Obtaining credit from a commercial bank, especially for the first time, can be an important moment for any entrepreneur. Think about the meeting with your banker as an opportunity to add a new business partner.

Banks have a vested interest in lending money. Financing commerce helps create jobs and other economic activity in South Jersey. Banks with experience lending to small business are well prepared to understand your business idea and build a productive relationship with you.

If you focus on certain areas, including your business plan, the experience and credit of the people involved in the business, and the feasibility of the business being successful, then you can improve your chances of getting financing. Here are a few things to keep in mind when preparing to meet with your banker.

Business plan:

An effective business plan should include the amount of debt needed, details of how each dollar will be spent and how the loan will help the small business achieve business goals. Highlight how much equity the owners have contributed. Applicants should also include detailed financial statements, for a minimum of two years if possible, and projections explaining how the business's profitability will generate cash to pay back the loan. Explain in detail the gross margin and all of your financial assumptions. How do the ratios compare to your industry? Do you have evidence your customers will buy your product or service at your price?

People:

Lenders will evaluate the quality and reputation of you and your management team. A good personal credit score is essential to a small-business owner, because it affects the borrowing ability of the business and can be used by the lender in the underwriting process. Highlight the experience of your team with resumes, references, organizational charts, and other details giving the lender a strong view of your team's personal and professional accomplishments.

Feasibility:

Lenders appreciate receiving applications that have been reviewed by experienced business advisors. Loan applicants can turn to a trusted CPA or commercial attorney, or utilize any of the area's small-business advisors. Your accountant, insurance agent, attorney, and lender must work together to ensure that you achieve your business goals.

If you're looking to learn more about financing options for small businesses, our partners at the U.S. Small Business Administration have a lot of technical assistance available at their district offices and through their Web site at www.sba.gov.