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How to Finance Your Small Business: The Services Edition

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2021 07 23 finance ur biz services

[5-minute read]

Written by guest writer and Truevo Growth Marketer, Marlene Bramley

Think of the economy as a massive machine. Each business category plays its part in making the wheels of the economy turn. Manufacturing and mining provide the raw materials and know-how to make all the parts. Factories assemble, and logistics deliver. The services industry is the grease that makes the whole engine turn. It’s the cleaning companies that ensure everybody works in a safe space. The cooks who feed us, the accountants who count everybody’s meals, the lawyers who fight for our rights to have another plate, the designers who work out how they can serve a gram but make it look like a pound, and the packaging people who wrap it all up. These service industries keep the show on the road. And their needs are very different. 

Glass ceilings and clones

All it takes to start a business in the services industry is a gap in the market and some serious skills. In some industries like tourism and hospitality, you might need to invest in equipment initially. Even this has changed over the last year with equipment rental options becoming available as businesses pivot after the pandemic. So with your skills in hand and a head full of plans you arrive at your desk and start your business. It can be as simple as that. Obviously, it gets more complicated once you’ve realised you’re not the only one with this vision. The services industry is notoriously competitive. You have to really focus on time management, cost control, and competitive pricing if you want to make it in this space. Although entry into this market is relatively easy, the big drawback is that there is only one of you, and there are only so many hours in a day. The glass ceiling is exactly that. You can see where you want to grow but you are restricted by your own capacity. 

Your options are to either clone yourself, automate where you can, or expand. Each option comes with its own challenges. Cloning in particular can really take it out of you. 

Seriously, the same principles apply whether you want to start a retail business or enter the service industry. You need to have a solid understanding of your income, costs, overheads, and other financial indicators. A business plan will also help you find your way. 

Go fishing 

The service industry has been extremely affected by the pandemic. The Irish government has woken up to the importance of this industry and made various funding schemes available to help service businesses recover and grow. To give you an idea of how important this sector is, a report generated by Jim Power Economics for Alliance Ireland states the following: 

“In 2017, there were 207,172 Services & Distribution business enterprises in Ireland. Of this total, 206,809 or 99.8% were categorised as SMEs. In 2017, these 206,809 SMEs: 1) Employed 833,843 employees, accounting for 73% of total employment in Services & Distribution. 2) Generated €268.3 billion in turnover, accounting for 66.4% of total turnover in the Services & Distribution sector; and 3) Accounted for €57.9 billion or 59.1% of total gross value added in Services & Distribution.” 

So, if you want a financial injection now, go and fish where the megalodons are. There are various government support schemes for the service industry at the moment. Let’s have a closer look at some of them. 

Sardines are also fish

Even small grants can help you pivot, grow, and survive. There are various Government support schemes for restaurants, musicians, and other businesses in the hospitality industry awarding grants between £2,500 and £10,000. The Outdoor Service Enhancement Scheme will help restaurants expand their outdoor seating areas. The Music and Entertainment Business Assistance Scheme (MEBAS) supports eligible businesses in the live entertainment industry, and the Live Performance Support Scheme supports commercial producers and promoters as well as artists, musicians, technicians, and other support staff.

Although some of the submission dates have passed, there are updates and information regarding ongoing schemes available on the Department of Enterprise Trade and Employment’s Supports
booklet (pay particular attention to Section 4). The booklet also provides information on schemes aimed at designers and various other industries. You can also find the latest information on the Government of Ireland – COVID-19 and Department of Enterprise, Trade and Employment sites. 

Edge Growth provides various kinds of customised support for SMEs at various stages of their growth cycle. You’ll need different advice and support programmes if you’re taking the initial leap into self-employment or if you’re at a more advanced entrepreneurial stage. Edge can help you whether you need a mentor or an investor.    

You’re safe in a shoal 

Many SMEs are grouping together to either sell their services to corporates or to leverage community buying power to reduce their costs. The Irish SME Associates (ISME) runs a membership-based programme where SMEs get preferential rates, added services, and access to selected companies across a range of industries. They offer services from accounting, advertising, broadband, insurance, software, training, and much more. Consider joining them. You will get great deals on any of the services their members offer or you can take advantage of their marketing and perhaps pick up some clients of your own. 

Have a look at Enterprise Ireland’s funding page. They provide information on various available avenues for businesses in different sectors and phases of development. 

We discussed funding for startups in a recent blog post, have a look to see if there are appropriate resources for you there.

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