Source of Finance Report

Source of Finance Report
I’m writing to you to give you more advice and guidance about which sources of finances should you go for. I’m going to give you a detailed analysis of the advantages and disadvantages of each source that will be appropriate for your business.
External and Internal Sources of Finance
External sources of finance are any sources of capital that can provide small business capital. For example a major external source are banks who can provide capital to your business to start up, the running operations of your business and for your company’s expansion. Internal sources of finance are any capital that is found within your business. For example you can retain yours profits for backs profits for business’s activities and also you can sell yours assets.

Owner’s Funds
Owner’s funds is providing your business with capital and expects the capital return back with interest, only when your business revenue is successful. Owner’s fund allows you and your business partners to take full control of money that you guys are contributing to your business.

I would recommend Owner’s funds because it is internal source of long term finance which help the owners of Caveman Brewery to ensure smooth transition from their initial start-up.

Advantages The advantage of owner’s funds that you don’t have to pay interest if you don’t get a bank loan, you and your business partners are in full control of the money. This means you can plan how going to spend your money, you may want to buy a new asset that helps meet the growing demand of your products. Getting more ingredients to add more to your stocks and advertising your business to the public to gain interest from potential customers and buyers.

The owners of Caveman Brewery will be more motivated to continue their success, and ensure that quality of their products and marketing meets the expectations of their customers and help gather more partners.

Disadvantages
The disadvantages of owner’s fund you