As a business owner applying for a funding for your business can be a cumbersome process and can be very hard to get. For those in the restaurant business it might be next to impossible to get one. Restaurants unfortunately have the infamous reputation of having the most highest failure rate when it comes to business which is why some banks and financial institutions won’t lend them at all. As a restaurant owner your only lending options are the U.S Small Business Administration, crowdfunding, private investment and online small business funding. While you take the time to ponder which options best suits you there are other decisions that you can make to help improve your chances of being approved for funding. Below are five ways you can increase your odds of getting your business funding.
1.) Getting All Your Documents Prepared: Funding from the SBA take awhile to get approved but having the necessary paperwork already prepared can change how long it takes before you can get it. According to Marlow Schindler, a lender relations specialist at the San Francisco SBA district office the length of the application process can change “if you have the correct paperwork ready when you apply, you can get funded in a few weeks.” To qualify you must have your personal and business income taxes, financial statements and other legal documents verifying your business.
2.) Assess Whether Or Not Crowdfunding Is Right For You: Crowdfunding that offers rewards is a great choice for businesses with a large social media following and an extensive contact list. This of course maybe a cost ineffective option because of the cost for prizes and if you’re using a popular crowd source website like Kickstarter you would have to pay them 5% of what ever you received. In the end some people may find the amount they’ve raised altogether not worth the effort they’ve put in but it still a viable option.
3.) Refer To Family And Friends: You can get help from those close to you if you want to practice how to talk to lenders and investors about your business. Family and friends are the perfect people to talk to if you want some feedback as they ask you questions about your business so you can feel more prepared talking to investors or lenders. Lenders would prefer to lend to people who possess considerable knowledge about their business or industry. Mike Harden co-founder of Artis Ventures a venture capital firm in San Francisco can tell if it’s worth his time meeting with entrepreneurs judging from their email message as he looks for those who knows their business inside and out and can tell because they have “a certain authenticity.”
4.) Avoid A Nondisclosure Agreement: Naturally if you’re starting a business you would like to keep your plans and ideas a secret from others which may sound smart but can actually be limit what your business can be capable of. What happens is many entrepreneurs sign nondisclosure agreements before their restaurants open but they may end up missing out on valuable insight and advice from people who can help them improve their plans and put it into action. This may come off as a sign that you’re not willing to put in the effort to make changes to to some people because you refuse to be open to finding ways to make your plans better and work on them
5.) Get 2nd Opinions About Your Business Plan: As a continuation from the previous tip have someone to critic your business plans whether it be your accountant, attorney or other restaurant owners. Having professionals review your business plan helps you get their valuable opinions on what you can tweak or remove and its never a bad idea to use the business plans from other successful establishments. Having all of this in mind you could be more ready the day you decide to apply for funding for your business and not be nervous or unprepared for any questions or paperwork you need to bring.
This article was sourced from and rewritten from -https://www.nerdwallet.com/blog/small-business/insider-tips-for-funding-yourstaurant/