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Frequently Asked Questions
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How long does it take to get a loan?How long it takes to get a business loan depends on you. Everyone’s time schedule is different, with each of you completing the process at your own pace. Our staff are here to assist and guide you through each step as you prepare to start your new business or expand an existing business. You will work through Step 1 preparing yourself, then take the required entrepreneur class. Step 2 is where you will prepare your business plan and go through the loan request process. If approved you move into Step 3, preparing your business, If not approved for financing, you have the option of going back and seeing what you can change to strengthen your business idea. This process has taken one individual 5 months to complete and another has taken 3 years, so it all depends on your time commitment.
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Why do I need a business plan?A business plan is a fundamental tool with multiple purposes. The most common is to obtain financing. However, it also helps you discover and outline your business ideas and opportunities to determine if they will be profitable or not. It allows you to see your ideas from different perspectives to provide an understanding of how your business should best be put together. It provides a path to achieve your goals and objectives and serves as an evaluation tool to analyze how you are progressing. It can also be used to keep you on track and hold you accountable to achieve a better position for success.
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What do I include in a business plan?There are hundreds of models and methods to writing a business plan. However, 4-Directions Development provides a detailed business plan outline to describe the topic areas typical financing agencies looks for. Such as your Market Knowledge, Marketing Strategies, Management Plans, Staffing Plan, and your Numbers. Our staff is available to guide you through the business plan development process.
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Do you provide loans or grants?Business grants you hear about are typically awarded to nonprofit entities who assist entrepreneurs with their businesses; this does not include providing a grant to the businesses they assist. With the exception of small grants available for artists, there are only a few organizations that provide grants to for-profit businesses. 4-Directions Development provides loans only; managing 2 loan programs for the Red Lake Nation. The Red Lake Entrepreneur Loan provides up to 25% of the Total Project Cost and the State Indian Business Loan providing up to 75% of the Total Project Cost. A strong business proposal will provide at least 5-10% owner investment, where traditional financers require 25-30%. The loans are available to qualified members who are starting a new business or looking to expand an existing business. NOTE: Both loans are revolving loan funds that are only successful if borrowers make their loan payments and repay their loans. The repayments are then reinvested back into the community by providing business loans to other community members.
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Do I have to quit my job?Quitting your job to start a new business is a risky move and should be considered carefully. Giving up the security of a full-time job may not be the best solution when launching your new business and may add additional stress. Many entrepreneurs experience a fear of uncertainty which is normal; however, if you are considering quitting your job in order to start your business, here is a list of questions you may want to ask yourself: Do you have any high-end unique expenses that you need to cover? Does your business need 100% of your time to get started? How will you raise money to keep the business going? Have you factored in possible unforeseen costs? Are you willing to take on multiple roles? Are you flexible to the unpredicability in your life? Have you developed a good support and sales network? Is your support network on board? Do you have a backup option when the inevitable of irregular paychecks or gaps of paychecks begin happening? Is working part-time an option? Resources are available online to help you assess whether this decision is right for you. Please take some time to visit the site, www.entrepreneur.com, to view numerous studies, articles and published research on the entrepreneurial environment, experience, and industries in business.
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