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

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Virtual Accountant | We Have The Best Financing Available

 

Business owners shouldn’t just be applying for financing says virtual accountant. They should be applying for the most financing that they can get, on the best terms possible. This can be achieved by being very specific with the amounts that they need. For all of the different items they need money for in their business.

One mistake that business owners often make, is thinking that they have to apply for a new loan for every reason they might need money in their business. They might want to buy a building, renovate it, by some machinery, and then starts operating their business.

Rather than thinking that these are three or four different loans. Virtual accountant says business owners should write out everything that they need financially so that they can ask the financial institutions that they are applying for financing from. Exactly how much money they need for exactly what products.

This will help ensure that the bank knows exactly how much money the business owner is asking for, and what they are doing with it. The more information that they give the financial institution, the more likely they are at giving an entrepreneur the money that they are asking for.

Therefore, business owners needs to understand exactly what products they need and in what amounts. And right that amounts directly into the executive summary of their business plan.

The reason why it should be in the executive summary of their business plan says virtual accountant. Is because often the executive summary is the only part of the plan that lending agencies such as Banks and financial institutions look at.

Therefore, business owners need to ensure that not only are they putting the amount of money that they are requesting into their executive summary. But as detailed as they can be can be beneficial.

Business owners should also put in the terms that they are Desiring. Because even if the lending agency does not agree with the terms. If they do, then an entrepreneur will greatly benefit from it. And ultimately, virtual accountant says there is literally no harm in asking. And as Wayne Gretzky says, you miss 100% of the shots you don’t take.

However, business owners needs to understand that they’re not going to be able to ask for infinite amount of money. The banks are also going to look at their debt servicing capability, the success rates for businesses of their type. And what collateral a business owner can put up. So they needs to be very realistic, and employ the help of their virtual accountant. In order to come up with the right amounts for each product that they are asking for.

By asking for all of the financings upfronts, increases and entrepreneurs chances of getting everything that they need. One mistake that business owners tend to make. Is my thinking that they will have a better chance at obtaining financing later on in their business. And this is not true, because the longer and Aunt Nora is in business, the tighter their finances guess. And the bigger risk they are to the bank.

Virtual Accountant | How to Get the Best Financing Available

It is very rare that businesses start-up in Canada says virtual accountant. And don’t need any sort of financing whatsoever. Therefore, entrepreneurs needs to learn the best ways to ask their financial institution for financing. To increase their chances of getting it.

They need to ensure that they have a business plan. Because all financial institutions that are going to loan the money. Will require seeing the business plan before they approve it. A virtual accountant says that business owners also need to ensure that the first section of their business plan, which is the executive summary. Needs to have the financial information in it as well.

The reason why the executive summary needs to have the financial ask in it. Is because often, this is the only section of the business plan that financing companies, and Banks ever look at in order to make their decision on whether to loan that business owner money or not.

However, many business owners don’t even know how much money they needs to ask from their bank. And let alone understanding how much to ask in each of the different products there are, and what type of terms they should be looking for.

It can be all very overwhelming, and so business owners should talk to their virtual accountants. In order to get guidance on how much money to ask for. What products they should be getting it in. And understanding what terms are most beneficial to them.

Business owners tend to assume that the lower the interest rates are on a loan. The better it automatically is. And this assumption is actually not true says virtual accountants. While a low-interest rate is beneficial. Entrepreneurs should also consider amortization periods.

a business owner will be in a better position financially to get a loan with a 1% higher interest rate, the has a 20-year amortization. Then they are to get a loan that is 1% lower on their interest rate. But they only have an amortization of 10 years.

Business owners needs to understand that the reasoning behind this is because their finances are going to be very limited in the very beginning of their business. As they grow their company, and generate more revenue. if business owners are being expected to pay back a large amount of their loan quickly. It could cause even more financial hardship to the business, which might cause them to fail.

Therefore business owners needs to understand how to ask for the financing they need, in what amounts. In what products, and know what interest rates and amortizations they are looking for. say no to them. Virtual accountant says business owners can take the same business plan and proposal. And go to the other Banks in order to see if they’re going to be able to get the financing that they need to grow their business.

When entrepreneurs learn this, they will be significantly more successful in obtaining the financing that’s going to help them succeed. And help them avoid only applying for minimal financing. Thinking that they’re going to be able to qualify later on in their business.