How did they raise the funds to start the business?

The initial funds needed were for financing the lease and to take over the rent and the rates of the original building. Because she was taking over an existing business, much of the equipment was already in place. She had to pay £800 for the fixtures and fittings. The funds were raised from Jilly and Paul's own savings therefore.

When the business moved to its new premises in the market square, Jilly had to negotiate a loan of £30,000 from the bank. To do this, she had to offer something as security on the loan and Jilly and Paul used their house for this purpose. This means that if the business was to fail and she owed suppliers money, she might risk having to sell her house to pay for these debts and to pay back the loan to the bank.

However, this is the worst case scenario and the get out clauses negotiated as part of the 25 year lease reduces the risk that she might have to resort to such drastic measures. Managing the finances of the business and ensuring that the business does not run up massive debts is an important part of the overall financial management of the business and helps to reduce the risk of losing personal possessions.

Image: Fixtures and fittings that Jilly paid for at the old premises would have included items such as the basins for washing hair.

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