Whether you’re just starting out and need some manufacturing equipment or ready for a much needed upgrade, SBA manufacturing loans are certainly something you should consider. Qualifying companies in the manufacturing industry are able to benefit from loans from the U.S. Small Business Administration. Although the requirements are strict, the advantages of these loans make them worthwhile. Here are some tips on how to obtain manufacturing loans.
Be Specific in Your Request
When you apply for a SBA manufacturing loan, tell the banker the exact amount of money you need and what you intend to use it for. Break down your expense analysis into specifics. For instance, if you intend to use the funding to grow your business, delineate how much you intend to spend on equipment, marketing, employee salaries, and so on. If possible, back up your figures with documented research.
Prepare Financial Documentation
To facilitate the application process, prepare copies of your bank statements, financial statements, and tax returns. Ask your lender if it is permissible to provide digital copies of these documents.
Provide Your Credit Score and Credit History
Although the bank will run its own check, find out the details of your credit score and credit history and share these with your lender. This gives you the opportunity to discuss any details in the report that might hinder your qualifying for a manufacturing loan.
Present Details about Company Management
Provide lenders with details about the owners and managers of your business. This should include resumes and job descriptions. If you have yet to fill certain positions, describe the type of person you are looking for to fill the vacancy.
Share Your Projections
To convince the lender that your business is sound, demonstrate the future growth of your company through an analysis of the desirability of your products and services and your current figures for sales and expenses. Specifically, explain how the loan will spur further growth.
Offer Collateral
To obtain your SBA loan, you will have to offer collateral to secure it. This may include your home or your business assets.
Answer Questions
After you have explained the details of your business and submitted your documentation, be prepared to answer further questions. When you have finished your presentation, be patient while the lender considers your application.
For more advice on how the manufacturing industry can obtain SBA manufacturing loans, contact Aspen Commercial Lending.
The SBA is not as scary as it may seem, and can be a great way to get your business off the ground. They can also be useful in helping you acquire an existing business. This is a great way to bypass the startup phase of your new business. If you are considering buying a business, here is a book we recommend on how to do it better.
