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E-Myth – “Why most small businesses don’t work & what to do about it”

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Virtual Accountant | If Financing Is Required, Call Us!

 

Most businesses are going to need financing to start their business as a virtual accountant. And even if they don’t need a lot of financing. Even if they need a credit card. That should that they needs to start their business.

And any entrepreneur that’s applying for financing should have a well-written and well-thought-out business plan. And the most important aspect of the business plan for obtaining financing is the executive summary.

The reason why the executive summary is the most important part of the business plan. When an entrepreneur is obtaining financing. Is because it’s often the only part that’s a financial company whether it’s a bank, lending institution or high-level investor Reeds. When they are making the decision to loan money to that business owner.

Therefore, business owners not only needs to have a business plan. But they also need to have a very well-written executive summary. So that whoever is making the financial decision on whether to loan money to a business owner. They will be able to see exactly what the entrepreneur is requesting.

Business owners should not make the mistake of only applying for one type of financing initially in their business. Virtual accountant says this can be astrology gone wrong for a lot of business owners. Who think that they’re going to be able to obtain more financing very easily. Once they’ve owned their business for a few years.

The reason why this is not true says virtual accountant. Is because as entrepreneurs grow their business, the longer they are open, the more their business will fall to a cash crunch. This cash crunch makes them risk for lending companies and Banks. Who will be less likely to loan money to an entrepreneur? The more years that they’ve been in business.

Therefore, it’s a much better strategy for an entrepreneur to think about all of their financial needs, even if they have several different requirements. And putting them all together in one ask from the bank.

Business owners will be more likely to obtain financing, even if it’s for a much larger amount of money than what they initially were asking for. As long as they are specifying exactly what they plan on doing with the money, and what products they are looking for.

Virtual accountant says business owners can even get as laser specific as asking for the specific interest rates they want as well as amortization periods they are looking for. They may not get those specific terms or amortizations. But if they don’t ask, they probably won’t get those terms or amortization periods they requested either.

They can go to other Banks, with the same proposal to see if they can get better financing elsewhere. By realizing that they can shop this proposal out to as many banks as they want. Can give entrepreneurs the power they needs to understand it’s okay to ask for what they want. And then take the best offer that they receive.

Virtual Accountant | Financing Required

Business owners needs to understand that asking for financing from a bank or a financial institution is more than just asking for a specific amount of money says virtual accountant. Ideally, business owners will ask for all of the money that they need for all of the different aspects that they need money for in their business.

By specifying out exactly each project that they needs to fund, piece of equipment they need to buy, and how much they want for each project. They will be far more likely to receive that amount of financing in those products.

If a business owner simply was to ask for one lump sum, and not specify anything else. Virtual accountant says that the risk business owners face, is getting approved for the financing. But not in the products that they need. And not in the terms that is most beneficial to them.

Therefore a business owner should learn what products they’re going to need from a bank. And how much money for each product they should be asking for. Virtual accountant says this can help an entrepreneur understand exactly what their financing request should be. So that they can be more likely to get approval for their business.

Mortgages are the products that banks will offer if an entrepreneur is purchasing land, or a building. They come up with their own interest and amortization. And typically, a bank will need to know a lot of specific information about the land and a boat the building before they will loan the money.

The second type of products that business owners need to be familiar with our term loans. And these are specifically for assets that a business owner would be purchasing for their business. Or for things like leasehold improvements.

Business owners will also most likely require a credit card and their business. For paying suppliers, and giving their credit card number on file to be able to order from companies. Virtual accountant says the limit on the credit card is going to depend greatly on a number of factors including what type of business the entrepreneur has. And what announce they are planning on putting on the credit card.

Finally, virtual accountant says business owners also needs to be aware of line of credit financing. This is by far the most beneficial product. But also the hardest to obtain says virtual accountant. It’s most sought-after. Because typically, entrepreneurs do not have to pay the principal of the line of credit, they will only have to pay the interest. And when entrepreneurs are short on money in their business. This can be extremely beneficial to them.

Business owners also needs to keep in mind that if they don’t get a yes from their bank. And they won’t loan them either entire amount of money that they want, they won’t give them all of the products that they need. Or even if they don’t get the interest rates or amortization that they were Desiring. They don’t have to accept the banks next offer for their business.

In order for business owners to succeed, virtual accountant says they must be able to ask for what they want, and then keep on asking and till they get the answer that they want. The ability to grow their business will literally depend on business owners doing this.