The next thing will help to understand the steps that need to be taken in order to raise more money from the bank, it is simply a matter of knowing to do it right.
Whether you need to get a business loan? Or is there a cash flow problem? Or do you even want to develop your business?
Here’s an example of how we do it, when you hear how we raised NIS 250,000 for my father , even though he was in debt, you will understand how you can do it yourself:
My father turned to me and said that after many years as an employee he opened a business in 2013 in the field of importing and exporting storage solutions and a private garden office.
At first the business progressed fine, it went really well and its growth rate was about 50% per year. It was almost profitable from the start, but it came to me with a cash flow crisis that slowed its development.
How does a successful business come to the problem of cash flow?
So what did we do to solve the problem?
We immediately began to connect to the numbers:
– We analyzed the fixed expenses,
– the debt to banks and monthly repayment,
– the owner’s withdrawals to the current living,
– the types of products and the profit on each and every one of them.
My father came out with a budget and cash flow arranged for a year .
Think of the quiet it gives .. Pleasure.
Anyway now it just goes and becomes better!
Next we went to the bank and raised the first 70,000 shekels just to inject oxygen into the business to move the import and replenish inventories.
We prepared the bank in advance and said that this is an intermediate stage and that we will have to finish the plan
Probably another loan. After the meeting at the bank, I asked my father to tell me what cash flow was expected for the overseas purchases he needed so that he could supply the goods the market was asking for.
You may be surprised to hear that my father has put conservative estimates on time, he was afraid to ask for money from the bank, and he was used to taking a little time and making do with that.
I reminded him that if we put real numbers on the program after we’ve connected numbers to the business,
There is no reason to ask the bank for less money than what is raised in the plan, because this money is intended to generate more profit and it is clear to us exactly what we will do with it.
Justice: “The money is swallowed up in my business” or “I do not understand where the money is?” Do not exist in such a situation,
Now that the plan is in order, we have arranged a meeting with the branch manager, and we presented the budget and expected cash flow, and asked for NIS 250,000 for the program.
The branch manager explained to us that the customer’s debt is high before the additional loan, but she fully understands the situation and promises an answer within 48 hours.
And what happened in the end?
On the way, we received the following day that all the loan application had been approved and the customer had received a loan of NIS 250,000 for 4 years
Why did we manage to raise the loan we wanted?
Because we spoke to the bank a language called bank, a language that most small business owners do not talk to.
This means that the bank will be presented with budget plans and an expected cash flow that make it feel safe and flexible with the business owner.
Of course should also explain and talk with the banker, but the basis for this dialogue, these are economic reports.
So if you also want to know how much money you need to earn more and be able to raise it.