Small Business Finance Borrowing Plan. Where to Start

Business Loans
  • Small business funding is among the most crucial questions for the successful operations of a business, especially startups.
  • If you decided on finance borrowing strategy, you definitely need a thorough financial plan considering all points and possibilities.
  • Read more if you want to find out how to put together an effective financial plan for finance borrowing to grow your small business.

small business finance borrowing plan

Once you have established a finance borrowing strategy, the next step is to put together an implementation plan of your small business funding. The financial plan is based primarily on the business plan and associated cashflow projections.

As said, the process of putting the financial plan together starts with going through your business plan and cashflow projections. First, you have to identify points in time where there might me additional capital requirements. Bear in mind that they may not correspond with negative cashflow points. For example: as a result of expected revenue growth, additional equipment is required with the lead time to get it installed, and operational could have additional capital requirements months earlier.

Some of the other points to consider:

  • The requirement for additional or casual staff
  • Larger inventories supplies/ raw materials / finished goods
  • Larger or additional premises 
  • Additional system hardware & software
  • Increasing sales & marketing expense to achieve growth

As I mentioned before, the tendency is to use any available cash on hand or existing finance facilities to meet the additional costs. The trap is when all existing resources are tapped out. It will be more expensive and harder to get the more specialised finance options approved and in place.

The next phase in the planning process is to match off the additional small business funding points with possible business funding options and then prioritise in order of preference. Again, I must mention that it is not just about which has the best rate on the day. Here are other things to consider:


  • What combination of small business funding options will provide the most in available credit
  • What are the terms and conditions of the various products
  • Which mix of options creates the most flexibility for the business
  • What are the upfront and exit costs of each finance option
  • What is the likelihood the business will be approved by funders or investors

Only after getting an understanding of the above, then considering the rates or costs of each mix of funding option will you get the best result. 

Have you started out on your finance borrowing plan? Or what other options have you chosen for your small business funding?

Tom Radovanic

Sales Director at SMECASH