THOUGHT OF THE WEEK
TIPS FOR BUSINESS FINANCING (PART 2)

SOURCES OF FUNDING FOR A BUSINESS
A Business needs to categorize their sources of finance, these should be divided into internal (sources within the business), and external (sources from outside providers)
INTERNAL SOURCES
The main internal sources of business financing are a. Personal sources: It is one of the most important sources of finance for any start-up company
b. Retained profits: It is the cash generated by the business when it makes profits. This is a source of funding for already existing businesses whether big or small. E.g. A business sold some products and made profit of GHS 50,000.00. This means that the retained profits are GHS 50,000.00 and can be used to finance expansion of the company or to pay for other costs and expenses.

c. Share capital: This is the funds invested by the founder (s) of the business. The founders of a business can invest in the share capital of the business for the purposes of forming a start-up company. This is a common start-up financing method. Where the founder of the business provides all the
share capital of the business making them retain 100% control over the business….(to be continued)

Disclaimer
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