Home Money I want to apply for a loan for my bakery but I have bad credit. What should I do? DAVE FISHWICK responds

I want to apply for a loan for my bakery but I have bad credit. What should I do? DAVE FISHWICK responds

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I want to get a loan for my bakery but I'm worried about my credit score. What should I do?

I am in the process of setting up a baking business. Our products are very well received and the aim is to have a small bakery in Chester, where we live, offering delicious savory and sweet treats.

We also want to supply local companies with our products. We have started attending markets, etc., which is going well.

My question is, where would you recommend we get a business loan? However, I have bad credit, which is really holding me back.

We have had a really difficult year, my partner and I have been laid off and now we want to start our own company and profit from it. via email

I want to get a loan for my bakery but I’m worried about my credit score. What should I do?

This Is Money business doctor Dave Fishwick says: My friend’s father ran a bakery specializing in artisanal continental bread and a small range of sweet products.

They supplied exclusively to other businesses, including numerous independent retailers and a regional supermarket chain.

The answer is that supplying to the trade means margins are much tighter than those of a retail bakery, and many retailers also expect “sell or return” terms, creating significant waste and further reducing profits.

There is a lot more work and costs related to logistics, staff, etc.

In short, I have been told that it is difficult to profit from a wholesale bakery, so perhaps it is something you should try once you are well established and perhaps want to take advantage of the economy of scale.

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That said, supplying restaurants and catering companies could be useful for earning additional income over time.

It sounds like you have all the ingredients to launch a successful business.

My advice would be to keep your debt to a minimum so that repayments and interest costs remain a small part of your expenses.

Firstly, there are various government grants and initiatives to help businesses get started and survive.

Most local councils have a technical support service for companies and ambitious people like you who plan to start a new business.

Send us a note at Burnley Savings and Loans and we will put you in touch with a member of our team, Mr Purves Ali, who will give you some advice on all your options.

money item html_snippet module" data-channel-color="money"> David Fishwick

Purves is an experienced and accredited business advisor with over 20 years of experience delivering new business projects.

Provides advice and support to emerging and existing businesses and advice on all available funding and grants.

You mentioned that you have bad credit in the past, so you would be looking for a subprime loan. You can search for specialized subprime brokers online.

My advice is to look for a loan company that will perform a manual assessment rather than a credit score on your application, as this will give you the best chance of presenting your case to someone you can actually talk to rather than a 300 minute computer. miles away, it does. He doesn’t know or understand your situation and in which case he will say No or offer you a ridiculously high interest rate.

Starting small is certainly the best way and will allow you to learn the business without overhead and costs getting out of control.

I also have a friend who opened a small bakery specializing in dog products, especially dog ​​products, and started the business in her kitchen at home, Dianne from Millie and Ruby Dog Biscuits in Burnley.

Dianne started small and built the business slowly but surely, only increasing her overheads as she grew her customer base, turnover and profits.

I always say that turnover is vanity and profit is sanity. Remember slow and steady wins the race. Good luck!

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