And when it comes to choosing finance, the options seem endless too. Ali Joyce from Credabl explains “All banks and financiers have different appetites, products and terms. Dealing with these lenders on a daily basis and understanding there offerings allows me to direct you to the best place to set up your loans.”
At Credabl, our team has been dealing with medical and dental professionals for over 30 years so we understand your industry and can help guide you towards the best loan structure and facility suited to your circumstances.
So where do you start?
Plan plan plan! They say “Failing to plan is planning to fail”.
A business plan is a great way to get your ideas out of your head onto paper. Do as much research as you can around location and competitors and surround your-self with professionals that understand your industry. A specialist accountant, lawyer, insurance broker and a finance consultant (from Credabl of course!) will be able to assist in making your plan come to life.
Setting up “shop”
Finding the balance between a space that is big enough for future growth but not so big that it’s a waste of space can be tricky. Also remember, the bigger the space, the more it will cost you to fit out. If you’ve found a big space, you may even consider sub leasing additional rooms to other medical professionals until they are ready to grow their business.
How much should I spend on my start up?
Knowing how much to spend on setting up will come down to your cashflow projections and what you believe is achievable! It’s important to consider not over capitalising. Will your patients notice if the counter tops are marble?
It’s common practice to want to pay invoices for the fit-out and equipment in progressive payments. Setting up a drawdown facility allows you to make payments to suppliers over a period of time. This may mean you don’t have to make any repayments on the facility until you have completed the works, which is great for your cashflow and gives you time to work on getting patients through the doors (money in the bank!).
Once you have finished paying all the invoices you need paid, you can then convert the drawdown into a chattel mortgage or a lease. Often, the fit-out portion is funded under a lease, as you can write off your full repayment as a tax deduction (as fit-out is slow depreciating). Equipment on the other hand is more likely to be funded as a lease or a chattel mortgage, depending on your accountant’s recommendations. With a chattel mortgage you will be able to claim the GST portion of the purchases upfront and then claim the interest and depreciation over the life of the loan.
So, are you ready to take the plunge? It’s not as daunting as you may feel, especially with the right partners by your side. Contact a Credabl specialist to discuss your options. We’d be glad to help!
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