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A Cautionary Small Business Tale

Great CNN article submitted by Marti Benedetti called “How to lose money fast:Open a Business.”

Many people go into business with an overly optimistic attitude and little or no preparation. Some start up business owners avoid seeking technical assistance or counselingcounsel as they do not want to hear that there may be something wrong with their idea. Smart business owners do their homework and look at all the potential hidden costs. The bar owner in this article had a business plan but it is unclear for example if he talked to other bar owners or did a competitive analysis.
Banks, who are not doing much in the way of lending right now have always disliked start-ups, considering any business open under 24 months as part of that category. If you can get a bank to consider a loan, they will generally expect you to break even some time in the first year. As a result, many people show a cash flow projection that is not realistic in order to please the bank and get the money.
Of course no one could foresee this current economy and its effect on the bottom line of small businesses. Owners have had to dig into their own pockets in order to stay open and those pockets are not as deep as they once were. But the entrepreneurial spirit endures an we have seen an upturn in the number of people coming to the UNF Small Business Development Center for assistance.
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