Virtual Accountant | Business Plan Company Overview Section
It is extremely important that an entrepreneur knows what they need to put into their business plan says virtual accountant. In order to help them get their loans approved. 50% of small businesses actually end up seeking external financing. Making an effective business plan very important to get that financing approved.
However, if business owners miss important details in their business plan. And specifically, there company overview section. They might end up slow down the process. And it might take a lot longer to obtain financing.
Or, they might get rejected by their loan application. And they may not even realize that it could be due to not including vital information. In this important section.
Virtual accountant says the company overview section is so important. But it should go directly after the executive summary. The executive summary is the single most important section of the business plan. Because it summarizes all of the most important aspects of the business plan itself.
But the company overview is the next most important information. Because it tells the banker and the underwriter who is applying for the loan and specifies more information about them. A bank is not going to approve financing to a company. That they do not know who the people are, or where the business is located for example.
Therefore, business owners need to understand exactly what should put into the company overview section. So that they do not miss out on getting approved for a loan. That they could have easily qualified for says virtual accountant.
The first most important information to include in the company overview. Our who the owners of the company are. If it is a sole owner, they should include their name and all of their information. And if there are multiple owners. Names addresses contact information is needed for all of the owners. But also, what percentage of ownership each shareholder has in the corporation. So that the bank can know.
Many entrepreneurs actually do not include this information because they take knowing that information for granted. But they need to keep in mind that the business plan is designed for an external reader to view.
The next thing that a business owner should plan on putting into the company overview section. Is the legal name and the operating name of the business. Many business owners again take this information for granted. And can interchangeably use the legal aim as well as the operating name of the business.
This can result in confusion by the banker or the underwriter. So to minimize confusion. The business owner should specify very clearly names in the company overview section.
The next information should be about the business itself. And they need to put all of the company’s basic information. Such as where they are located, their address, email, and phone number. And even things like the company’s website. If they have one yet. Because the banker and underwriter are going to dive deep into verifying all of the information that is included in the business plan.
Find A Business Plan That Works Well With The Virtual Accountant
While many business owners understand how pertinent their business plan is says virtual accountant. They may pour all of their time and attention into their executive summary. Because they have heard that that is the most important section of their business plan.
However, only slightly less important is the company overview section. And if business owners do not include pertinent details in this section. They may cost themselves getting approved for the loan. That could have easily been awarded to them. If they were a bit more diligent and including all information.
While it goes without saying that a business owner should put the owner’s names, contact information, and addresses into the company overview. As well as the information specific to the business such as location, phone number, and email.
There are other aspects that are extremely important for business owners to have in the overview section. That they may not think of. For example, virtual accountant recommends specifying if they have an accountant in place already. And who that accountant is.
The reason why this is important. Is because banks see this as a risk mitigation factor. Because if an entrepreneur has an accountant. This indicates a lower risk of loaning money. Because the accountant will generally ensure that they have a more realistic business plan. That their cash flow projections will be more correct. And that they typically will have a plan in place on how to pay that money back to the bank.
Another very important piece of information that may get overlooked. Is if an entrepreneur has a lawyer says virtual accountant. Lawyers are necessary in order for the entrepreneur to complete the application. Once they are approved for the loan. Among some of the many legal documents that will need to be filled out, including security on the property as well as equipment. And personal guarantees by all of the business owners.
An entrepreneur will not be able to use the bank’s lawyers for this. So not only will they need to have a lawyer to finalize their loan application. But if they include this lawyer’s information in the company overview section. That can help speed up how quickly they can get approval. Because if the bank approves the company. They can send those documents directly to their lawyer to help finalize the process.
It is very common for entrepreneurs to use their investments as security. And if this is the case. The entrepreneur should include that advisor’s contact information in the company overview section. This is true even if the advisor is within a different branch of the same bank. The underwriter is typically going to need to verify those investments. And so making it as easy as possible will help speed up the process.
The easier a business owner is going to make it for the banker or the underwriter to verify the information. The faster they are going to be able to approve the loan. It is important to not miss any important information. Especially because granting a business loan can take a significant amount of time. And an entrepreneur should do everything that they can to avoid slowing down that already lengthy process.