SEEKING A LOAN:
Before you present your case for a loan think about the needs of the lender.
Lenders need security so aim to persuade them their money will be safe and adequately secured if they lend it to you.
Many new businesses fail because they are under-capitalised or over optimistic. Plan your strategy before you seek a loan.
Five of the best tips when presenting a case to borrow money
* Collect some facts first
Produce evidence of a demand.
Carry out market surveys to collect facts showing there is a need and a demand for your product or service.
* Prepare a sound business plan
The business plan will help you analyse the project and clarify your ideas.
Your written plan should support your case for borrowing money and show you have budgeted for all contingencies.
Your plan must show you have a good grasp of financial matters , that you have considered all factors, making best and worst case scenarios or assumptions and there is a good chance of a profit if the plan goes ahead.
* Show you have support
Get supporting statements from professionals. Get letters from your accountant, lawyer and any other highly regarded associate to support your case.
* Be professional in your approach
Present yourself looking well groomed, confident and full of enthusiasm.
Answer questions honestly, clearly and succinctly.
* Show you have a good reputation
Produce evidence to show you are a hard worker and a good payer of services and loans.
Lenders will usually check out your work history, your internet history and your ability to perform and pay previous loans on time.
Never forget it takes many years to build a good reputation and only one bad mistake to lose it. So take care.
“The important thing is what the lender wants to know, not what you want to tell them.”
Source: “Persuasive Way. Tricks of the trade to get your ideas across” Moss Associates Ltd. “Secrets of Persuasion” Cengage Learning Asia, “Persuasive Ways” (Simple Mandarin) Shanghai People’s Publishing House. Also available as an e-book from Amazon.com