If you are sick of working in a job you hate, and for a boss you dislike, then starting a small business can seem like an attractive idea.
Unfortunately, the majority of business ideas need funding to get off the ground, which means if you don’t have much money stashed away you could soon be saying goodbye to any dreams of being your own boss.
Not all is lost however. Luckily, there are now many different lenders who offer small business loans which means you could soon have enough money to make all of your dreams a reality.
4 Tips for success when applying for a small business loan:
What do you bring to the table?
While small business loan lenders can usually supply the majority of funding, they also like to see that you are investing some of your own money.
With this in mind, if you don’t have any money in savings, it can be a good idea to approach family and friends to see if they are interested in lending you money or investing in the business.
Work out how much you need to borrow
It’s very important to have a specific number in mind when approaching lenders. Not only that, but you will also need a detailed breakdown to support that number in order to have the best chance possible of being accepted.
For example, is there any specialized equipment that you need to buy? Stock? Employee costs? Marketing costs? These are factors which need to be taken into consideration.
Do your research
Not all small business loan lenders are created equal, which is why you need to do your research in order to give yourself the best possible chance of success.
Obviously, your first port of call should be banks and mainstream lenders, but it’s also worth looking into online lenders, especially if you are not having much luck with your applications.
Have a business plan
The number one reason why people are rejected for a small business loan is because they don’t have a business plan.
At the end of the day, just about every lender will want to see how your business intends to make money, so they can judge the likelihood of getting their money back in a timely manner.
Not only do you need to show realistic numbers and targets that can be achieved in your plan, but it also helps to clearly identify the target market for your product or service.