You’ve just started your own business. Congratulations! It’s an exciting time, but it’s also a lot of hard work. There are so many things to do and so much to learn. For example, one of the most important things you need to do is get a loan from the bank to help finance your business. But how do you go about getting that loan? The first step is to write a business plan or proposal with which to convince the bank that your business is viable and that you will be able to repay the loan.
Here are some tips for writing a convincing one.
Pick a Compatible Lender
Different lenders prioritize different lendees. Some lenders prefer to lend to memory care facilities due to factors like low risk and high demand. Others are more interested in funding startup businesses because they offer more potential for growth.
Consider what kind of lender is most likely to fund your business before you even start writing your proposal.
To find out this type of information, you can:
- Call the bank and ask to speak to a loan officer.
- Research the bank’s website or annual report.
- Ask around – talk to other business owners and see who they went through for their loans.
Do Your Research
Once you’ve found a few compatible lenders, it’s time to do your research. This step is crucial and will take some time, but it’s worth it. You need to know everything about your industry, your competition, and your target market. The more you know, the better equipped you’ll be to write a convincing proposal.
To do your research, you can:
- Read trade publications.
- Go to industry conferences.
- Talk to other business owners in your industry.
- Do a SWOT analysis of your business (strengths, weaknesses, opportunities, and threats) to identify any potential risks associated in order to come up with strategies to mitigate those risks.
Write a Compelling Executive Summary
The executive summary is arguably the most important part of your proposal. This is where you need to convince the lender that your business is worth funding. You need to make a strong case for why your business is a good investment.
Be sure to include:
- The problem your business solves.
- Your target market.
- Your unique selling proposition (what makes your business different from your competition).
- Your marketing and sales strategy.
- Your financial projections for the next few years.
If you can convince the lender in your executive summary that your business is a good investment, they’ll be more likely to read the rest of your proposal.
These are just a few tips for writing a business loan proposal. If you take the time to do your research and write a compelling executive summary, you’ll be more likely to get the funding you need to grow your business.