SCORE says to be able to convince a lender to make you a loan for a new business venture, you must demonstrate that you have done your homework and have prepared a business plan is what's needed to apply for a small business loan.
In addition to the primary purpose of using the plan to educate the lender about your proposed project, a plan helps you focus on the project and keeps you on track as you proceed with developing your business.
The plan should state the amount of money you will need and how much of your own funds you will be investing.
It's also very important to demonstrate how the loan will be repaid and how the funds will be used.
This can be done in the form of simple quarterly cash flow and profit and loss projections. The lender will want assurance that the loan will be repaid in a timely manner.
The plan also should contain a description of your personal business experience as well as that of the other involved individuals.
Continue Reading: "What You'll Need To Get A Startup Loan"
Photo by EyeLens.