation is especially true if GPOs make a manufacturer the sole supplier, essentially shutting the door on innovation and quality from other companies.

Despite these concerns, the GPO model still has a lot to offer the healthcare industry. You’ll just need to exercise caution before signing on the dotted line and make sure you understand how the GPO operates and what their supply chain looks like.

Even after you’ve joined an organization, remember to reassess your membership every five years. This clear-eyed approach will prevent you from getting stuck in a relationship that mainly benefits the other party.

The bottom line.

Group purchasing organizations play a substantial role in the healthcare industry. They present a cost-effective, efficient, and community-driven approach to procurement, which can be a boon for healthcare providers striving to balance financial constraints with the need for high-quality patient care.

While there are concerns regarding pricing and stifled innovation, these can be mitigated by adopting a vigilant approach towards GPO participation. Regular re-evaluation of your GPO relationship ensures your organization continues to gain value from the partnership. Ultimately, the decision to join a GPO should be a strategic one, based on a comprehensive understanding of your organization's unique needs and the offerings of the GPO.

Thinking about solutions to manage your medical practice’s finances? Check out medical practice loan options and find the one that suits your needs best.

How to Start a Food Truck Business

November 15, 2023

Opening a food truck can be easier, faster, and cheaper than launching a brick-and-mortar restaurant. Food truck entrepreneurs are drawn to the industry because of its ease of entry and relatively low overhead. This complete guide will walk you through each step of the process—from nascent idea to knowing when it’s time to expand—and answer some of the most common questions about starting a food truck.

How to start a food truck.

Starting a food truck business indeed has its charm, with the freedom of the open road and the joy of crafting delicious food for your community. But there's more to it than just cooking up a storm and finding a parking spot—let's dive into the essential steps to successfully launching your own food truck venture.

How to start a food truck.

Conduct market research.

Choose a concept for your food truck.

Write a business plan for your food truck.

Secure financing.

Get your truck (or car).

Get food truck licenses and permits.

Purchase your supplies and equipment for your food truck.

Select a POS system.

Protect your business.

Find a place to park.

Forge strategic partnerships.

Market yourself.

1. Conduct market research.

If you want your food truck to be profitable (and we assume you do), market research is the best place to start. Market research will help you understand your customers, your competition, and the food truck business on the whole. Here are some things to research to start your food truck business right:

Existing food truck businesses and their concepts (in your market and outside of it)
Existing restaurant concepts (in your market and outside of it)
Government data
Population demographics
Local food truck associations
Culinary schools
Trade publications
Trade organizations
Spaces where food trucks can park and sell their products
Times when streets/parking lots are busy

2. Choose a concept for your food truck.

After you've conducted your market research, it's time to decide on a concept for your food truck. This is a critical stage in the planning process because it not only determines the type of food you'll serve, but also sets the tone for your entire brand. Your concept should be unique enough to differentiate you from the competition, yet appealing to your target demographic. In other words, you'll want to find your niche. Some questions you can ask yourself that can help you find your niche include:

Did you grow up with a specific cuisine tradition that you could introduce to your market? (If so, you’ll want to revert to market research to ensure the market is ready for it.)
Can you use your family or cultural cuisine traditions to put a fresh spin on something familiar?
Do people in your network know you as the person who makes a killer X food?
Are you passionate about a particular cuisine or have a unique recipe that you think will be a hit?
Do you know how to take something complicated and simplify it, so that it works in a food truck?
When you performed your market research, were there any “no brainer” holes in the market, where you thought, “How do we not have a ______ food truck?”
Do you have an idea for a food truck that could complement an established food truck in your market? If so, would that food truck owner be interested in collaborating and/or selling in the same location?
Do you have an exceptional, attention-grabbing way to market something that people already know? The Big Gay Ice Cream truck in New York is a standout example. Their marketing made the ice cream truck a sensation that eventually led to a brick-and-mortar store.
Have you checked social media to see what foods trend well in your area? More and more people are sharing their food on social media. Getting a sense of the pulse might give you an idea for what people get excited about in your area—or what they might be likely to share.
Following up on the previous question, do you have an idea for really cute food (that also tastes good) that people would want to photograph?

Remember that consistency is key. Everything—from your truck's design, menu offerings, to the way you interact with customers—should be aligned with your chosen concept. This helps to create a memorable brand that people will recognize and return to. For instance, if you've decided to run an Italian-themed food truck, your menu might feature pizza and pasta, your truck might be decorated with the colors of the Italian flag, and you might play Italian music to set the mood.

Choosing your food truck's concept is not just about the food. It's about creating an experience that resonates with your customers. So take your time with this step. Brainstorm ideas, seek feedback, and refine your concept until you're confident it's the right one. And always remember, as trends change, be ready to adapt and evolve your concept to meet your customers' shifting tastes.

3. Write a business plan for your food truck.

After you've nailed down your food truck concept, it's time to create a business plan. This document is an essential blueprint for your business that outlines your goals, strategies for achieving them, and the resources required. The business plan will not only help you stay organized and on track, but also be critical when seeking financing or investors. Here's what your food truck’s business plan should cover:

Executive summary - This is a brief overview of your business, summarizing your food truck concept, target market, and unique selling points.
Company description - Provide detailed information about your food truck, including the type of food you'll serve, your location, and your hours of operation.
Market analysis - This section should include the findings from your market research. Discuss your understanding of your target market, competition, and any gaps or opportunities you've identified.
Organizational structure - Detail the structure of your business. Are you a sole proprietor, or do you have partners? If hiring staff, what roles will they fill?
Services and products - Describe in detail what you'll be selling. Be sure to highlight any unique dishes or services you'll be providing.
Marketing and sales strategy - Outline the strategies you'll use to attract and retain customers. This could include social media marketing, partnerships with local businesses, attendance at community events, and more.
Financial projections - Provide a forecast of your anticipated revenue and expenses. This section should show that your business will be profitable and sustainable.

Remember, your business plan is not set in stone. It should be a living document that you revisit and revise as your business grows and evolves.

4. Secure financing.

When you’re just starting out, you might not yet qualify for a business term loan, but there are a variety of financing options to help you get your food truck up and running. Here are some of your best bets:

Equipment financing

You can use an equipment loan to help purchase the truck or car you’ll use for your food truck business and any commercial cooking equipment that you need. Even your point-of-sale (POS) system can be paid for with equipment financing. Because an equipment loan is secured by the equipment itself, the loan offers lower risk to lenders. In turn, it’s easier for borrowers to qualify.

Line of credit

A line of credit allows you to borrow against a predetermined sum of money. You can borrow as much as you want (up to the total amount), repay, and repeat as many times as you need. A line of credit can be a key asset for new food trucks, as they often have changing capital needs. This financing option keeps you protected from unexpected financial hurdles, so you can keep your business finances as flexible as the location of your food truck.

Business credit card

Napkins, plastic silverware, ingredients, cleaning supplies—running a food truck means making necessary purchases. With a business credit card, those purchases work in your favor. Many business credit cards allow you to earn rewards on business spending, and if you don’t yet qualify for other forms of financing, there are ways to leverage business credit cards to meet your capital needs.

ACH loan

Unlike other forms of funding, ACH loan decisions are based on your daily bank balances instead of your credit, making an ACH loan an option for borrowers with less-than-ideal credit. Often referred to as a “cash flow loan,” an ACH loan provides rapid funding when you need to increase working capital.

Bootstrapping

Most businesses rely on bootstrapping, the practice of relying on your own resources, to grow at some point or another. Depending on how much you have saved, you may be able to self-finance and get your food truck up and running through bootstrapping. Once your food truck starts cooking with gas (metaphorically or literally), find ways to maximize your profits while minimizing your costs. This strategy will give you a cushion that you can reinvest in the business.

Crowdfunding

Crowdfunding allows you to secure capital for your business from a large number of people. Crowdfunding also allows you to acquire funding without giving up equity or traditional repayment terms. Instead, supporters can earn different rewards depending on the price tier of their investment. Popular crowdfunding sites like Kickstarter and GoFundMe can bring your business to a larger audience, but with the growing number of projects on the platforms, it can be difficult to stand out. And remember, if you go the crowdfunding route, it’s imperative that you can follow through on the rewards as promised.

5. Get your truck (or car).

You can’t run a food truck without a truck, car, or vehicle/food trailer combo. You can purchase your food truck through several different avenues.

Your network - The first place to start is always within your network. If you can purchase a used truck or car from a friend or family member, you’re probably going to get the best deal, lowering the startup cost for your food truck.
Used car dealerships - At a used car dealership, you may be able to find used vans, cars, or trucks that can be paired with a food trailer.
Food truck manufacturers - You can avoid the need for any truck modifications or labor-intensive build-outs by purchasing from a food truck manufacturer. These companies specialize in food trucks and often build custom models. The flip side of getting exactly what you need when you need it is that this will be one of the more expensive routes.
Auctions - Sometimes, a food truck goes out of business. When it does, you have the opportunity to make someone else’s misfortune your well-priced gain. Look into the auctions in your area. You may be able to secure your food truck below market value. Be sure to decide what your maximum price is before you go in, so you can avoid getting swept up in the moment and inadvertently overpaying.
Kitchen food trailer sellers - If the car or truck you already own is powerful enough to tow a food trailer, you can consider purchasing one from a kitchen food trailer seller. This choice will give you the customization options of a food truck manufacturer and can sometimes come at a lower cost.

6. Get food truck licenses and permits.

Securing the proper licenses and permits is a critical step in starting your food truck business. While specific requirements will vary depending on your location, there are a few common licenses and permits that most food trucks will need:

Business license - This license is required for all businesses and can usually be obtained through your local city or county government office.
Employment Identification Number (EIN) - This is a unique number assigned by the IRS to identify your business for tax purposes. If you're planning on hiring employees, this number is crucial. You can apply for an EIN through the IRS website.
Food service license - In most jurisdictions, you'll need a food service license (or health department permit) to prepare and sell food. This often involves a health inspection of your food truck.
Employee health permit - Many jurisdictions require an employee health permit to ensure that your staff understand and follow proper food handling and sanitation practices. This typically involves training and certification for all your food truck employees.
Fire certificates - If you're cooking on your truck, you may need a fire certificate. This generally involves a fire department inspection to ensure your cooking equipment is safe.
Commercial driver's license - If your food truck is over a certain size, you (and any other drivers) may need a commercial driver's license. Check with your local Department of Motor Vehicles for specifics.
Mobile food facility permit - Depending on your location, you may require a mobile food facility (MFF) permit. This permit allows you to operate a food truck or cart in public spaces, following the local health department's guidelines. It often involves an inspection to ensure your mobile facility meets all food safety regulations.
Parking permits - Depending on where you plan to park and sell, you may need special parking permits. Check local regulations regarding parking on public and private property.

Before starting your food truck business, consult with your local government to ensure you understand all of the licensing and permit requirements. It's also a good idea to consult with a lawyer or business advisor, who can provide guidance based on your specific circumstances. Violating local regulations can result in hefty fines or even the closure of your business, so it's essential to get this step right.

7. Purchase your supplies and equipment for your food truck.

After getting your food truck and securing all necessary licenses and permits, the next step is to purchase your supplies and equipment. This phase is critical as the tools and resources you choose will directly impact your operations, quality of food, and the overall customer experience. Here are some things you'll need:

Cooking equipment - Depending on your menu, this could include grills, deep fryers, ovens, and stovetops. When selecting your kitchen equipment, consider both the amount of space available on your food truck and the volume of food you'll need to prepare during peak times.
Refrigeration - To keep your ingredients fresh, you'll need a refrigeration or cooling system. This could be under-counter fridges, freezers, or sandwich prep tables with refrigerated bases.
Small wares - These are your utensils, pans, pots, knives, and other tools needed for cooking. Ensure these are high-quality and durable, able to withstand heavy use.
Serving supplies - This includes napkins, utensils, plates, cups, and straws. You might want to consider eco-friendly options here as a way to reduce your environmental impact.
Cleaning supplies - Maintain cleanliness with items like brooms, mops, cleaning chemicals, and sanitizing solutions. Remember, a clean food truck is not only a legal requirement, but also more appealing to customers.

Remember, investing in the right equipment and supplies will have a significant impact on your food truck's success. Make sure to do your research, compare prices, and read reviews before making any major purchases.

8. Select a POS system.

Choosing the right point-of-sale (POS) system is a critical decision for your food truck business. The POS system you choose will help you not only process sales, but also manage inventory, track revenue, analyze sales data, and maintain customer relationships. Here are some factors to consider when choosing a POS system for your food truck.

Mobility - Given the on-the-go nature of a food truck, your POS system should be mobile-friendly. A system that functions on a tablet or smartphone can offer the flexibility and convenience that a traditional cash register cannot.
Speed - During peak hours, you'll want to serve your customers as quickly as possible. A POS system that processes transactions quickly can significantly increase your operation's efficiency.
Reliability - Your POS system should be reliable even in areas with weak or no internet connection. Look for a system with offline capabilities to ensure you can still process sales without a network connection.
Integration - If you plan on using other business software (Ex: accounting or email marketing tools) make sure your POS system can integrate with these applications for seamless data management.
Customer support - Technical issues can arise unexpectedly, and when they do, you'll want immediate support. A POS provider with round-the-clock customer service can be an invaluable resource in these situations.

Remember, investing in the right POS system can contribute significantly to the smooth operation of your food truck business, so consider your options carefully.

9. Protect your business.

Prepare for the unexpected by protecting your food truck business with the proper insurance. There are a few different insurance policies that every food truck should have.

Food truck insurance

General commercial liability insurance - Often referred to as business liability insurance, general commercial liability insurance protects your business from a variety of claims that can be made against the food truck. It covers instances like bodily harm and property damage.
Commercial property insurance - A food truck is an equipment-dependent business. Commercial property insurance protects what’s inside your food truck like stoves, food, and computer equipment in the occurrence of fire, theft, or natural disaster.
Workers’ compensation insurance - There’s a chance that one of your employees may be injured on the job, and you’ll want workers’ compensation insurance if they are. Workers comp covers medical costs and a portion of compensation if one of your employees suffers an injury or becomes ill at work.
Commercial auto insurance - Don’t forget to insure the truck. Commercial auto insurance protects you against vehicle- and collision-related claims, including damage to your vehicle, driver injury, injury to someone else, and damage to someone else’s property.

Food truck insurance costs

Basic food truck insurance, including each of the elements outlined above, starts around $2,000 per month. Costs go up for more comprehensive coverage.

10. Find a place to park.

All you need to do is drive around and find somewhere with an open spot in a well-trafficked area, right? We wish. Because a food truck is a commercial entity, parking is a bit more complicated than that, and food truck locations can be incredibly important to the success of a business.

Restrictions on where you can park a food truck.

Research any local government restrictions or ordinances before you roll up to your new spot. Some cities may require you to procure a specific permit to park your food truck, and there may be some streets or areas that are off-limits to food truck entrepreneurs.

The second, softer restriction is a social one. Before you swipe another food truck’s regular spot, assess the costs and benefits of doing so. Sure, that may be a hot spot where you’ll sell out of your desert tamales in an hour, but it may come with a heavy social cost. You don’t want to make enemies as the new truck on the block.

Solid food truck locations.

According to Restaurant Engine, these are some of the best food truck locations:

Street parking
Food truck parks
Business districts
Large office buildings
Farmers markets
Bars/nightclubs
Festivals
Events
Sporting venues
Gas stations
College campuses

11. Forge strategic partnerships.

Strategic partnerships can benefit every business—from the Instagram micro-influencer to the Fortune 500 company. Forging a strategic partnership with another food truck (or better yet a group of food trucks) can benefit all parties involved.

Strategic partnerships offer an opportunity to expose food trucks to each other’s loyal customer bases and provide a more robust culinary experience, which can draw more customers. If your food truck already has an existing fan base, then you have value to offer to your potential partners, but there are ways to form these beneficial partnerships for new food trucks, too.

Remember when we asked if there were any existing food trucks in your market that your cuisine could compliment? (It’s okay, you can scroll up if you want a refresher.) Now is the time to revisit that question. If there’s a hamburger food truck in your area, and you plan to specialize in milkshakes, parking together offers your customers the opportunity to have a decadent hamburger and milkshake lunch or dinner, merging the classic American diner experience with the modern convenience of two food trucks parked side by side.

12. Market yourself.

Now that you’re ready to rock ‘n’ roll, it’s time to focus on marketing your business. Every successful food truck relies on marketing. Social media is going to be your best friend. You can announce your upcoming locations, specials, partnerships, and any other exciting news on Twitter, Facebook, or Instagram. As you build your business, you may find that your customers tend to engage with your food truck on one of these platforms more than others, but as you start out, it’s advisable to use a combination of the three. How else are you going to figure out which one they use the most?

Prominently display your social media accounts and whatever hashtag you’ve chosen for your business (Side note: You should choose a hashtag so people can ‘gram their lovely food truck eats.) so that customers know how to find you and who to tag.

It’s pretty simple to list your business with Google and well worth doing. Follow the instructions for how to add your food truck to Google My Business, so your customers can find you via Google search—a likely first step many will take after hearing about a business. It also allows you to start collecting reviews, so you can build that word of mouth. Many regional publications, like Time Out, also have directories where businesses can apply to be listed, increasing their reach.

Don’t forget to let local news outlets know you’re coming to town. Drafting a press release for your new business can be pretty simple, and it allows you to generate buzz. Try connecting with local publications, influential bloggers, Instagram influencers, and industry publications.

Discuss possible co-marketing strategies with your strategic partners. Posting together, tagging each other, or even doing the occasional Instagram takeover can help you market to each other’s audiences.

Starting and running a successful food truck business is a complex but rewarding endeavor. It involves careful planning, strategic decision-making, and proactive marketing. From investing in the right equipment and supplies, choosing a reliable POS system, and ensuring adequate insurance coverage, to identifying the perfect parking spots and forging beneficial strategic partnerships, every step is crucial. Marketing yourself effectively, particularly through the use of social media platforms, is also key to your food truck business's success.

Despite the considerable startup costs, the potential for high gross annual returns makes the food-truck business a lucrative option for aspiring entrepreneurs. As your business grows, don't shy away from expansion opportunities that may come your way. Whether it's opening additional trucks or transitioning into a brick-and-mortar establishment, there are numerous ways to take your successful food truck venture to the next level.

Laundromat Startup Cost: Financing Your Business

November 14, 2023

For the right entrepreneur, laundromats can be an exciting business opportunity.

Sure, laundry might not be your passion, and if you run a laundromat, you should expect to work long hours in a very humid space. Laundromats might not be as glamorous or exciting as other business ventures, but the fact remains that many people use laundromats on a consistent, repeated basis—which means consistent, repeat revenue for the laundromat owner.

Laundromats, interestingly, are a recession-resistant business, especially in urban areas where people don’t have the space or money for bulky laundry machines in their living spaces. And everyone wants clean clothes.

Laundromats are also scalable—you can offer a few machines or many. You can hire staff or run the operation by yourself. These days, you can even do on-demand or delivery-only laundry through mobile apps, which wouldn’t require a storefront.Bottom line: Laundromats are a great field for small business owners—plus, fabric softener smells great.

How much does it cost to open a laundromat?

Laundromats have some specific startup costs due to the specialized nature of the equipment. This is a good thing—you can have a solid plan for your startup capital needs. You can calculate an accurate approximation of the amount of funds you need to pull from your personal savings, or you can submit a precise application for outside business funding.

Location

Laundromats are deeply impacted by their locations, perhaps more than many other businesses. Some areas will naturally have more potential customers—college towns, for example, or cities with lots of renters. Your first step toward laundromat success is choosing a fertile location.

Buy, build, or rent?

Once you have a location in mind, you have three choices: buy an existing laundromat, build your own, or find one to rent. Buying an existing location will be very expensive because you’re buying a ready-to-open business, but you will also have an existing customer base. Building a location might actually require less capital up front because you can apply for commercial mortgages and equipment financing. Depending on your location, you might be able to work out a rent agreement with an existing laundromat or landlord—renting would be the least cost intensive, but you would also have less ownership over the business.

Utilities

Your customers will expect your laundromat to be bright and safe, and they will want their washers to fill with really hot water. Utility costs, especially electricity and water, are critical for laundromat operators. Utilities usually cost a few thousand dollars a month—experts say you should expect to spend 20% to 24% of your gross receipts on utilities.

Equipment

To run a laundromat, you need the right equipment or you don’t really have any business at all. Your equipment costs will likely be the highest barrier to entry for starting a laundromat, but there are ways to pay for your equipment over time. Here is some of the equipment you will need to invest in:

Washer - Depending on the type of washer, expect to pay between $500 and $5,000, although some systems can cost as much as $20,000 per unit. More expensive washers generally require less energy and can hold more laundry. Commercial washers have a lifespan of about 10 to 14 years.
Dryer - Dryers usually come stacked two in a cabinet, which is called a “stacked dryer.” These stacked dryers cost around $5,000 each. Like washers, commercial dryers have a lifespan of roughly 10 to 15 years.
ATM or change machine - You can typically work out an arrangement to have an ATM company install an ATM in your business in exchange for the ATM fees. Change machines are fairly cheap—often $1,000 to $3,000 each. Nowadays, credit card systems are the most convenient for customers, but these systems can cost around $40,000 to $80,000.
Soap vending machines - Expect vending machines to cost from $500 to $1,500.
Seating - Common laundromat seating, which should last a very long time, costs about $700 to $1,400 depending on the number of chairs per unit.
Water heater - A water heating system, critical for a laundromat, will cost between $15,000 and $40,000, depending on the size.

Your equipment costs will likely be the highest barrier to entry for starting a laundromat, but there are ways to pay for your equipment over time.

As a small business owner, you have several options when it comes to equipment. You can buy it up front, which requires high amounts of startup capital but you own your equipment outright. You can lease equipment, which means you never own it unless you opt to buy it at the end of your lease agreement. However, depending on the agreement, you can usually get brand-new equipment under a new lease when an old lease ends.

Many laundromat owners opt to finance equipment, because these agreements don’t require huge down payments and you own the equipment once the financing is repaid. With equipment financing, you can obtain the washers, dryers, and change machines a laundromat requires without a huge initial investment. The equipment itself usually serves as collateral for the financing, and you can get approved in as little as 24 hours.

Business insurance

You will need insurance to operate a laundromat—generally, expect to pay around $46 per month for $1 million to $2 million in coverage.

Marketing and advertising

You want people to know they can come to you and wash their clothes—marketing is very important for laundromats. The Small Business Administration estimates that consumer-focused businesses spend an average of about 12% of total revenues on advertising.

Reasons to open a laundromat.

In today’s fast-paced world, time is a commodity that many people find in short supply. This creates an opportunity for businesses that provide convenient solutions to everyday tasks. A laundromat business might not be the first idea that pops into your head when you think of lucrative investments, but you may be surprised at the benefits it offers.

1. Laundromats are a necessity.

Clean clothes are a household essential. Even in a recession, laundromats will see consistent business—perhaps even an uptick, as households wait to repair their own laundry machines. At most, laundries might see customers waiting longer between trips, but it’s unlikely people will stop doing laundry altogether.

2. Laundry is consistent year-round.

Almost all businesses have to deal with seasonal cycles, but not laundromats. Unless you’re in a town with mostly seasonal residents (like a beach community), customers will be visiting your business at about the same frequency in winter, spring, summer, and fall.

3. Americans have less time to do laundry.

With increased commute times, multiple jobs, and longer hours, Americans don’t have a lot of free time to do laundry. That means they are more willing to pay extra for wash-and-fold services, which more and more laundromats are offering. Some households with their own laundry machines are even choosing to go to laundromats to save time on multiple loads: a row of industrial-sized washers can go through a family’s dirty clothes in one cycle, while a home machine would take hours of separate loads to complete the task.

4. Laundry can’t be ordered online.

Customers can’t order clean laundry from Amazon. When you open a laundromat, you have a relatively captive group of consumers in your area.

The only exception might be laundry pickup and delivery services—however, these services are usually attached to a local laundry business. You can add a delivery component to your laundromat. Online-only services like FlyCleaners are still limited to major cities.

5. Laundry is local.

There’s not a single national chain of laundromats in the U.S. There are some small regional ones, but most laundromat owners operate just one or two locations—so you won’t have to worry about losing customers to the McDonald’s of laundromats. While some neighborhoods have two or three laundromats competing for business, others are dependent on a sole option. With the right location, you could provide a lifeline to a large apartment complex.

6. Laundromats are profitable.

We wouldn’t be discussing laundromats as a small business idea if they weren’t lucrative. According to Entrepreneur, most laundromats gross between $30,000 and $1 million per year, with about 35% profit if managed well. This couple describes a case study of $150,000 in annual revenue, with almost $50,000 in profit.

7. Laundromats can be (mostly) passive income.

A self-serve laundromat requires little active involvement. Someone needs to open and close the business each day, clean up, and collect quarters—and that last task is negotiable if you choose a card-based payment system. Equipment needs to be maintained and repaired periodically. Some owners choose to hire staff for these tasks, reducing their personal workload even more (but adding management responsibilities for the owner).

8. Laundromats have multiple revenue streams under one roof.

Dingy, cramped laundromats are a thing of the past. In recent years, coin-operated laundromats have been renovated to feature well-lit, comfortable waiting areas and other amenities. Owners have realized that many customers are happy to pay for diversions like vending machine snacks and arcade games while they wait for their clothes to dry. With fixed location costs, adding these revenue streams won’t affect your overhead much.

However, the most popular amenity addition to a laundromat is wash-and-fold service. This service will change the nature of your business from a self-serve, passive operation to one that requires much more hands-on work and constant attention. But many owners have seen a worthwhile investment and increase in revenue by courting customers too busy to do their own laundry.

9. No experience is required.

Few laundromat owners have experience in the business before they buy their first location. Some general familiarity with small businesses is recommended.

10. You can work with your hands.

Handiness with machinery is also a plus. You can hire a repairman when needed, but many owners find they keep costs down by learning basic machine repair themselves.

11. You can use your people skills.

Laundry owners, especially those with wash-and-fold services, will be interacting with customers frequently. If you enjoy talking to people and learning their needs, this might be the perfect job for you. Soft skills for customer service can come from many industries, further lowering the barrier to entry for laundry workers.

12. High up-front costs limit competition

There’s no way around it: Buying and opening a laundromat requires a lot of money. The industrial equipment is expensive, and many newer laundromats have a large real estate footprint. The Entrepreneur article estimates that laundromats require between $200,000 and $500,000 in starting costs.

However, this barrier to entry is an advantage for those who can overcome it. The high upfront costs and relative security are what make laundromats so appealing to people who have saved a nest egg and are looking for an investment or second career.

How to get funding for your laundromat.

When starting your laundromat, you will need funding to get your business germinating before revenue starts flowing in. This is true for almost every business—startup cash is essential for businesses to expand and thrive beyond their infancy.

Consider startup loans, which can serve as an engine to drive your young laundromat forward. While some small business owners opt to tap personal savings to get a business off the ground, this can end in personal catastrophe if your business doesn’t turn enough profit for you to pay yourself back.

But don't worry if bank loans aren't your thing. There's also the option of Small Business Administration (SBA) loans. These are government-backed loans that can offer lower rates and longer repayment terms. SBA loans do require a more in-depth application process, but the favorable terms can be worth it.

Another avenue to explore is private investors or venture capitalists. If you can convince them of the potential profitability of your laundromat, they might be willing to invest in your business.

You could also consider crowdfunding or peer-to-peer lending platforms. These online platforms allow you to raise small amounts of money from a large number of people. Though this can take some time and effort, it is a great way to engage your future customers and turn them into investors in your business.

Remember, every business is unique, so what works for one might not work for another. It's all about finding the best fit for you and your laundromat.

The bottom line

Starting a laundromat business is indeed a venture that carries a high initial cost, but it's a solid, resilient business that serves an ever-present need: clean clothes. By carefully considering the location, utilities, equipment, insurance, and marketing expenses, you can create a feasible plan to finance your laundromat. Remember, the journey of becoming a laundromat owner might seem daunting, but with careful planning, a bit of time, and the right funding, you'll be on your way to owning a successful, recession-proof business.

8 Ways to Prepare Your Small Business for Cyber Monday

November 13, 2023

9 min read

The Monday after Thanksgiving has become big business, even for America’s small retailers. This isn’t just another Monday—it’s a day that could potentially transform your business, driving sales through the roof and putting your brand on the map. But to reap the rewards from Cyber Monday, preparation is key.

As customers come to expect the convenience of online shopping for this critical day, here are eight ways to ensure your small business can capitalize on this event.

1. Plan early.

Planning for Cyber Monday (and the holiday shopping season in general) is not a task that can be left to the last minute, especially for small businesses. The importance of early planning cannot be overstated.

Running out of stock during such a high-demand period could lead to disappointed customers and lost sales. But early planning allows you to anticipate demand and ensure you have enough stock to meet the needs of your customers for large shopping events like Black Friday, Small Business Saturday, and Cyber Monday. By analyzing your sales from previous years, you can predict what items will sell quickly and stock up on them.

Planning ahead gives you ample time to optimize your website and ensure it can handle the surge in traffic. You want your customers' online shopping experience to be seamless, and a slow or malfunctioning website could turn them away.Perhaps most importantly, early planning enables you to map out your marketing strategy. You'll have enough time to craft engaging emails, social media posts, and other promotional materials. You can also plan exclusive offers for your loyal customers, giving them a reason to choose you over your competitors.

2. Ensure your website is ready.

At a time when the majority of shoppers are quickly transitioning online, website optimization is a must for small businesses, especially on Cyber Monday. Imagine a potential customer finds your business amongst a sea of competitors and clicks on your website, but it takes forever to load or is difficult to navigate. Chances are high they will abandon your site and move on to a smoother, more user-friendly website. This is a missed opportunity that you can't afford, especially on Cyber Monday when the stakes are so high.

Website optimization ensures your site is quick, mobile-friendly, and easy to use, contributing to a seamless shopping experience. A fast-loading website reduces the chance of potential customers leaving out of frustration, while mobile optimization ensures you're not missing out on the large demographic of people who prefer shopping on their phones or tablets.

An optimized website is also more likely to rank higher on search engine results, making it more visible to potential customers and bringing in more traffic. It also enhances customer satisfaction, as a well-functioning, user-friendly website contributes to a positive shopping experience, increasing the likelihood of customers returning to your store even long after Cyber Monday.

So, investing time and resources in optimizing your website is not just a preparation for Cyber Monday, but a long-term strategy that will serve your small business well in the increasingly competitive e-commerce landscape.

3. Stock up on inventory.

If you've done your early planning right, you should have a good understanding of which products are likely to be popular. Stocking up on these products can help prevent the disappointment of sell-outs and lost sales. Remember, a customer who finds their desired product out of stock might not just abandon their cart, but also turn to your competitors, resulting in lost business not just for Cyber Monday, but potentially for the long term.

Having sufficient inventory enables you to keep up with the fast-paced nature of Cyber Monday. With deals flying off the virtual shelves, the ability to quickly fulfill and dispatch orders can significantly enhance customer satisfaction. It gives the impression of efficiency and reliability, factors that customers highly appreciate and often base their repeat patronage on.

Stocking up for Cyber Monday can also prepare you for the rest of the holiday shopping season. Any inventory that remains can be used towards fulfilling orders for the upcoming holiday rush. This way, your business remains well-prepared to meet customer demands throughout the busiest time of the year.

4. Make sure you can afford it.

Preparing for Cyber Monday often means investing in additional inventory, an optimized website, a bolstered team, and a comprehensive marketing strategy. These expenses can add up quickly, and businesses need to ensure they have the necessary capital to cover these costs.

Moreover, the aftermath of Cyber Monday can bring additional costs. There can be increased costs related to shipping, handling returns, and customer service. Also, if you've stocked up too heavily on certain products that didn't sell as expected, you might be left with excess inventory that ties up capital and storage space.

5. Be smart about the discounts you offer.

When it comes to Cyber Monday, the temptation to offer deep discounts can be enticing. After all, the prospect of attracting more customers and driving up sales volumes can seem too good to pass up. However, small businesses must approach discounting with a strategic mindset to ensure long-term sustainability.

Discounting, while effective in attracting customers, can eat into your profits if not handled wisely. Therefore, it's crucial to carefully calculate your costs, including the cost of goods, operational expenses, and your desired profit margin, before deciding on your discount rates. This helps maintain healthy profit margins while still offering deals that customers find attractive.

Indiscriminate discounting can lead to an unsustainable price-war with competitors. Instead of focusing solely on offering the lowest prices, consider ways to add value to your customers' shopping experience. This could be through superior customer service, exclusive products, or rewards for loyal customers.

Take into account also the post-Cyber Monday scenario. Offering steep discounts may lead to a significant sales drop once prices return to normal. Smart discounting involves planning for this potential sales slump and devising strategies to retain customers even when the discounts are over.

6. Fine-tune your marketing strategy.

As a small business, fine-tuning your marketing strategy for Cyber Monday isn't a luxury, it's a necessity. It's your golden ticket to cut through the noise, reach out to your target audience, and turn the tide in your favor. With a plethora of deals flooding every corner of the internet, your business needs to stand out, and a well-honed marketing strategy can help you do just that.

A savvy marketing strategy starts with raising awareness. By leveraging various channels like email marketing, social media, and your website, you can broadcast your Cyber Monday deals far and wide. It's about catching the eye of not only your existing clientele, but also potential customers who are on the hunt for great deals. Effective promotion is the first step towards securing a successful Cyber Monday.

And it doesn't end there. A fine-tuned marketing strategy allows you to create a unique space for your business amidst the competition. It’s about more than just shouting the loudest about your deals—it’s about communicating in a way that resonates with your audience. By crafting engaging campaigns that reflect your brand's values and personality, you can draw customers towards your business.

Plus, by providing exclusive deals for loyal customers or personalized recommendations, you can foster a sense of belonging and value among your customers. Remember, at the end of the day, it's not just about a single day of extraordinary sales, but about building long-lasting relationships with your customers.

7. Secure your online platforms.

Cyber threats have become increasingly sophisticated, and small businesses are often targeted because they may not have the robust security measures that larger companies do. A data breach can result in not only financial loss, but also damage to your reputation, which can be devastating for a small business.

Investing in secure online platforms doesn't have to be a daunting or expensive task. There are many affordable security tools and services available that are designed specifically for small businesses. These tools can help you protect your customers’ data and your business by scanning for vulnerabilities, providing secure payment gateways, and encrypting sensitive data. By securing your online platform, you're not just protecting your business, but also showing your customers that you take their security seriously, which can boost their confidence and trust in your business.

For this reason, securing your online platform should be an integral part of your Cyber Monday preparation. It's a small investment that can prevent significant losses and help ensure the success of your Cyber Monday sale.

8. Plan for post-Cyber Monday.

Planning for the aftermath of Cyber Monday is just as vital for small businesses as gearing up for the event itself. High sales volumes during this annual e-commerce extravaganza can bring a flood of returns, customer inquiries, and potential inventory management challenges. Having a well-thought-out post-Cyber Monday plan can help you efficiently navigate these issues, keeping your customers satisfied and your operations running smoothly.

Firstly, let's talk about returns. No business enjoys dealing with returned goods, but it's an inevitable part of the retail landscape, especially after major sale events like Cyber Monday. However, a clear, fair, and easy-to-understand return policy can greatly ease this process. Communicate this policy to your customers effectively, and ensure your team is well-equipped to handle any return-related inquiries.

Remember, a good return experience can turn a potentially negative situation into a positive one, increasing the chances of future patronage from the customer.

Brace yourself for a possible influx of customer inquiries. Whether it's about delivery times, product details, or return processes, having a responsive, efficient customer service team can make a world of difference. It may be worthwhile to consider extending your customer service hours or providing additional training to your staff in the lead up to Cyber Monday. Consider leveraging automated tools such as chatbots or FAQs on your website to address common queries. In the end, it’s about being there for your customers and providing them with timely, accurate responses to leave them feeling valued and respected.

Preparing for Cyber Monday is no small feat, but it’s one that can pay off immensely for small businesses. Things like strategic discounting, a well-thought-out marketing strategy, robust online security, and effective post-Cyber Monday planning are all critical elements in achieving a successful and profitable Cyber Monday.

Remember, the goal is not just to rake in sales on this one day, but also to cultivate lasting relationships with your customers. With the right level of preparation and strategy, your small business can fully harness the power of Cyber Monday and emerge victorious in this highly competitive e-commerce landscape. So gear up, plan carefully, and get ready to make the most of this amazing opportunity for your business.

Navigating Construction Invoice Factoring

November 13, 2023

Visit this page to learn more about other construction business loan options.

6 min read

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In the construction industry, managing cash flow can often feel like building a skyscraper on shifting sands. The nature of the work involves significant upfront costs, from materials and equipment to labor and permits, all to be paid long before a project reaches completion and payment is received.

Cash flow challenges can put construction companies in a precarious position when expenses exceed income. This is where construction invoice factoring comes into play. It is a financial solution that is designed to bridge the gap between outgoing costs and incoming payments. In this article, we will delve into this unique financial tool that is specifically designed to keep your construction business on solid ground.

What is construction invoice factoring?

Construction factoring is a type of financing that allows construction companies to use their customers’ pending purchases (i.e. accounts receivables) as collateral for getting cash upfront. A small business might choose this type of financing for the common following reasons:

To buy machinery, materials, or other services needed to fulfill a construction project
To get working capital for immediate costs like maintenance, emergencies, or even payroll.
To access capital when banks and other financial institutions will not lend to you.

How construction invoice factoring works.

Here's a simple step-by-step journey through the construction invoice factoring process:

Start a job - You commence work on a construction project, carrying out tasks as per your client's requirements.
Invoice your customer - Upon completion of a phase or the entire project, you send an invoice to your customer detailing the work done and the amount due.
Sell the invoice - Instead of waiting for the customer to pay, you sell the invoice to a factoring company.
Get advance payment - The factoring company then provides you with an immediate advance, usually around 80% to 90% of the invoice value.
Factoring company collects payment - The factoring company takes on the responsibility of collecting the payment from your customer.
Receive remainder minus fees - Once the customer pays the invoice, the factoring company will pay you the remaining balance, minus their fees.

This process allows your construction business to maintain a steady cash flow, even when customers take their time to pay. With construction invoice factoring, you can keep your projects on track and your business thriving.

Example

Let's take the example of Buildit Construction, a small construction firm. They've just completed a major phase of a residential complex project and have invoiced the client, a property development company, for $100,000. However, the terms of payment are 90 days, and Buildit Construction needs the money now to fund their next project phase.

Using construction invoice factoring, Buildit Constructions sells the invoice to Fast Funds factoring company. Fast Funds provides them with an immediate advance of 85% of the invoice value, which is $85,000. Fast Funds then takes over the task of collecting the payment from the property development company. Once the payment is received, Fast Funds will send the remaining $15,000 to Buildit Constructions, subtracting their factoring fees. This way, Buildit Constructions can continue their operations without having to wait for the property development company's payment, streamlining their cash flow and keeping the project moving forward.

Benefits of construction invoice factoring.

Let's break down the advantages of using construction factoring:

Improved cash flow - By selling your invoices, you receive immediate funds to cover expenses and invest in growth opportunities for your business.
No debt incurred - Unlike traditional loans, invoice factoring does not create any debt on your balance sheet.
Quick access to capital - Traditional financing can take weeks or even months, but factoring allows you to receive funding within 24 hours.
No impact on credit score - Since factoring is not a loan, it doesn't affect your credit score.
Flexibility - Factoring companies are often more willing to work with growing construction businesses and offer flexible terms to meet their unique needs.

Requirements for construction invoice factoring.

To qualify for construction invoice factoring, there are a few key requirements your business must meet.

Legitimate invoices - First and foremost, you need legitimate invoices for completed work. The invoices should be free of any liens or encumbrances and tied to creditworthy commercial or government customers.
Good standing - Your business should be in good standing, with no legal issues or tax problems that could impact the factoring agreement.
Customer's creditworthiness - Unlike traditional lending, factoring companies focus more on your customer's creditworthiness rather than yours. If your customers have a solid payment history, you're more likely to get approved for factoring.
No outstanding loans or liens on invoices - If your business has any outstanding loans or liens on your receivables, it may complicate the factoring process. It's essential to disclose this information up front.
Professionalism - You should have a history of conducting your business professionally, as this reflects positively on your relationship with your customers and the factoring company.

Remember, requirements can vary from one factoring company to another. It's wise to discuss your specific situation with potential factoring companies to understand if this solution fits your business needs.

Construction factoring rates and fees.

Since invoice factoring is not a loan, you will be charged a fee instead of an interest rate. The factoring fee is typically a percentage of the total value of the invoices ranging from 1% to 8%. Some factoring companies may charge a smaller fee for the first 30 days and then slowly increase the fee if the invoice remains unpaid.

Some additional fees you may be charged include:

Lockbox fee: This fee is charged by the factoring company for receiving and processing payments from your customers.

Monthly access fee: Some factoring companies may charge a monthly access fee for using their services. This fee can vary depending on the company and the services they offer.

It's important to carefully review all potential fees and rates before choosing a factoring company. Each company may have different terms and conditions.

The difference between invoice factoring and invoice financing.

Often, the terms 'invoice factoring' and 'invoice financing' are used interchangeably, but it's worth noting that there are subtle differences between the two.

The main difference boils down to who manages the customer payment. In invoice factoring, the factoring company takes on the collection responsibility, while in invoice financing, you're still in charge of your accounts receivable. Both offer similar benefits in terms of improving your cash flow, but the best choice for your construction business will depend on factors like your business size, customer payment history, and your capacity to handle collections.

Before deciding on construction invoice factoring, carefully weigh the benefits against any potential drawbacks and consider consulting with a financial advisor to determine the best course of action for your business. By making informed decisions, you can keep your cash flow steady and ensure that your construction projects continue to soar. Keep building, both literally and financially.

How to Start a General Contractor Business

November 13, 2023

Starting a general contractor business can be a rewarding venture, providing the opportunity to showcase your skills while helping others achieve their construction and renovation dreams. Whether you're a seasoned professional in the construction arena or a committed entrepreneur interested in the industry, this guide is for you.

We'll walk you through the necessary steps, ensuring you understand the ins and outs of launching your own general contractor business. Let's embark on this exciting journey together.

1. Develop your business plan.

Just like any worthy endeavor, your general contractor business needs a plan. In its simplest form, this document will outline what your business is going to do and how you’re going to do it.

So what goes in your plan? The best way to think of it is as a collection of answers. In the process of answering important questions about your future business, you’ll develop the framework that will guide your business into the future.

Possible questions to prime the pump include:

What will your main objectives be?
What are your key strategies?
What will your mission statement be?
How will you market your business?
How will you stand out from the competition?
What are your projections for your business?

To thoroughly answer these questions, you’ll need to conduct an industry analysis and additional research. These actions are time-intensive but will provide essential data and spur ideas.

2. Decide on the structure of your business.

When you’re ready for your business to really take shape, it’s time to figure out the name and structure. First, research potential names that would resonate with customers and help you stand out from the competition. Then peruse construction industry directories to make sure the name isn’t already in use. You’ll also want to make sure the domain name is available. Finally, go to the U.S. Patent and Trademark Office’s website to make sure your preferred name is yours for the taking.

At this point, you need to choose a legal structure for your business. There’s no silver bullet here, as each structure has pros and cons. Due to the importance of this element of your business setup, this is an excellent topic to discuss with your mentor.

So what are your options when it comes to business structures? Here’s a breakdown of the five most popular:

Sole proprietorships - This route is the easiest. A sole proprietorship is designed for just one owner, meaning every aspect is streamlined. As the single owner, you assume complete responsibility for the business. The profits flow straight to you, but so will any losses. Sole proprietorships do not provide liability protection, meaning your personal assets could be at risk.
Corporations - If there will be multiple owners of your business and liability protection is a priority, you should consider a corporation. With this structure, your business is considered its own legal entity. In the unfortunate case of severe debts and losses, your assets would be shielded. Just know that it’s a fairly complex process to set up corporations, and the costs are higher than with a sole proprietorship.
General partnerships - This structure is ideal if there will be more than one owner and everyone wants an equal stake in the company. Each partner will have a voice when it comes to decisions in a general partnership, but the downside is they all share liability for the finances as well.
Limited partnerships - If there is a hierarchy among your potential partners, you should consider a limited partnership. The unique structure allows some individuals to be dubbed full partners, while others can assume more of an investor relationship with the business. Full partners will shoulder the liability, while the secondary partners are protected.
S corporations - This hybrid structure combines the liability protection of corporations with some of the financial convenience of sole proprietorships. But that’s not to say that S corporations are easy to create and run. You’ll have to meet certain requirements, such as conducting meetings for shareholders, recording the minutes, and soliciting shareholder votes on decisions.
Limited liability companies (LLCs) - This common structure is chosen by small business owners due to its user-friendly benefits. For example, an LLC provides liability protection and has lenient tax rules, while also allowing for as many shareholders as you wish.

3. Register for an EIN and create a bank account.

You could have the best business plan in America, but you still probably wouldn’t be able to do business without an Employee Identification Number (EIN). Go to the application page on IRS.gov and you’ll be pleasantly surprised by how easy it is to register your business.

Next, you’ll need to take care of a bank account. The most convenient route is to open a business account at the bank where you already handle your personal finances. Because the bank has your personal data and has established a track record with you, the application process will be much faster.

4. Obtain necessary licenses and permits.

As a general contractor, you're required to have specific licenses and permits to legally operate your business. The requirements vary depending on your state, so it's crucial to research what's needed in your particular location. Typically, a general contractor license, business license, and building permits are a must-have.

To get your general contractor license, you'll likely need to pass an examination that tests your knowledge of the construction industry and business practices. This license permits you to legally perform and oversee construction projects. Check out the National Association of State Contractors Licensing Agencies for more detailed information on each state's requirements.

A business license—obtained through your local city or county government—authorizes you to operate a business within their jurisdiction. You may also need to apply for specific permits depending on the nature of the projects you undertake, like electrical, plumbing, or demolition permits.

Remember, it’s not enough to just have these licenses and permits—you must also ensure they are always up to date. Operating without the necessary licenses or permits (or with expired ones) can lead to hefty fines and potentially damage your business reputation. Keeping on top of these administrative tasks can help ensure the long-term success of your general contractor business.

5. Secure the right insurance.

Just as important as obtaining the necessary licenses and permits for your general contractor business is securing the appropriate insurance. When operating a general contractor business, several types of insurance are considered industry standards. These include:

General liability insurance - This type of insurance provides coverage for any accidents or injuries that occur on the worksite. It typically covers medical expenses, legal fees, and any damages awarded in a lawsuit.
Workers compensation insurance: - If your business has employees, most states require you to carry workers' compensation insurance. This coverage provides wage replacement and medical benefits to employees who are injured on the job.
Commercial auto insurance - If your business owns vehicles, commercial auto insurance is a must. This insurance protects your company from the financial fallout of an auto accident, including coverages for property damage, medical expenses, and liabilities.
Builders' risk insurance - This type of insurance covers a construction project from various risks such as fire, theft, or natural disasters while the project is underway.
Professional liability insurance - Also known as errors and omissions (E&O) insurance, this covers you if a client claims that errors or negligence in your work caused them financial harm.

Remember, the specific insurance requirements may vary depending on the location and nature of your projects. It's crucial to work with an insurance expert or broker to identify the right coverage for your business needs. Operating without the right insurance can expose your business to unnecessary risks and potential financial hardship.

6. Understand the importance of contractor bonds.

In addition to securing the right insurance coverage, another crucial aspect to consider when starting a general contractor business is obtaining contractor bonds. Contractor bonds, often required by law, provide a financial guarantee that you will fulfill your contractual obligations to your clients.

There are different types of contractor bonds, but the most common ones are:

Bid bonds - These assure the client that you will honor the terms outlined in your bid if it is accepted.
Performance bonds - These provide a guarantee that you will complete the project as per the terms of the contract. In case of default, the client is compensated up to the full amount of the bond.
Payment bonds - These ensure that all subcontractors, laborers, and material suppliers involved in the project will be paid.

Obtaining a contractor bond involves applying through a surety company or a bond broker. They will evaluate your financial health, industry experience, and creditworthiness before issuing a bond. Keep in mind that you may be required to pay a premium, usually a percentage of the bond's total amount.

Remember, having contractor bonds not only fulfills legal requirements but also enhances your credibility with clients by demonstrating your commitment to completing projects as promised. It's always a good business practice to stay bonded to protect your business, your clients, and your reputation in the industry.

7. Finance your business.

One of the most important elements of your business plan is deciding how much money you will need and when you’ll need to acquire it. There are diverse expenses related to getting a construction business up and running, including materials, equipment, vehicles, trailers, tools, insurance, licenses, office furniture, computers, and software.

You’ll also need to consider less obvious expenses, such as advertising, maintenance, payroll, and professional fees. Many entrepreneurs struggle with their budgeting because they don’t account for all of these ancillary aspects.

When you know exactly how much money you need, you’ll be in a prime position to seek any necessary financing. Here are five common types of financing for general contractors:

Term loan - A term loan is a lump sum of capital you pay back over a fixed period. The payments are made monthly, and the interest rate can be either fixed or variable.
Invoice factoring - As a general contractor, you may find that some clients don't pay their invoices promptly, which can create cash flow problems. Invoice factoring is a financial solution where a third-party company, called a factor, buys your unpaid invoices for a fee. You get the cash immediately, allowing you to finance ongoing operations, while the factor collects the invoice payment when due. This option can be highly beneficial if your construction business operates on a B2B model.
Equipment financing - This type of financing involves borrowing money to purchase equipment and other assets. The asset serves as collateral for the loan, often leading to lower interest rates.
Business credit card - Most entrepreneurs get business credit cards so they can begin separating their business purchases from their personal expenses. They function just like any other credit card.
Line of credit - This financing product is similar to a credit card because it gives you ongoing access to a set amount of money. The benefit here is that you can spend cash only when you need it and keep it as a safety net when you don’t, rather than always needing to pay interest on a lump sum.

Regardless of which route you take for your financing needs, it’s advisable that you get an accountant to help manage your money from here on out. Not only will an accountant keep your finances accurate and secure, but they can also help you spot potential problems and find remedies before it’s too late.

8. Hire subcontractors.

Hiring subcontractors is a crucial part of running a successful general contractor business. As a general contractor, you'll often rely on subcontractors to complete specific parts of a project that require specialized skills. Here's how to go about it:

Identify your needs - First, determine which tasks or projects require subcontracting. This could be anything from electrical work and plumbing to roofing and flooring. Understand the scope of the project and the skills needed to complete it successfully.
Search for subcontractors - Once you've identified your needs, start looking for suitable subcontractors. You can leverage online construction networks, trade associations, or local business directories. Word-of-mouth referrals from other contractors, suppliers, or previous clients can also be helpful.
Evaluate potential subcontractors - After identifying potential subcontractors, assess their skills, experience, reliability, and reputation. Check their references, previous work, and online reviews. Also, ensure they hold the necessary licenses, insurances, and bonds.
Negotiate terms - Once you've chosen a subcontractor, negotiate the terms of the contract, including the scope of work, deadlines, payment terms, and responsibilities of each party. Be sure to put everything in writing to avoid future disputes.
Manage and communicate - Maintain regular communication with your subcontractors once the work begins. Clear, regular communication helps to ensure everyone is on the same page regarding project expectations and deadlines.

Remember, hiring the right subcontractors can greatly affect the quality of your work and your reputation as a general contractor. Take your time to select subcontractors who are experienced, reliable, and professional. After all, the success of your general contractor business depends heavily on the team you build.

9. Seek out a trusted mentor.

Every entrepreneur can benefit from the guidance of a mentor, but it’s especially helpful for those in the construction industry. Whether this guru is actively working or has retired, it’ll be essential to draw from the experiences and problem-solving abilities of someone who has already built a business from the ground up.

If you have a difficult time finding a potential mentor, don’t be afraid to venture outside of your immediate sphere of contacts. Start by checking out the free resources available from your local SCORE chapter or SBA Small Business Development Center.

It won’t matter if your mentor is a close friend or a stranger. The important thing is that you’ll have a support system and sounding board in place. The construction industry can be a rocky road, so stay close to those who know how to best navigate it.

You can also make powerful relationships by joining an industry association. Two great choices are Associated General Contractors and Associated Builders and Contractors. Use these networking opportunities to get answers to your questions big and small.

10. Deploy effective marketing strategies.

In today's competitive business environment, marketing your general contractor business effectively is more important than ever. A well-structured marketing strategy can help increase your visibility, attract new clients, and ultimately grow your business. Here's how you can go about it:

Establish a strong online presence - In the digital age, an online presence is vital. Start by creating a professional website showcasing your services, past projects, client testimonials, and contact information. Maintain an active presence on relevant social media platforms where you can engage with potential clients and share updates about your work.
SEO and local listings - Optimize your website for search engines (SEO) to make it easier for potential clients to find you. List your business on local directories and Google My Business, ensuring your contact information is accurate and consistent across all platforms.
Network - Attend industry events, join local business networks, and build relationships with other professionals in your field. Networking can often lead to referrals and new business opportunities.

Remember, marketing is an ongoing process, not a one-time event. Keep testing different strategies, track your results, and continuously adjust your marketing plan based on what’s working for your general contractor business. The key to effective marketing is consistent, authentic engagement with your audience.

11. Learn how to bid on construction jobs.

Estimating and bidding on construction jobs are essential skills for running a successful general contracting business. These processes allow you to competitively price your services, win contracts, and ensure your projects are profitable. Here's a brief walkthrough:

Understand the project scope - Before you can create an accurate estimate, you need to fully comprehend the project's requirements. This involves understanding the client's needs, reviewing blueprints, and identifying needed materials, labor, and equipment.
Calculate costs - Next, calculate your direct costs, such as labor, materials, and equipment rentals. Don't forget to also factor in indirect costs like overhead, permits, and insurance.
Add your profit margin - Once you've calculated the total costs, add in your desired profit margin. This will be the basis for your bid.
Prepare a bid - Your bid should be detailed, professional, and accurate. Be sure to include a breakdown of costs and a timeline for the project.
Submit your bid - Once you're happy with your bid, submit it to the client. Be prepared to negotiate and answer any questions the client may have about your bid.

Bidding on projects can be complex, but with practice and the right approach, you can create effective bids that win you more business. For a deeper dive into this process, check out this Beginner's Guide to Bidding on Construction Jobs. It provides a comprehensive look at the bidding process, from understanding the project to submitting your bid.

12. Stay the course, but stay limber.

There’s no doubt that your business plan will be crucial in the coming months and years. But it should remain a working document—never treat it like it’s written in concrete. The future holds many exciting opportunities for your business, as well as unexpected difficulties. Your ability to adapt and refine will be essential to your success.

By working hard and leveraging your network, you can help your general contractor business thrive. Entrepreneurship takes courage, so even on the toughest of days, hold your head high. You’re not just building a business. You’re building a legacy.

A Veteran’s Guide + Resources to Start a Small Business

October 12, 2023

From finance and insurance to mining to real estate, veterans are making an impact in every industry you can imagine. Veterans now own more than 2.5 million businesses in the U.S., and that number doesn’t appear to be slowing down.

“You go through so much in the military, but really what the military is teaching you is how to be resilient,” said Dawn Halfaker, founder and CEO of Halfaker and Associates. “You plan a mission, and then you execute, but nothing ever goes according to plan. Your job is to continue to lead in not-ideal circumstances.”

That sounds like entrepreneurship in a nutshell.

If you’re a veteran looking to build a business from the ground up, then hold your head high—the odds are in your favor. And fortunately for you, there are concrete fiscal benefits to running a veteran-owned small business, and we want to help you take advantage of all of them. This guide will walk you through everything you need to know to make your business-owning dream a profitable reality. First, let’s make a plan.

Steps to starting a veteran-owned business.

Come up with your business idea
Create a small business plan
Register your business
Find financing

1. Come up with your business idea.

The first step towards starting a veteran-owned business is to come up with a compelling business idea. A good starting point is to reflect on your personal interests and passion. What are you deeply passionate about? Where do your strengths lie? A business built around your passion and skills is likely to keep you motivated during tough times.

Additionally, consider the skills and experience you acquired during your time in the military. Your unique training and perspective can provide a solid foundation for a security consultancy firm or a logistics company, for example.

Also, consider the needs of your local community. Is there a service or product the community lacks? Providing a solution to a local problem can give rise to a successful business.

Finally, don't shy away from seeking advice from other veteran entrepreneurs and business professionals. Their experience and insights can prove invaluable in helping you refine your business idea.

2. Create a small business plan.

Before you start building your business, you need a plan. Your plan will be the roadmap to your success. Where are you currently? Where do you want to be one year, five years, and 10 years from now? What do you need to do to get there? Your business plan will help you answer these critical questions, and these answers will guide your business like Siri guides your car—except better.

Don’t have a business plan yet? No problem. Take an hour or a day (or a week) to walk through our “Step-by-Step Guide to Writing a Business Plan.” This guide will help you decide which industry you should target and what kind of business you should build. Where is their demand? What startup would be best served by your skillset?

Benjamin Franklin said, “If you fail to plan, you are planning to fail!” You’d probably nod your head at that. Then, you might tack on a well-known quote from the film Valkyrie: “Remember, this is a military operation. Nothing ever goes according to plan.” Then, we would take our turn to nod ours.

Entrepreneurship is full of surprises and unknown variables. You can’t plan for everything, and even when you do, everything could still go wrong. That’s where your resilient attribute really comes in handy. When faced with challenges, others would likely throw in the towel, but you’ve been trained to grit your teeth and fight through the hard times.

If you’re struggling to come up with a viable business plan, don’t stress too much. There are plenty of veteran-specific resources we’ll discuss later that will help you fill in all the critical details. Free education, training, mentorship, online courses—there are tools available for whatever you need to find the best path forward.

Now, with your plan in hand, it’s time to start building your business. Where do we begin? You’ll need to register your business, so let’s start there.

3. Register your business.

The process of registering your business involves several steps, each crucial to ensuring that your business operates legally and efficiently. Here's a simplified guide to get you on the right track:

Step 1: Decide on a business structure

Before registering your business, decide on the type of business structure that best suits your needs. The structure you choose will impact your tax obligations and legal liabilities. The most common types include sole proprietorship, partnership, limited liability company (LLC), and corporation.

Step 2: Choose a business name

Once your business structure is defined, the next step is selecting a name. Make sure to conduct a thorough search to ensure the name you've chosen isn't already in use or trademarked.

Step 3: Register your business name

After settling on a unique business name, you must register it. The process varies depending on your state and the structure of your business. For example, if you're operating as an LLC or corporation, the business name will typically be registered when you file your articles of incorporation or organization.

Step 4: Get a federal tax ID

Also known as an employer identification number (EIN), a Federal Tax ID is necessary for tax purposes and is also often required to open a business bank account. You can apply for an EIN through the IRS website.

Step 5: Apply for state and local tax IDs

Depending on your state and the nature of your business, you may need to apply for state and local tax IDs. Check the requirements in your specific area.

Step 6: Obtain necessary permits and licenses

Depending on your type of business and your location, you may need specific permits or licenses to operate. Check with your local and state government to see what's required.

Step 7: Register with the VA

As a veteran-owned business, register with the Department of Veterans Affairs (VA) to potentially qualify for government contracts.

Remember, each state has different rules and regulations for business registration. It's recommended that you seek legal advice when registering your business to ensure all legal requirements are met.

4. Find financing.

You can find a variety of financing options for your veteran-owned business. You could secure veteran-specific programs and grants or debt financing.

Veteran financing programs

In addition to generic business loans, you can find several financing options that are veteran-specific.

1. Veterans Business Fund (VBF)

The VBF is a nonprofit organization formed to help a growing number of unemployed veterans get access to supplemental capital to qualify for small business loans. So if you’re struggling to qualify for a loan because you don’t have the necessary base capital, apply for help from the VBF.

2. Military Reservist Economic Injury Disaster Loan program (MREIDL)

This interesting financing option is run by the U.S. Small Business Administration (SBA). MREIDL provides funds to small businesses that have been impacted by a leader or critical employee being called up to active duty with the reserves. Veterans can apply for this loan within one year of returning from active duty, but some of the terms last up to 30 years.

3. Hivers and Strivers

If you’re a veteran who graduated from a U.S. military academy, you may qualify for financing from Hivers and Strivers. Hivers and Strivers is an angel investment group that focuses on early-stage startups. Most of the group’s founders and leaders have served in the military, so they’re all about supporting young veteran entrepreneurs.

4.SBA Express Loan Program

Veterans can have the upfront guarantee fee waived if they qualify for an SBA Express loan. Maximum funding through the SBA Express Loan Program is capped at $350,000, but that’s really the only downside to this financing option.

5. Lendio

Lendio’s marketplace can help you find the right veteran business loan, even if you’ve already been turned down by a bank. With a 15-minute application, we’ll connect you with a loan from our network of more than 75 lenders.

This list is by no means definitive, but it’s a great place to start looking for veteran-specific financing options.

Veteran Grants

Grants are considered by many to be the holy grail of business financing. Unlike loans, which a borrower must pay back with interest, grants are awarded for a specific purpose, with no repayment requirements. However, VA grants tend to be more difficult to secure than loans. Each grant has its own specific requirements, so do your research before applying to get the best shot of being approved.

Here are a few of the VA grant options available:

Honor Courage Commitment’s Veteran Entrepreneur Training Program

The Veteran Entrepreneur Training (VET) program grant gives you a chance to attend training sessions at the HCC Veteran Business Center in Dallas, Texas. It also offers the opportunity to receive grants for specific phases of your business, including building your idea and getting legal help, as well as the building phase, where you’ll receive aid for advertising. They also provide training about other forms of business financing.

Second Service Foundation's Military Entrepreneur Challenge

If you are an ambitious veteran looking to make your mark in the business world, the Second Service Foundation's Military Entrepreneur Challenge could be an excellent opportunity for you. The Military Entrepreneur Challenge is a grant competition wherein veterans submit their business plans for scrutiny by a panel of experts. Winners of this competition are awarded grants that they can use to kick-start or expand their businesses. This challenge is not just about the grant money; it's also an avenue to receive valuable feedback about your business plan and a chance to connect with a network of successful entrepreneurs and investors

GrantWatch

Title aside, this isn’t an actual grant. However, it does showcase resources and grants available to veterans, including business grants. It’s worth keeping an eye on this site because the offerings change frequently and have different deadlines.

Veteran-owned small business resources.

Money is only one part (although a large one) of building a business. You also need the know-how to use that money wisely. Veterans can gain this know-how and get a leg up on the competition with access to several veteran-specific small business resources. There are a lot of resources available, but here are a few of our favorites:

Patriot Boot Camp

Patriot Boot Camp (PBC) is an accelerator program (presented by Techstars) that helps veterans and their spouses create tech companies. PBC’s flagship program is a free three-day event that includes education training and one-on-one mentorship. If you’re thinking of starting a tech startup, trust PBC to give you the tools and talents you need to kick things off with a bang.

Veteran Business Outreach Centers

The SBA provides veteran-specific business training all over the U.S. right in the heart of their communities. Check the SBA’s local assistance page to find a center near you. These Veterans Business Outreach Centers offer training, counseling, and mentorship to help you start and grow your business. Plus, the professionals helping you are from your community—so they’ll be best positioned to answer your questions and guide you in the right direction.

Boots to Business

Boots to Business (B2B) is another SBA-offered program that provides business and entrepreneurship training to veterans. Registrants start with a two-day, in-person program to learn the fundamentals. Afterward, participants can advance their studies with a free, eight-week online course that walks students through creating their business plan and other critical elements of a startup.

Veteran Entrepreneur Portal

The VA’s Veteran Entrepreneur Portal (VEP) is a go-to resource for all things startup. Whether you’re looking for best practices, financing, government contracting opportunities, or training, the VEP has it all and much more. All veteran business owners should spend some time scrolling through the incredible amount of free information and resources on this platform.

Warrior Rising - VetToCEO Business Accelerator

Warrior Rising is a non-profit organization committed to empowering U.S. military veterans and their immediate family members by providing them with the resources to start and grow their own businesses.

The organization's flagship offering is the VetToCEO Business Accelerator program. It’s designed to help veterans transition from service to entrepreneurship. The program is a seven-week online course that takes participants through a step-by-step process of launching their own businesses. Each week, participants are required to complete assigned tasks related to their business. These assignments are reviewed and critiqued by established veteran entrepreneurs, providing valuable feedback and guidance.

In addition to the accelerator program, Warrior Rising also provides ongoing mentorship, networking opportunities, and access to capital to help veteran businesses grow and prosper. The organization not only fosters entrepreneurial skills, but also helps veterans create sustainable businesses that contribute to the economy and create jobs.

Thank you for your service.

Free resources, simple financing, and federal contracts won’t come close to repaying you for the service you’ve rendered to our country, but hopefully, they can play an important role in getting your veteran-owned business off the ground.

Let’s be honest. You don’t need any of these additional advantages, but they sure can help. You now have a business plan, financing to get it off the ground, veteran certification, and every resource you could imagine. Plus, you have the training, experience, discipline, and leadership to create a successful business. Now you just need to take action to make your business-owning dream a reality.

There’s a reason close to half of all American World War II veterans went on to become business owners. You notice problems and work hard to find solutions. You have the tenacity to fight for what you believe in, even if it’s not easy.

We thank you for your military service to our country, and we hope you can continue to make America a great place in a different capacity. As a small business owner, you can still play a significant role in your community, the government, our country, and the world. Now go get after it, entrepreneur.