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What do new businesses need finance for?
buying/renting equipment
paying for insurance/promotion/initial stock to begin trading
pay running costs (power, telelphone, wages)
What can new businesses do to attract sales?
sell on credit to their customers
What is internal finance?
Funds generated from within the business itself
What are four examples of internal finance?
Selling assets
Owners Capital
Retained Profits
Managing cash flow
Retained profits are…
profits that a business have made over time and kept in business instead fof distributing to owners and shareholders
Owners capital is..
funds that the owner of the business invests from their personal savings.
What type of business need owners capital?
sole traders
Sale of assets are..
the process of selling a businesses assets to make cash
What are some examples of assets?
Machinery
Buildings
Vehicles
Managing cash flow is..
reducing the time that customer’s have to pay invoices, while taking longer to pay supplies.
