Bank lending is back on the news agenda, this time with the message that SMEs aren’t seeking finance. Our experience is that confidence and growth potential exists for companies that are ready and willing to take advantage of new opportunities. If an injection of capital would make your business plan a reality, check out our top tips on getting the banks to say yes.
All in the mind: Most business owners have a clear idea of where they’re heading – in their head. Committing your business plan to paper, before your funding application demands it, will help clarify your strategy and identify strengths and weaknesses. It will also provide proof of long term planning, control and profitability.
Dig deep: Most investors willwant to see that you are personally committed to the business, and that you are highly motivated to succeed. “Sweat equity”—unpaid personal time and hard work—can be important, but lenders like to see an entrepreneur with an important financial stake in the business.
Show of strength: You need to demonstrate your ability to control every aspect of the business – especially delivery. Factors such as staff loyalty, documented systems and processes, client testimonials and CVs showing that employees have the skills and the experience to make the company a success are all important.
One size doesn’t fit all: Investors avoid businesses that claim to be everything to everybody, instead preferring specialists in target markets with high growth potential. Make sure your business plan explains why you are different and have a competitive edge over rivals.
Do their homework: Include an analysis of your market sector in your business plan so that investors and lenders can clearly see the growth potential. Also, try to show that a good profit is achievable in a short period of time, linking it to market research as well as your business strategy.
For more advice and information on how to secure funding, please contact the Corporate Finance team
