Understanding the financial landscape and available options is crucial for business owners seeking to grow and manage their operations effectively. From securing financing to managing cash flow, a solid financial strategy, developed in partnership with a trusted advisor like a business banking officer, is essential for long-term success. This strategy will vary depending on the business's specific needs and its current financial standing. While navigating the details can seem daunting, leveraging the expertise of a banking officer can help simplify the complexities of business finance.

Securing Financing

Securing business financing can be a cumbersome process. Much like Christmas shopping, planning and preparation can aid in the process, but many still find the holiday has arrived before they know it. Under ideal circumstances, securing financing can take 4-6 weeks; however, the process often stretches over several months, particularly when real estate purchases, large transactions, or more complex operations are involved. Many steps depend on the completion of the previous one, which can limit the level of preparation possible. Business owners must be ready for a structured process that includes several steps, such as obtaining necessary registrations, working with accountants or lawyers, and meeting legal requirements.

Business Loans

One major difference between business and consumer loans is the role collateral plays in relation to the total loan amount. Business loans typically do not cover the full value of the collateral, meaning the business will need to contribute cash in or seek alternative options, such as leveraging personal assets. Business owners often overlook personal assets, including real estate, vehicles, or savings, which can be used to help secure financing.

A business banking officer works closely with the client to strengthen loan applications by providing a comprehensive financial picture for loan underwriting, including both business and personal financial statements.

Flex PACE Financing

The Flex PACE program has been a valuable option for many business owners in North Dakota. Although this program is dependent on the county where the business is located, it allows businesses to benefit from reduced interest costs over the life of the loan. This helps businesses reinvest interest savings and provides additional cash flow options. Bravera business banking officers can answer questions about the program and assist business owners interested in applying.

Managing Cash Flow

Cash flow can be a recurring challenge for many businesses, depending on their income model and timing. While programs like Flex PACE can offer alternative options, a business line of credit can be especially helpful in managing seasonal income fluctuations or periods of growth. A line of credit functions like a business credit card, providing the flexibility to borrow as needed without tying up significant capital. Business owners often use a business line of credit for expenses such as:

• Day-to-day operations
• Payroll and benefits
• Supplies and inventory
• Insurance premiums
• Taxes

Want to learn more about business lending with Bravera? Contact Business Banking Officer Val Decker at 701-483-3276 or vdecker@bravera.bank.