Do you want to start a cash checking company from scratch? Or you need a sample cash checking business plan template? If YES, then i advice you read on. On one or two occasions, you may have had reasons to use the services of a cash checking shop to cash out your payment check.
Cash checking business is very popular these days; and you can build a lucrative business by offering cash checking services to people in your location and beyond. This is because many Companies and Organisations prefer to pay their employees via check instead of going through the stress of making bank deposits for each and every one of their employees.
Your job as a cash checking business owner is to pay customers the cash equivalent of their check after they endorse it; and you make money from the processing fee which is a certain percent of the total amount which in most States is up to 10%.
The business is a very lucrative one but comes with some degree of risk. In this article, I will give a detailed explanation of things you need to start cash checking business and also steps on how to start a cash checking business.
3 Things You Need to Start a Cash Checking Business
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A cash checking business is a very cash intensive business; you need a big capital base to get started because you will need to have enough cash to pay your customers before you get to process the check in the bank later; and you may get customers that will come with checks of up to ten thousand dollars. All I am saying is that you have to have access to a big capital base to run this business.
Busy location is very vital for this business; you can still successfully run it in a less busy location but it will take a lot of adverts, marketing and creating awareness for people to know about your business.
Check Cashing Business Management Software
This may be the most important thing you need for your business. Why? The reason is because the check cashing management software in compliance with government standard gives you access to identification database for verification of checks. That it, the software helps you run through various databases to ensure that the check is not a bad check.
Starting a Check Cashing Company – Sample Business Plan Template
The first step is to write a business plan. How do you intend to run the business? What is your capital base and how do you go about having access to the capital? Where do you see your check cashing business in the next two or three years? What steps are you willing to take to achieve the goal?
Answers to these questions will serve as a guide while writing your check cashing business plan. Also, before an investor gets to invest in your business, he or she will always ask for your business plan; so your business plan has to be as explicit and detailed as possible.
I already mentioned earlier on that this business is a capital intensive business and you need to have access to money to run the business. you can use your personal money if you have a lot of it saved up, you can take out a loan from the bank, but try to work out a favorable repayment plan to give you time to pay back the loan.
3. Get the Required Permit to Run the Business
You need to inquire from other cash checking business owners to know the necessary licenses and permits you need to get to run the business in the state. If you are running the business as a franchise, you may not have to go through this process. Will talk more about the franchise later in the article.
No matter how tight your verification and payment policy is; there are a lot of risks in this line of business. For instance, you may pay a customer for a bad check or a bounced check before you get to know.
So in other to cover your business and reduce risks and liabilities, you need get a business insurance that covers such liabilities and also from fraudulent employees. Business insurance is very mandatory to protect against debts especially if your startup capital is a loan gotten from a financial institution.
I have talked about the importance of looking for a good location for your check cashing business; so find an available location to serve as an office space in a busy location.
You will need to get employees to help you run your business. Carry out a background check on your intended employees to ensure that they don’t have any history of crime, because you need trustworthy people as employees in this line of business.
If your office is located in a busy environment, you wont need to spend much on adverts but if your business location is not that busy, then you can advertise your business by sharing complimentary cards and fliers. You should also create a website so that people who are looking for check cashing points in the location via the internet can easily locate your business, and you can advertise in local business magazines in your state.
The process listed above is for persons who wish to start their own cash checking business from scratch. You can grow it into a franchise where people can use your Business Name to run their own business for a franchise fee; but if you feel that you can’t go through the steps of starting your own check cashing business, you can apply for a franchise from any of the popular cash checking companies in the country.
And for some reason, operating as a franchise is easier because you will not need to worry about the capital base, and other expenses like advertising, getting the required licenses to operate the business and also payment for business insurance. But whichever way you wish to go about it, this article has given enough details to give you a head start to run your check cashing business.