At the heart of
it, an SBA Business Plan is a business plan
for a bank. Yes, the SBA is involved in
the process and guarantee part or all of the loan but, at the end of the day
you are still applying for a loan.
Applying for an SBA loan is different than applying for other types of
funding. Business Plan Writers know that among
all the paperwork required for an SBA loan, the SBA Business Plan is one of the most important. Which, means it is paramount to get it right
and highlight the correct information including:
1.
Financials
Your Financial
Projections should be thorough, clearly laid out, and realistic. Keep in mind you are presenting this to a
bank. They understand numbers and
financials better than nearly anything else.
They also see enough business plans and projections to gauge how
realistic they are and how likely they are to succeed. It is important to remember that although
your financial projections are presented in totality at the end of the plan,
they should be discussed and tied in throughout. The rest of your plan is really just laying
the foundation and providing support for your financials.
2.
Cash Flow
Business plan
writers emphasize that among all the financials, showing strong cash flow
management is key. This should be a
well-considered and supported part of your SBA business plan. At the end of the day, the SBA and lender
want to know you’re going to be able to pay your loan. It’s not enough to show your expected sales and
expenses. You need to have a clear plan
for how you will manage these things, control timing, and make sure you always
have enough cash on hand to pay your loan as agreed.
3.
Ensure Repayment
Further to
demonstrating a sound cash flow plan, if necessary, offer collateral or present
cosigners. More than other types of
proposals, your personal credit and business credit will come into question. If it’s a new business, you have low personal
credit, or bad business credit, you will drastically increase your chance of
approval if you have collateral or a cosigner.
Unlike other types of funding options, you are typically personally on
the hook for business loans regardless what happens to the business. If it is likely the bank or SBA will require
additional measure to ensure you can repay the loan, offering them proactively
can go a long way to building a good relationship and being approved.
4.
Management Experience
As the world,
workforce, and traditional employment continue to evolve, it seems like more
and more people want to be entrepreneurs or work for start-ups. This is exciting and it is what the Small
Business Association is there to encourage.
However, within your SBA
Business Plan you must prove that your management can run the
business successfully and achieve the goals and projections laid out in your
plan. Maybe your only “experience” has
been running a family, and that’s okay!
Make sure to tie multiple aspects of that experience into running a business. If you feel you don’t have the skills or
experience on paper that will make a lender or the SBA feel secure in lending
you funds, find other people to act as partners or managers that do. After all, part of being a strong, successful
business owner is often knowing what you don’t know.
5.
Market Analysis &
Marketing
Especially if your
company is new, you need to prove that there is a market for your
business. Regardless the age of your
business, the SBA business plan should also very clearly, realistically,
articulate how you are going to meet your sales projections. This is one area where business plan writers
can spend a great deal of their time. Proper
market analysis leads to good marketing decisions which lead to sound financial
projections. Every section of the SBA
business plan is intimately connected but, these two supports your sales and
when done right, are key to successfully securing funding.
It’s easy to get
caught up in your own business and believe everything is important and
impressive. However, when submitting an
SBA business plan, or business plan for any other type of bank loan, Business Plan Writers will almost
always produce a better end product.
However, if you are unable to hire one, following their advice can give
you the greatest chance of success.
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