Posted by Matthew Deutsch on November 21st, 2011 at 05:23pm
In this article, we will discuss the development of an Internet Service Provider SWOT analysis, its development, and how it can be used to acquire financing from a bank or investor. Internet service providers generally are able to remain profitable and cash flow positive in any economic climate due to the fact that they are able to render a service that is in constant demand among the general public. One of the best aspects of a internet service provider is that they are able to generate highly gross margins from their services. A well written Internet Service Provider SWOT analysis will feature a strengths section, a weaknesses section, and opportunities discussion, and a threats discussion. One of the best things about this business is that they are able to generate highly recurring streams of revenue by providing internet access on a regular basis. Additionally, very few people usually change their internet service provider once they have established a relationship. This is important to note in your SWOT analysis when you are seeking financing as your revenues will be highly predictable. Additionally, one of the most important things that you will need to showcase is that fact that you ISP will have a large number of tangible assets that could be easily sold to a third party. You are also going to need a correct profit and loss statement, cash flow analysis, as well as a balance sheet.
Most importantly and first, you are going to want to focus heavily on the strengths that are associated with your internet service provider. Foremost, you should again reiterate the high gross margins generated from your internet service provider services while also showcasing the generally low costs associated with operating this type of business. Another important mention should be the relatively low cost overhead associated with operating this type of business.
Also within the strengths section of the SWOT analysis, you should focus on your abilities to operate this business on a day to day basis, your experience as an entrepreneur, and how you intend to bring the operations of your internet service provider to profitability very quickly.
The next section of the Internet Service Provider SWOT analysis focuses significantly on the weaknesses that are associated with this type of business. Foremost, you should heavily discuss the fact that there are many other types of businesses that operate in a similar capacity to your internet service provider. You may also want to discuss the relatively high start up costs that are associated with a internet service provider.
Next, you are going to want to focus significantly on the opportunities that your business will have to expand during its first five years of operation. This may include developing new locations, hiring additional personnel, and engaging in a broad based marketing campaign that will ensure that your internet service provider business is able to rapidly expand and repay its debts on a timely basis.
Finally, you are going to want to effectively showcase to your SBA loan banker or investor the threats that will be faced by your internet service provider. We strongly recommend that you emphasize a number of these issues as it will be to the benefit of your investor or banker to see how you intend to mitigate these risks as time progresses.
As always, we strong recommend that you work closely with a number of professionals including CPAs, attorneys, SBA loan consultants, conventional loan consultants, and other professionals that will ensure that you have produced a Internet Service Provider SWOT analysis and business plan that is appropriate for both a bank and a potential investor. It is imperative that you have a clear understanding of the complex nature of raising capital for your venture and by having a number of professionals in place – you will be in an outstanding position to receive the capital you need in order to start your internet service provider.
Tags: Balance Sheet, Cash Flow Analysis, Economic Climate, Focus, Gross Margins, Important Things, Internet Access, Internet Providers, Internet Service Provider, Internet Service Providers, Investor Internet, Profit And Loss, Profit And Loss Statement, Provider Services, Relationship, Showcase, Streams, Swot Analysis, Tangible Assets, Third Party
Under SBA Loan SWOT Analysis