Small business start-up loan advice

SarahLou

I've just popped a post on the Small Biz board but have saved these questions for this board as they're loan/bank related.

I'm nearing the stage where I'll be approaching the bank manager to ask for a loan to start up a pet shop. I have my business plan and my cash flowchart sorted and my business advisor from Be-Enterprising has been looking over all of it (and has given it the "nod of approval"!)

My questions are:

1) General hints/tips - I've never met with a bank manager before for any purpose, let alone asking them for money - any hints/tips greatly appreciated!

2) Whats my options if they say they'll only give me a loan if I secure the house against it? (Something I'm not keen on doing being a new business start up - I wouldn't want to lose our family home!)

3) What other things (other than my business plan and flow chart) should I take with me to the meeting?

4) What are peoples thoughts on going to a bank you have your current account with versus another bank? (I've had pros and cons from my business advisor but wanted to hear others opinions).

5) Finally, how quickly are decisions normally made?

somethingcorporate

How much are you personally putting into the business?

It's going to largely be about risk for the bank. If you are risking nothing and they are risking everything you are not going to get very far.

Well established businesses that I worked with recently with turnover circa £2m+ struggled to get loans from the bank without backing them with substantial assets, I would expect this to be par for the course for a complete start-up.

SarahLou

Hi there,

Very true indeed. My business advisor has suggested 1/4 to 1/3 should be sufficient - as such, my parents are loaning me just short of 1/4 of what I'm asking for in total. I'm hoping that will be enough.

CLAPTON

well, if you are not confident in your business plan to be willing to secure the debt on your house when why would a bank be confident in your business plan?