- It allows a buyer to acquire a bigger and better business.
- The bank is taking on some of the risk, and
- The returns on invested capital should be outstanding.
So, in preparing for a loan, the buyer will need to write a short business plan and have a 2 to 3 year projection of the business after acquisition. This isn’t a difficult process, but will take some effort and thought. There will probably be an interview with the loan officer and maybe the bank credit underwriter. Remember interviewing for a job? This interview will be similar in that it’s not a time to be glib, rude, arrogant, or indifferent. Bankers have feelings too!
The buyer needs to show passion for the business, knowledge of the industry, and interest in growing the business. The seller will be able to educate the buyer about the details of the business and industry trends, and where to go for additional data if necessary. There are plenty of professionals that can also assist in the process and your Apex Business Advisor can steer you in the right direction.