Making your business loan interview a success! Whether it’s a review of your current lending facilities or applying for a new loan, you’ve been thinking about it all morning, knowing your business banker will be on time, that’s how they work!, they love numbers and you are worried about what they will think of your business. Some tips to make the time effective; Prior to the meeting: 1. Set an agenda - this is the best way to determine whether the banker you are dealing with is serious about your business. If they don’t send you an agenda before the meeting, request they do so, so that you can prepare before hand and don’t be afraid of letting them know what you want to discuss. 2. Have everything ready -

• Most recent financial statements including, profit and loss, balance sheet and cash flow statements. If these are still being prepared by your accountant, provide drafts from MYOB.

• Most recent tax returns, including your partners. • Up to date business plan including cash flow projections. • A letter from your accountant stating all statutory obligations are up to date, including GST, superannuation and tax payments.

3. Photos - most of the decisions made about your loan application are made by credit risk managers that often located in a different area. As a result they may not know your business or the area particularly well. By taking photos of the premises you wish to finance or your current business premises send a powerful visual sales pitch. During the meeting: 4. Introduction, not all business bankers sit in ivory towers in the CBD and ponder ways to increase your lending margins, often they are based at local business banking centres and have a very good understanding of local business. As a result it is a good time to ask them how their other clients are going and the general market conditions, you will be surprised, often they could also look after your competition. Ensure you have the meeting with no distractions, let staff know you are not available and turnoff your mobile. Even when meeting on site, it is important to respect people’s time and have minimal interruptions. 5. Take the time to explain your business, recent developments and future opportunities. The key is to give information that is based on quantifiable data. For example, “we have just won a contract to supply “X” for goods of “$20,000” for the next 12 months on payment terms of “X” this will deliver a “$1,000” profit to our bottom line per month. 6. Integrity – don’t lie!! When asked about where the business is heading in the next 12 months, aim for a bellow average projection, its better to surprise your banker with a great result rather than explaining what went wrong or being to optimistic. This also builds credibility so that when you have a tight month and need to look at a temporary extension of your overdraft limit, your banker is much more likely to support your request if they know you are telling the truth. 7. Summary – Its likely that the banker will take notes, however a one page summary of your proposal for finance helps reduce errors and unnecessary questions. Its important to answer 5 main questions, who you are (background/experience) and your business (history/milestones), why you need the funds (for example purchase a premises/stock), how the loan will be repaid (contracts in place) and what if everything doesn’t work out (can assets be sold)? 8. Guided tour of your premises, even if it is an office. Introduce the banker to staff, let them see the business as it is operating on a day to day basis. This will also give the banker an opportunity to ask more questions with how the operation is run. Being able to demonstrate this visually is very powerful, as the business banker will be able to put forward your case with a better knowledge of the operation.

Next steps, ask the banker what else is involved, if they will need to contact your accountant, the time frames and expectations moving forward. Author: Mike Lark, is a business banking advisor, offering complete financial solutions. He seeks perspective, drives performance and maximises profits for small business owners. Article Key words: Financial management, small business, business banking, cash flow, financial statements, overdraft limit, credit approval, business plan, integrity, sales pitch and effective business solutions.

Seek PERSPECTIVEPERSPECTIVEPERSPECTIVEPERSPECTIVE - Drive PERFORMANCEPERFORMANCEPERFORMANCEPERFORMANCE - Maximise PROFITSPROFITSPROFITSPROFITS

Arise Business Solutions & Equipment Finance A.B.N. 81 634 607 465 Suite 1A Level 2, 802 Pacific Highway Gordon NSW 2072 Fax: 02 9844 5445 Mobile: 0421 318 274 Email: mlark@arisebizsolutions.com.au