Business Credit

The business loan plan what banks pay attention

The career of the young founder begins with a challenge: he has to master the transition to the bank. In credit negotiations, there is no way around the business plan. This plan can be decisive for the future of the founders, as it decides on the granting of a loan.

What should be considered when creating the business plan? Which beginners mistakes are easy to avoid?

The following text will examine the issues that are particularly important to lenders. 

What is a business plan?
Sure, the words business and plan say a lot about the meaning. For founders, the business plan is a kind of personal manual. It should serve as a personal guide that describes the path to success. But the banks define this term a little differently.

Business plan tips | Image: © Jorma Bork / They see the business plan as a business card of the newly founded company, it serves as a basis for granting future loans. The plan contains a list of tasks that, if fulfilled, signify entrepreneurial success.

Thus, the business plan serves as a navigation aid for all persons involved. He also proves the business knowledge of the young founder.

The Federal Ministry of Economics and Technology recommends asking the business plan the following questions. Only if he can answer all, he has chances to get the green light:

– Why do you have to be in the leading position?
– What is your product or service offer?
– Can you assess your customers and their competitors?
– Opportunities and risks: How do you rate these points?
– What is your marketing strategy?
– How did you plan financing in the different phases?
– What capital requirements do you consider realistic?

Anyone who is still unsure when creating the business plan, can in many places (from free information articles to professional consultants) inform. Free tips and Excel templates , for example, the software manufacturer Lexware available.

What do lenders pay attention to?
The bank is little interested in the dreams of the young founder. She wants to see concrete figures and an attractive business model. In a sense, every business plan is about a factual vision of the future. But some visions are better calculated than others.

The bank invests in the visions where the calculation promises future profits. Therefore, the main focus should be on cost and sales planning. For a bank, the processing of business plans is part of the everyday craft.

It recognizes obvious mistakes immediately and negates them to the founder. A business plan not only consists of concrete numbers, but also includes a formulation part. This should be in accordance with the calculations.

The auditor pays attention to the plausibility of the arguments provided, as they show how well the founder is familiar with the product and the competitive situation. This requires a realistic assessment.

The formulation should be made in a factual tone, emotions and feelings have lost nothing here. The business plan should sound objective and realistic. Statistics are always good if they are directly related to starting a business.

Imagine a service that should be passed on to rich customers. Anyone who can present a reliable statistics on the purchasing power of the target area, collects many pluses.

The most common rookie mistakes
Most of the time the founder is not an expert in business administration. Consequently, avoidable mistakes happen. Experts see the main mistake in the realistic assessment. Often, in the formulation part statements are made that are not reflected in the numbers.

Especially the calculation offers many sources of error. The more detailed, the better.

The lender needs to be able to understand what expenses are incurred. He has to see how his money should be used. The bank may even have a better tip, such as using a leasing offer or using alternative financing.

Young founders afford many calculation errors, for example in personnel costs. For example, employers’ contributions to social security contributions are simply left out. This also applies to seasonal fluctuations. These gross mistakes play an important role in sales planning.

Another mistake is often criticized by lenders: Many founders give the VAT in sales planning wrong. There, it is to be stated as a non-continuous item, whereas in liquidity planning this is the case.

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