When planning to take a loan in order to expand business into a new market, What you take in consideration before you start working on a plan of expansion and how much ROI should the plan target ?

First check the strategy against any SWOT (strengths, weaknesses, opportunities, threats) analysis in your business review.  

For expansion, the business might identify the following growth options:

• -increasing market share by starting a mail order operation
• -diversifying by adding computer printer consumables to its range
• -entering into a joint venture with an educational book publisher to sell books and stationery to schools.

• Therefore,  Sound financial planning is the foundation of any growth strategy. Firstly, you should establish:

  • 1. how much investment is required to fund the venture
  • 2. when it will be needed
  • 3. when it will be available

  so the marketing ROI strategy requires 

  -A detailed cash flow forecast is essential, not least because outgoings are almost certainly going to rise sooner and faster than revenues. Enough money must be in the pot to keep the core business running. It's a good idea to build in some surplus too, as most projects always take longer to bear fruit than originally predicted.

  -Detailed forecasts regarding sales, working capital and sources of seed funding, and even second round funding, need to be drawn up.

  -Businesses looking for capital investment, apart from bank loans, have three main sources - equity capital provided by the owner(s) or friends and family, venture capital and business angels. You can also see if any development or enterprise grants or loans are available in your area.

  -Equity finance is money invested in a business that is not directly repayable. It could be your own, most likely raised through re-mortgaging a property, or money from others taking a share in the ownership of the business.

  -Venture capital is investment by a fund in a business in the early stages of development. The deal will very often include a right to management involvement.

  Business angels are private investors taking a minority or majority stake in a business, often contributing valuable business experience in the form of advice and contacts.

- look into competitors share in that new market...

- best strategies I can adopt and implement to create my share in the market

Initial period I can think of no profit no loss situation and slowly would like to improve my business market share thereby to put me in profitable position. Thanks.

Step 1 : Gather all financial information. Before writing a business plan, you must have all pertinent information organized. Collect all financial statements, including profit and loss statements, balance sheets and at least three months of business bank statements. Also prepare a list of assets such as inventory on hand, fixtures and equipment. If starting a business, collect your personal bank statements from the last six months and prepare a list of all starting costs such as equipment, inventory and fixture purchases; costs of leasing and build-out; as well as legal costs such as registering the business with the state

Step 2 : Write a pro forma statement. Hire an accountant to write a pro forma statement, which is a projection of future expenses and earnings and are typically attached to a business plan when applying for a commercial loan

Step 3 : Create a business resume. A business resume is a document that shows a business' operation range, such as the services or products it provides to consumers and the experience and past business ventures and employment of the owner. If the business does not yet exist, write a personal resume or hire a resume writer

Step 4 : Draft a business plan. A business plan is generally about 15 pages and begins with an executive summary--a set of bullet points that show earnings projections and a summary of start-up costs. The business plan details how the company will operate, the products and services it will offer, operating hours, management structure, number of employees, wages and benefit costs, operating costs (such as lease, insurance, licenses and permits) and explains how the business will market itself. Contact a professional business plan writer or business attorney or accountant to write the plan. Or you can download business plan software such as Plan Write or Business Plan Pro

Step 5 : Apply for a commercial loan. Visit the Small Business Administration's website and find an approved commercial lender in your area. Contact the lender and ask what documents are necessary to apply for a business loan

Debt is great only:

1. If your annual plan is cash flow positive before the first installment
2. If you're part of a growing industry
3. If you're technologically equipped to hit your targets

Your feasibility study must take into consideration SWOT. Any assumptions used for the cash flow and the ROI shall be on the conservative side. The business plan shall only be followed if it seems profitable even after following the above-mentioned assumptions. Otherwise, the strategy shall be reconsidered.

One of the major difficulties in using this pricing method is that an investor must pick both a return that can be reasonably attained, as well as a time period in which the target return can be reached. Picking a high return and a short time period means that the venture has to be much more profitable in the short-run than if the investor expected a lower return over the same period, or the same return over a longer period.

the benefit from loan

where mine will spend it and are i'm need for upgrade my business or i can less my expensive to cover it