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10 Things a Lender Looks at

Write your own success plan

Your business plan is more than just a roadmap, it demonstrates your financial readiness.

Your Business Plan

Lenders are more likely to approve financing when your plan defines potential risks, highlights your managerial skills, and includes clear financial projections. Plans should outline the following:

  • Executive Summary
  • Company Profile
  • Products/Services you provide
  • Marketing Plan
  • Operations Plan
  • Financials

Top 10 Things Lenders Focus on when Reviewing your Plan

  1. Financing Request
    Your financial request should be clear about the amount you need and should define how the money will be spent. Ask yourself: Would you risk your own money on this business?

  2. Business Description
    When creating your business description, define your products or services and describe your market. You should also include an outline of your business objectives.

  3. Management Expertise
    Highlight your business management expertise and experience in the following key areas: products or services, marketing and sales, and finance.

  4. Financial Plan
    Map your financial plan by defining your start-up costs and your projected revenues and expenses. This will help you decide how much equity you will need to contribute. Ask yourself: Can I repay the loan?

  5. Cash Flow Projections
    You’re more likely to get approved for a loan if you can demonstrate sufficient cash flow. Your projections should be proven or supported in your plan, along with your ability to make your monthly loan payments. A two year cash flow plan may define an expected scenario, a slow-start, and an aggressive sales.

  6. Contingency Plan
    Things don’t always go as planned, so it helps to identify potential risks and how you will mitigate each risk. Your plan should include risks such as: economic, legal, technological, social, political, and environmental.

  7. Security
    Loans can be secured by your assets such as: real estate, equipment, vehicles, inventory, and cash.

  8. The Marketplace
    Define your target market and consider the potential risks of your market such as: customers, competition, suppliers, and industry trends.

  9. Market Demand
    Evaluate your market demand by asking yourself these simple questions: Why will people choose me over the competition? What is the demand for my product or service? How do I plan to reach customers?

  10. Third-Party Review
    Ask a Business Banker to review your plan. They will help you identify gaps in your plan for improvements or clarification.