Raising bank money is a marketing effort.  Since it is marketing, let’s go back to the 4 P’s and marketing and see how they can help you raise money from a bank.

1. Product.  What type of performance do you have to offer a bank?

a. How are your operating results?  What cash flow can you offer?

b. What is the underlying collateral?

c. How is the management team?  How would a bank rate your competence and character?

d. What type of loan are you looking for?

2. Price.  What kind of rate and terms are you looking for?

a. How does the rate you look for match up with the current market for your type of loan?

b. What length of loan, collateral base and other key terms do you seek?

c. What covenants can you handle and how risky are your projections.

3. Placement.  Where are you going to look for financing?

a. What type of institution- factored, commercial finance, traditional bank or other party?

b. What size of bank- large, medium or small? 

c. What treasury services do you need and can the bank offer them?

4. Promotion.  What are you doing to promote your company to the banking community?

a. What kind of business plan have you put together?

b. What presentation and site visit have you set up?

c. How does your website and collateral help promote your business?

d. Have you been regularly promoting yourself to the banks or just calling them now?

You need all 4 parts to effectively market your business to customers and prospects and grow your business.  You need the same as well to get the best banking package to fit your company.  Treat the marketing of your company to banks just as seriously.  Get a jump on it long before you need money.

If it is too late to be early and you need money now, then you need the 4 P’s even more.  

Don’t just do it alone- considering having an outside opinion on your marketing program for bank financing.  It could be a board member, your accountant or other consultant.