Your answer should come while you are developing your business plan. You may need funding for the following purposes:
- fixed costs such as building, equipment, furniture, technology
- funds to support initial production runs. This means purchasing raw materials and staffing production
- funds for administrative and start-up costs
- funds to cover personal expenses during the initial start-up period. It is probably well to plan for a start-up period that may last six months to a year.
A completed cash flow statement that includes the first few years of business operation will indicate how much money you will need to get your business to a somewhat sustainable level.
For additional information on business finance, go to the Small Business Administration Web site.
