It may be that you don't need to borrow any money to start up your optical practice. However, many new businesses do need to raise money to cover:
- the initial start up costs, such as equipping the premises, and smaller items such as business stationery
- working capital
There will almost certainly be a period during the first few weeks or months of trading when your optical practice is establishing a name for itself and your sales are still building up to their full potential. There will also be quite a long delay before you get your first payment for NHS work. During this period you will still have to cover expenses such as:
- wages if you employ any staff, and your own living expenses
- purchases of stock and consumables
- day to day premises costs
- running costs of a business vehicle if you have one
- sundry expenses such as computer consumables and photocopier paper
Because your income from your optical practice may not be enough to cover these outgoings during the early days, you will probably need to set aside some cash, or 'working capital', to tide you over.
If you need to ask the bank for a loan to cover your start-up costs and working capital, leave this entry in the cash flow empty until you have completed the rest. This will give you an idea of the shortfall between income and expenditure.
If your figures show that you're likely to need to borrow money, it's wise to check at an early stage in your planning that funds are available on terms that are acceptable to you.
Grants and other funding
You may be able to get some financial help in the form of a grant, possibly to cover the cost of any training needed by you and/or your staff.
You can get information on grant aid and other types of funding available throughout the UK from the business finance and support finder tool on the Gov.uk website.
Grant aid varies considerably around the UK and some assistance may be available in your area to help you start up your business.
It is also worth contacting the business support unit in your local council if it has one. Sometimes local grants are available for things like shop front renewal, or to help new businesses in economically run-down areas. You can also use the tool on the Gov.uk website to help you identify any suitable sources of local and regional funding.
Sometimes special grants are available to opticians to update their technology.
Grant funding is available for opticians from the Department of Health (DH) towards the cost of:
- earnings lost - or locum fees paid - due to compulsory continuing education and training (CET)
- supervising unqualified trainee opticians (pre-registration supervisor's grant)
To receive this funding, you will have to make a claim. There is more information on the Gov.uk website.