PeachParts Mercedes-Benz Forum - Successful business plan

Quote:

Originally Posted by whunter (Post 2371734)

Yes, a business plan is important. Most businesses fail because they don't have a practical one and a means of generating cash. But the plans shown here are mostly academic. If you want to get a good business plan, ask any bank that makes loans to small business to give you a list of their requirements for a small business.

The reason I'm suggesting this, despite Roy's extremely helpful stuff, is this:

No business is meaner, crueler greedier or more pragmatic and practical than a bank. If you request a loan, they look at your business plan to verify that the business owner has listed every conceivable way to make money out of the enterprise. So...if you have a pretty complete business plan, they are like the snotty teacher who has to find something to pick on, to show that they are smarter than you.

And in one way, they are: they come up with more ways to separate you from your money than almost anyone else!

So the way to put them to work for you is this:

1. Pretend that you plan on getting a loan or a line of credit of $25,000 or more.
2. Put together your business plan and show it to them as a part of the line of credit application. They will want to see it anyway.

3. They will go to great lengths to find all the shortcomings of your plan. Let them, it's free consulting by experts in screwing people!

4. After they refuse you for all these reasons, fix your plan, wait a month and go to a new bank with the same, but now revised, plan. Increase the credit line.

5. After they review it at the second bank, you will either have a very good plan that doesn't need their financing or you will have a good plan that can use their financing as back-up.

6. Most banks will lend you money as long as you don't plan to spend it. That sounds strange, but it has to do with following Federal regs, but still having the money available to invest. So you design your plan to use the credit line as an emergency back-up, i.e. to keep the lights on and the taxes paid.

7. Use the line of credit as your mattress fund, not your gift card.

8. If they refuse you, you still have a better business plan than when you started.

9. And all it cost was the effort to do what you were going to do anyway.

Good luck!!!