Small Business Financing Becoming Increasingly Difficult to Attain
Posted by: Chris on: 13 Aug, 2009
According to a recent USA Today poll, nearly 40% of small business owners polled state that they have been unable to secure the financing they need for their businesses. This is happening despite the fact that the U.S. Small Business Administration has lightened its requirements for lenders to approve small business loans.
According to a recent USA Today article “A report from the Service Employees International Union, also out Wednesday, says SBA lending by major banks has significantly dried up. Bank of America, for instance, made a mere $10 million in 7(a) loans for the first seven months of fiscal year 2009. For the past two full years, it made $102 million and $336 million in 7(a) loans, according to the SEIU.
Today’s reports are gloomy, but there are bright spots on the lending front. From Feb. 17 to July 10, more than 700 lenders that had not made a 7(a) loan since October 2008 made such loans, according to the SBA.”
In order to put your best foot forward with an attempt to secure capital for your small food business, or start-up food business, it is imperative to have a comprehensive formal business plan in writing to present to lenders and/or potential investors. Having a formalized business plan complete with an operational cost analysis, break-even analysis, projected future earnings statement, etc. is crucial to presenting a lender or investor with a complete picture of your current situation and a road map to your future success. More importantly, it tells the lender or investor when they can expect a return on their investment in your business.
If you need help with putting together a formal business plan for your food business, please contact us today. Gourmet Business Solutions specializes in helping gourmet and specialty food companies launch and grow their businesses.
