Watch this video to see the questions at the training:
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Read Some of the Questions We Have Clarified on this Blog’s Comments Section.
Q- There are two questions that I don’t understand.
Â State the process of any loan application.
Describe any existing finance loans related to the business.
Does it mean I will write how to seek for loan or a loan Iâm processing currently? Secondly, am I going to describe an existing finance loan am processing?
Answer – For existing businesses, YouWiN wants to know if you have received any finance loans recently or one that is ongoing. If you have, this is the section where you describe the loan.
By stating the progress (not process) of the loan, you are required to describe the stage of the loan. Have you received the money? Are you paying back at the moment?
Q- Does the question âHow much will you take from the business?â refer to salary? Or what? Thanks.
Answer – In a way, it refers to your monthly salary. However, it is usually advisable that this amount is not more than twice the salary of your highest paid staff.
Q – Please are 5 staff too few for me to employ in a catering business 12 months after collecting my first grant? Again I donât understand this â âWhat are your current expected sales within the next months? (Units and income).
Answer – It depends on exactly what you need. Remember that it is counter-productive to employ too many or too few staff in an enterprise. Since you are writing for YouWiN, I would suggest that you employ just an adequate number of staff. Donât employ less than you need!
This question, about your expected sales, refers to the total income you expect in one full year. YouWiN expects that you give the total number (or units) of goods expected to be sold or services expected to be rendered in that one year, and how much money (in one whole year) you expect to earn from doing that â not profits.
Q Â – The question âWhat is the minimum cost that is necessary to commence business or expandâ & âDescribe the equipment â.
Answer – YouWiN funds are disbursed in tranches â two, three or four tranches.
This means you are not likely to get all the money you are asking for immediately from YouWiN. So, you must be able to tell YouWiN the minimum amount of money you think you will need in your first tranche in order to commence business (if you are a start-up) or expand (if you have an existing business).
Most likely, this âminimum costâ will cover really inevitable equipment. You will have to describe the equipment.
Q – Please I do not understand this question âWhat amount of sales in naira per month, must you achieve to reach profitability?â
Answer – This question is about your break-even point.
The first phase of any business is usually an initial investment with no profit. Overtime, you grow your income to a level that you become profitable. It is at this point that you can say your income is greater than your expenses.
Your break-even point, therefore, is the amount of your income at the cross over point to profitability. I hope this is clear.
Q – Concerning the last question that you answered â What amount of sales in Naira per month, must you achieve to reach profitabilityâ â I have done the breakeven analysis and I arrived at an amount that I sell to reach the break-even point per month. How can I estimate the amount to reach profitability.
Answer – Once you have done your breakeven analysis, your calculation is 99% completed. The amount of sales to reach profitability is the total of your sales to reach breakeven + one sale. This means that your business becomes profitable when you make that one more sale after reaching your breakeven point.
YouWiN is asking you this question just to be sure you totally understand the business you want to do.
Q – Thank you for this great service. Please how do I get to answer this question; âWhen do you expect to achieve this (how many months after receiving your first grant award)?â What do they imply by this question?
Answer – First, you have to determine how many items you will have to sell (or produce and sell) to break-even and become profitable. Then, estimate how many months you think it will take you to sell that number of items.
Q – What I actually wanted to ask is how to get the monthly breakeven point. Most of the costs usually come up annually and most are one-time costs e.g. equipment costs. Again, how do I really know when to get to the point? Is it by guessing?
Answer – The breakeven question is quite simple. How much are you pumping into the business? Say 10 million, letâs assume the product you manufacture and sell is a thousand naira per unit, and you make a profit of 100naira on each unit, you have to sell 100,000 units to breakeven. Any sale after that puts you in profit. The next question is how long will it take you to sell 100,000 units. If you sell 8,000 units per month, it will take you 12 months and two weeks to breakeven.
Before you submit your application, make sure you review your business plan with a knowledgeable person or professional.
We can help you review your YouWiN Application. Click here to see our services.