Cosmetics Retailer Business Loan
How to Prepare a Cosmetics Retailer Business Loan Request
Most owners of small Cosmetics Retailer Businesses believe that banks only lend money to companies that don't need it. This is not true.
However, what is true is that bankers and the banks they represent will not typically make an effort to understand a Cosmetics Retailer Business when an owner has not made a concerted effort to explain, in an organized and concise manner in their Cosmetics Retailer Business Plan:
- The company's business.
- What it will do with the money it wants to borrow.
- How it intends to repay any borrowed funds.
The following hints will help any Cosmetics Retailer Business owner ensure that a banker sees their Cosmetics Retailer Business in the best possible light.
Rule #1 For The Banker: "Know Your Customer"
The first rule of every banker is "Know your customer." This means that before a bank can make a loan, the bank must have an in-depth understanding of the Cosmetics Retailer Business, including its history, its future, its products, its customers, its suppliers and its owners. The company's Cosmetics Retailer Business Plan must include these topics.
For smaller businesses, the bank will rarely distinguish between a company and its owner. This means that the bank will want to understand the personal financial circumstances of the owner, including the details of the owner's net worth and cash flow, just as the bank needs to understand the finances of the Cosmetics Retailer Business.
Your Cosmetics Retailer Business Plan is as much about you as it is about your business - they will be the same thing!
The bank will also want to understand the owner's character. The bank will want to examine the owner's personal credit history on the premise that the owner will manage the company's debt similar to the way he manages his personal debt. Also, personal guarantees will always be required. A bank will never consider taking on the risk of lending money to a small business whose owner will not accept the same risk.
Helpful Cosmetics Retailer Business Plan Tips
Following are some helpful tips to make a loan request package stand above the crowd:
- The Cosmetics Retailer Business Plan must be well organized.
- The Cosmetics Retailer Business Plan must be complete. Requesting additional information is time consuming for both the bank and borrower.
- Your Cosmetics Retailer Business Plan must make it easy for the bank to understand the business.
- Carefully explain how the borrowed funds will be used.
- Carefully explain and document how the funds will be repaid.
- Any required forms should be neatly and completely filled out.
- Be prepared to offer the bank a lien on all of the company's assets.
Bankers Also Need To Know
To ensure that you help make the bankers life easier, consider including the following supporting documents in your loan request:
- 2-3 years company financial statements. Ensure they tie in to your bank account activity!
- 2-3 years company tax returns.
- Latest accounts receivable ageing (if applicable).
- Latest accounts payable ageing.
- List of 5-10 largest customers. Indicate each customer's percent of total sales if over 5%. Not applicable to retail businesses like restaurants or shops.
- Personal financial statement of owner(s).
- 2-3 years personal tax returns of owner(s).
In Conclusion...
The business plan is the company's plan for the future. The bank will want to know if the company intends to grow and how it will achieve its growth objectives. The bank will want to know how the company will compete. The bank will want to know how the company will function in bad times. Who will manage the business in the event of death or illness? Be prepared with the answers to the banker's most likely questions and you have increased your chances of raising banking financing.
Contact us for a Cosmetics Retailer Business loan
Further Business resources:
In order to offer the most exciting range of business plan options on the internet for you we have partnered with the following sites:-
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A2Z Business Plans providing a general Cosmetics Retailer Business Plan. The plan contains information that can be used for any business location in the world. |
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US Business Plans provides a Cosmetics Retailer Business Plan written exclusively for the U.S. market. The plan contains specific information for the U.S. and is the most comprehensive U.S. plan available on the internet. |
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UK Business Plans provide a Cosmetics Retailer Business Plan written specifically for the U.K. market. The plan contains real information for the U.K. and is the most complete U.K. plan available on the internet. |
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Business Plans 4 You will help with completing your Cosmetics Retailer Business Plan. They provide our plan and then work with you to produce the business plan you need in a few days. |
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