Top tips on how to secure financing

Cash Friday Content

Raising finance has been much more of an issue in the current downturn than in previous ones, so to secure funding it is important that the following basic requirements are met:

  1. Present a sensible business plan - one that is based on realistic numbers. It is often better to present a lower level of turnover and a conservative view on costs. Financiers will tend to look more favourably on figures that are easily explained and are not turnover led, but if turnover growth is likely then work it into the projections. 
  2. Talk to your funder on a regular basis, even if the news is not good; nasty surprises do not go down well. 
  3.  Work with your accountant on presenting the numbers. They may also have other funders that they maybe able to introduce you to. If they have reviewed your numbers it will also help your case.
  4. Consider all your options for the types of funding available. The traditional overdraft and loan is not always the best option, for example you should also consider Invoice Financing.
  5. Try and get your financier to visit your premises, and show them around so that they can see the business first hand. Make sure the visit has a structure and agenda.
  6. Ask for the amount of funding you feel you need, not what you feel your funder will sanction. You might be surprised by the reaction as funders are under pressure to lend more, and for the right business they will, but be realistic in your requests.
  7. Consider giving a guarantee to support the funding. It does not have to be supported by personal assets but does need to show personal commitment to the business. 
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