Have you ever thought of starting your own business? Take a look at this example of a start-up business, and learn lots of useful business expressions along the way.

Have you ever thought of starting your own business? Take a look at this example of a start-up business, and learn lots of useful business expressions along the way.

For the purposes of this article, we’re going to imagine that you’re starting a hair salon business… Snips hair salon, to be precise. Are you ready to set up your business? Do you think you’ll make it to Wall Street? Let’s see.

The first thing you’ll need to do is a bit of market research. You’ll need to find out what people are looking for when it comes to haircuts and hairstyling in the area that you choose. Then, once you’ve identified your target market, you’ll need to decide how much people are willing to pay for the services you offer.

The most important thing about your business is that it should have a USP – a unique selling proposition. This is something special that makes it different from the competition and that sets you apart in the market. Apart from offering a professional service, Snips is going to be open for 24 hours a day, plus it’s got its very own line of organic hair products. They are produced with Fair Trade goods that won’t harm the environment and they haven’t been tested on any animals. This is your USP!

Now you’ve got your USP, you’ll also need to create a logo and a slogan for your company, and decide on your corporate colours. This will be important for creating your corporate look and for when you design your premises with all the accompanying signage.

Now you’re going to need to write up a business plan. This should include a short description of the business, who you are, what you plan to sell, why and to whom, your marketing and sales strategy and your markets and competitors. It could also include information on your management team, and any financial forecasts.

When doing your business plan, it’s also important to establish your break-even point – how much money you need to turn over in order to cover your costs, and when you will start to make a profit.

Once you’ve got your business plan and ideas, you’re going to need some finance. One option is to take out a loan from the bank. If you do this, you’ll have to pay back the capital and the interest. Alternatively, you could mortgage your house and get a loan against that, or you could even ask friends and family to invest in your business in exchange for shares. However, in the end, you manage to convince the bank to give you a loan. Congratulations! You’re now ready to open your first Snips hairdressing salon.

First of all you’re going to have to spend a bit of that money. Most importantly, you’re going to need to rent somewhere for your business. Remember the famous expression, “location, location, location” – it’s key in business! You’re also going to have to invest in some equipment for your business: chairs, hairdryers, scissors… Finally, you’ll need to register the company name, the logo and the website address, and then you’re ready to open! You’re in business!

The first few months are extremely exciting, especially when you start making money. As far as promotion goes, it’ll initially be fairly small scale –flyers, ads in local newspapers and posters in the street. However, your most important form of advertising will be word-of-mouth. So, you’ll have to be careful to provide good customer service.

As bills and money start coming in and going out, you’re going to need to use a basic spreadsheet to keep control of your expenses. Above all, you’ll need to keep your cash-flow under control – especially if you’ve got to pay wages (you don’t want to get to a situation in which you can’t pay your employees!). However, as business builds up and your volume of business increases, you’ll need an accountant to take care of things.

Having an accountant is extremely important. He or she will make sure your accounts balance, and that you’re earning more than you’re spending. This means that you need enough money coming in to pay all the overheads – and that there’s sufficient to cover your fixed costs and your variable costs. Above all, this will hopefully stop you from going bankrupt!

Now you’ve got your finances under control, you can reinvest some of your profits in the business. The best thing would be to buy the business premises. This will add to your assets and put your business on a sounder footing. It can also be used as collateral if you ever need to take out another loan. And you’ll be able to amortize the payments on the spreadsheet.

As things start going well, you start recruiting and hiring more employees. Now your turnover is really picking up and you’ve got your cash-flow nicely under control. You’ve established clear systems and processes for doing things and everything is working smoothly. You’ve even got enough to pay yourself a very nice salary!

In fact, things are going so well that you feel it’s time to expand. So, you open another Snips hair salon in a different part of town. And that goes well too. So, you open another one and another. After a few years, you realise that your business model could work in the rest of the country. But you’re going to need some more money. What can you do? Simple! Sell some of your shares.

Luckily, there are some investors who are potentially interested. But it isn’t going to be easy. They want to see what assets and liabilities the company has. They’ll also need to know how much you’re turning over, how much profit you’re making and whether you’re a high- or low-risk investment. They’ll look at how highly leveraged you are, and they’ll want to evaluate your intangible assets: your trademarks, copyrights, patents and general goodwill.

Congratulations! In return for 20% of the shares in your company, you get enough money to open up hair salons all over the country. Things just keep getting better and better. But it isn’t going to be easy. The investors are going to want to see an annual report, and you’re going to have to provide them with a balance sheet. Plus, they’ll want to receive dividends, but that’s no problem, because you’re really making a very nice profit now.

But why should you stop here? Why not make your business global? Yes, good idea, but how? Once again, simple! Talk to some venture capitalists. So, after another round of meetings, you sell a further 29% of your equity in return for enough money to start operations in sixteen other countries! Well done!

But it doesn’t stop there. After a few more years of phenomenal success, you decide it’s time to float your business on the stock market. It’s time to go public! Your company is listed and your shares are traded on the international markets. When it’s a bear market, they’re falling, but when it’s a bull market, your shares are shooting up. Life’s sweet!

Who said your concept couldn’t make it to Wall Street?

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