Most applications for bank finance are rejected, not because customers are poor credit, but because he went to his bank unprepared. Get a head to communicate the right information the first time.
CASH data showing that they understand and can manage their working capital (debtors, creditors and stocks) and that the money in your company enough for the interest of banks (and other major expenses such as taxes, dividends and capital replacement ) to cover. “Cash is king”, and even profitable businesses can fail if the cash is not correct. Understand your cash movements and may even be necessary to borrow less.
OUTLOOK The current estimates of the required amount, payback, risks and returns to the bank to communicate. The figures to be more advanced than expected sales and profits and ideally see the relationship between profits, cash flows and balance. Sensitivity analysis is important to help the bank to understand when non-payment risk.
MARKETS Put your market.
MIX AND QUALITY CUSTOMER Details of the customers by name / industry / region / length of contract. Building your business around the risks of a senior business customer.
UPDATE Dar updated information bank management, especially if the accounts are dated. The information must be submitted at least every three months, divided in the department or region, and include earnings, balance sheet and cash flow interruptions. The management of information should be used for budget forecasting data / update and any differences should be explained.
Show the liquidity of the banks that your business can survive and fluid. Think beyond a simple current assets / liabilities ratio, and consider its liquidity ideal. I remember a lot of liquidity, the assets could generate higher returns elsewhere.
INCOME Know your financial definitions. Are you talking about gross profit, operating margin, net income or EBITDA (earnings before interest, taxes, depreciation and amortization)? All are common in the financial analysis of companies.
COMPETITION tell the bank how it performs compared to your competitors? Be prepared for your competitors strengths and weaknesses discussed. This gives confidence that a team of proactive management that really understand the business.
Break ACTIVITIES activity your company / business and tell the bank that the activities are working well and are a cash drain and why. Finished with estimates if necessary.
Start PATH Unless, of at least three years with the bank accounts (5 years perfect when approaching a new bank) and to date management accounts. A bank will need this information for financial analysis of trends in proportions and margins.
Equity, debt and communicate their risk BALANCE (Action / directors loans) against risks to the bank. Learn the true strength of the balance by having the current market value of assets on hand and all the details of the debt (including off-balance sheet risks, such as guarantees and leasing).
Forward Finance are experts in financial analysis and industry, qualified accountants, bankers and analysts rated combined city who speak the language. With our comprehensive financial package a professional approach from lenders, shop around and negotiate the best rates in a stronger position. We also offer historical competition and market analysis.
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