Investments

Sooner or later, most business owners need to look for outside financing. Whether it's a line of credit with a bank to handle predictable cash crunches or a significant capital investment to improve plant and equipment, virtually every business will need access to additional funds at some point in its life.

Bank Of America Investment But the time to start thinking about how to make the best impression with bankers and private investors ideally begins long before you schedule an appointment to discuss your financing needs. In fact, the best preparation you can undertake to get the financing your business requires is the very same work that you should be doing to ensure that your business is financially sound in the first place. Business owners that can consistently demonstrate their ability to effectively plan the future of their company will stand out in the crowd of more haphazard entrepreneurs.

Remember, a good financial planner should help you get a clear picture of your financial situation and lay the foundation for future investment decisions. Beware of planners who offer few or no alternatives in your investment plan, which may indicate the planner's intent to steer you into a fraudulent scheme or sell a specific product for the commission. Similarly, pressure sales tactics or promise unusually high rates of return on investments. Be on guard for possible Ponzi schemes that can masquerade as tax shelters, precious metals, commodities, tech stocks, and other investment vehicles.

Investment Opportunity Here are several things that you can do now to ensure that your search for outside financing will be successful:

3. Subscriber agrees, as a condition to continued receipt of IBD Alerts Plus and its Content, Subscriber shall not create, sponsor or permit the trading on its exchange facilities, if any, of financial instruments or investment products (including, without limitation, derivatives, structured products, investment funds, traded funds (e.g., options on ETFs or futures on ETFs)) where the price, or performance of such instrument or product is based on, related to, or intended to track, any index published by Dow Jones or financial instrument or investment product (e.g., traded fund) linked to an index published by Dow Jones, without a separate written agreement with Dow Jones for such purpose.

Banc Of America Investment Determine Realistic Rates Of Growth: Unless you're the next Amazon or eBay, "pie-in-the-sky" projections about how quickly your revenues will grow will usually be seen as so much wishful thinking. Effective financial planning requires you to develop your business around realistic growth rates. Otherwise, you'll wind up in the hole before you even begin.

Your business financial statements are usually the most heavily weighted item when a surety underwrites a bond. There are a number of things you can do when preparing your year end business financial statement to make it the most attractive to a surety company. For one thing, utilizing the services of a Certified Public Accountant will give your financials more credibility ( house financials are accepted for smaller bond amounts, but may not get you the lowest rate). Often, the figures on your balance sheet are only as strong as the individual that prepares them. You want a very clean and clear presentation of your business and its financial picture. Bonding companies prefer statements prepared on an accrual basis, with full notes and disclosures. The accrual method gives the underwriter the best picture of your companys financial strength.

Banking Investment Develop Pro-Forma P&L's, Cash Flow Reports: Once you have estimated what your revenue picture will look like, you can more accurately predict what your financing requirements will be. Put together projected profit and loss statements and cash flow estimates so that you know exactly how much financing you'll need and when you'll need it.

• Includes all the features of Quicken Deluxe, plus powerful investing tools to help you plan for your financial future and grow your investments • - bring all your online accounts together in one place • Connect to your bank, credit card, 401(k)s, or brokerage accounts with a single password • Smart investment tools help you research, balance your portfolio and monitor your net worth

Investment Solution Strategic Write Your Business Plan: Contrary to popular opinion, written business plans are not just for those who are looking for venture money. A well-written business plan can be an effective planning and management tool for every business. Often, the very act of writing about your business forces you to think through complex strategic issues, reevaluate your critical business assumptions and identify other areas where careful analysis will strengthen your chances of success.

Second, qualify for your loan. Your lender should spend time finding the right loan that fits you and your investment. Be prepared to provide information about your loan request and investment. For example, if you are looking for an apartment loan, you will need to provide information or descriptions about borrower (you) and financial information, the financing request, location information, property information and issues, and tenant information.

Investment Banking Services Revise, Revise, Revise: Take a look at your plan and your projections at least once a year, and revise them according to actual results. If your performance falls short of your expectations, analyze why you failed, implement the necessary changes in your business strategy and adjust your projections to more realistically forecast future results. Likewise, if you were too conservative in your projections, don't be afraid to scale up your targets.

Bank Investment Keep Your Finance Contacts In The Loop: A good relationship with a banker or outside investor should be developed over time, not simply when you have the need. Keep your financing contacts up-to-date with what's going on in your business by providing regular financial reports and by meeting with them periodically to apprise them of how things are going. The more knowledgeable they are about your business, the more comfortable they'll be in providing you with the help that you need when you need it.

Alternative Investment
William von Achen is president of Strategic Management Resources, an executive coaching and management consulting firm offering advice and counsel to business owners and senior executives. For more information visit our web site at www.smrweb.com.

[ Comment, Edit or Article Submission ]