Debt Consolidation Company Business Plan, Marketing Plan, How To Guide, and Funding Directory
The Debt Consolidation Company Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Debt Consolidation Company business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.
Your Business Planning Package will be available for download after your order.
Product Specifications (please see images below):
- Bank/Investor Ready!
- Complete Industry Research
- 3 Year Excel Financial Model
- Business Plan (26 to 30 pages)
- Loan Amortization and ROI Tools
- Three SWOT Analysis Templates
- Easy to Use Instructions
- All Documents Delivered in Word, Excel, and PDF Format
- Meets SBA Requirements
Debt consolidation is becoming more and more popular as the amount of borrowed funds among both individuals and businesses has skyrocketed over the past seven years. Since the end of the economic recession, credit has become more readily available among both individual borrowers as well as businesses that are seeking to expand their operations. It should be noted that the vast majority of debt consolidation companies specifically target individuals that have overextended themselves with high interest rate credit cards. As such, these businesses seek to consolidate your debts by providing a loan that allows for a much lower interest rate and monthly payment to be made. These businesses tend to do well in both strong economic climates where people have overextended themselves and are seeking to reduce their monthly debt expenditures, as well as within the economic recessions where people are scrambling to consolidate their debts due to the fact that they make less income.
The startup costs associated with the new debt consolidation can vary but most of these firms start with at least $5 million to $10 million in capital so that they can provide lower interest rate debt consolidation loans to their clients. It should also be noted that some debt consolidation companies will frequently operate solely in a brokerage capacity where a third-party financial institution is actually the one rendering the loan. In this case, the debt consolidation company startup cost can be substantially lower. Usually these firms to start up cost of $100,000 to $500,000 depending on the initial marketing that is going to used at the onset of operations. In this case, these businesses do not generate interest from loans are provided. However, in partnership with third-party financial institutions a debt consolidation company may be able to get a piece of each loan that is secured by the business.
The vast majority of debt consolidation businesses are started with either funds provided by the owner or from private investors. As this is a financial services business, they are typically not eligible for small business administration loans. However, as these businesses expand, they may be able to have access to a working capital one credit provided by a financial institution via a conventional debt capital raising. Of course, a debt consolidation company business plan is going to be required and this should feature a three-year profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratios page. For the industry research portion of the business plan, there are approximately 9,500 companies that engage in debt consolidation to the general public and these businesses accurately generate about $11 billion revenue year. The industry employs 100,000 people.
A debt consolidation company SWOT analysis should be developed as well. As it relates to strengths, these businesses are always going to find a market among people that have overextended themselves with credit cards and high interest rate that’s. As such, there are always going to be able to generate revenues not only from interest but also from the placement of new debt consolidation loans. Most importantly, these businesses typically have moderate startup costs and enjoy high barriers to entry once they are established.
For weaknesses, these businesses do face a substantial number regulations as it relates to how they can market their services to the general public. As such, a qualified attorney that has substantial experience in banking law must be a retained in order to ensure that the business can remain with the letter of the law at all times. Additionally, this is a highly competitive industry.
As it relates opportunities, most debt consolidation companies can expand by simply sourcing additional capital from third parties in order to provide a greater number of debt consolidation loans. Also, these businesses can develop third-party relationships with financial institutions where the where they act in a brokerage capacity rather than as a direct lender.
For threats, the regulations that guide banking and lending businesses change in an ongoing basis. This is the biggest threat faced by these companies given that there are a number regulations that must be adhered to at all times. As such, it is imperative that proper procedures and protocols are developed in order to ensure that these businesses can operate legally without any interruption due to regulation.
A debt consolidation company marketing plan also needs to be developed and this is important given that a substantial amount of the revenue generated will be allocated towards ongoing marketing expenses. In fact, many of these businesses often see that 10% to 15% of their aggregate revenues are allocated towards marketing operations. Foremost, many debt consolidation companies will take out televised advertisements that are shown during late-night hours among people who frequently stay up late worrying about debt or their finances. As such, this can be one of the quickest ways to establish an ongoing customer base at the onset of operations. It is also very important to note that many of these businesses also operate expansive online portals that feature e-commerce functionality that allows individuals to apply for debt consolidation loans and related financial services. This website can be listed among all major search engines and these businesses should maintain a presence on popular social media platforms like FaceBook, Twitter, LinkedIn, and Yelp. Many people do not feel comfortable going to a bank to discuss these matters face-to-face, and as such online management of debt consolidation has become the norm for most people.
Is also important to note that a demographic analysis showcasing the profiles of people that will be marketed to should be included within the marketing plan as well as the business plan. This includes examining annual household income, average amount of debt to be consolidated, average monthly payment of debt from each borrower, and their geographic location. This is important to know as many debt consolidation companies will start their operations in areas that are friendlier towards lenders rather than in more stringent states. A competitive analysis can be included as well but this can be somewhat broad given the fact that many debt consolidation companies are in existence. As such, one of the ways it should be discussed in both the business plan and marketing plan is how the business will differentiate itself from other lenders within the market.
People are always going to overextend themselves, and debt consolidation companies are always going to be in a position that allows them to provide credit to people who need assistance. It is not uncommon that people that are credit worthy borrowers simply take out too much debt and need to have their payments reduced. As such, these businesses will always remain in demand – in good times and in bad – on an ongoing basis. These can be highly lucrative companies for financial entrepreneurs that have an extensive understanding of lending.