NEW VENTURE GUIDE

by the UALR Arkansas Small Business Development Center

The Loan Proposal

Lenders somestimes ask for a business plan when you talk with them about a loan for your business. The business plan that you develop as your management and operating guide contains more details than a banker has time to read. The plan, after all, is for your use and helps you stay on track toward the goals you have established for the business. The list below represents the key sections of your plan that address the management, market, and money elements of your proposed business. In evaluating your request for a loan, bankers particularly want the information noted below.

Suggested Contents

1. General Information

• Purpose of the loan

• Expected benefits of the loan

• Amount of money required, including a source and use of all funds in the project

• Sources of repayment

• Desired repayment terms

• List of available collateral, including market values

2. Description of Business

• Explanation of planned activities, or history information for existing businesses

• Planned changes to business operations, if any

3. Management Information

• Personal resume, including a description of any prior management or ownership experience

• Key staff, including description of their roles in the business (provide resumes)

• Other key advisors e.g., attorney, accountant, insurance agent

4. Market Information

• Products/services provided

• List of competitors, suppliers and clients/customers

• Define market area and method of distribution

5. Financial Information

• Balance sheets and income statements (three year-end statements and interim for current year if existing business)

• Federal tax returns (past three years)

• Projected income statement (minimum of twelve months into future)

• Projected cash budget (for same time period as projected income statement)

• Summary of key assumptions explaining basis of projections

• Personal financial statement

The Arkansas Small Business Development Center is funded in part through a cooperative agreement with the U.S. Small Business Administration through a partnership with the University of Arkansas at Little Rock College of Business and other institutions of higher education. All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA. It is the goal of UALR to eliminate discriminatory harassment and to promote equal opportunity regardless of race, gender, color, national origin, sexual orientation, age, religion, veteran’s status, or disability.