06 Jul Thinking of being an Agribusiness broker?
Here’s 8 things you need to think about if you decide to go it alone.
1. Leave yourself enough time.
Securing agribusiness finance isn’t something you do with a single phone call or set of forms. It would be best if you took the time to research the best options available and narrow them down to one or two lenders. And then, you’ll need time to read through all the requirements and work out what documents you need to provide. Only then can you pull all the information you need together. Making sure that you provide the correct information the first time is essential. You don’t want to miss out on a piece of land because of inefficient turnaround times.
2. Brush up on your business and finance knowledge
If you haven’t applied for agribusiness finance before, you mightn’t realise how much specialised language there is. Sure, the banks and financial sector have tried to embrace ‘plain English’. But we’re dealing with a complex subject that takes longer to learn than a Finance for Dummies crash course.
Have you done it all before? Remember, there have been enormous changes to the rules and regulations around lending. Don’t assume that things will be the same as the first time you borrowed. And chances are your business and operations are probably more complex too.
3. Understand your local region and industry
You’ll need a solid understanding of more than your business. You need to understand the dynamics of your region and your industry. Are you competitive? Are you aware of your industry’s risks and challenges, and have they affected bank policies and lending appetite in your industry? These can change as the economy and markets fluctuate.
4. Build your networks
Who is in your local network? Most brokers have a vast network of bank contacts. They know other advisors that could help your business, whether you need HR, marketing, accounting or additional business support. You’ll want some independent advice before you seek finance to make sure everything is in order.
Do you know other businesses in your area or industry that have experienced similar challenges? Are you able to share your experience with them and ask for advice?
5. Source independent advice
How are you going to choose which bank or finance provider is the right one for you? Do you go with the best interest rate, the “nicest” manager or the lender with flexible options?
Don’t be fooled into staying with the bank you’ve always used or change to the one your mate uses because he’s had a good experience. Your business is unique; at different times in your business lifecycle, you will need other things from your lender. Are they going to be able to provide that to your business?
6. Tell Your Story
When you are seeking finance from a lender, you need to “tell your story”. Help prospective lenders understand what you and your business are about. It should be in the form of words and numbers detailing historical and forecast information. Support your story with facts from your financial reports and sales history.
Negotiate with lenders on key aspects of any finance proposal received. It’s not just interest rates; it is the loan terms, conditions, covenants and security. They all form part of ensuring you end up with a finance package that is cost-effective and flexible enough to meet your business needs.
8. Are you really saving money?
The first reason for going it alone was the time it would save. You’ve read all the things you need to do and understand; securing your own finance can be time-consuming. And without the right product, understanding of terms and conditions and advice, you could end up paying more for your finance.
Now consider the alternative. An experienced, well-connected agribusiness broker.
What if we said that using a broker won’t just save time and money? That it could also save you the stress of researching the right option. Save you talking to many people and trying to explain your business to yet another bank manager.
We are across the latest industry regulations and products. We’ve got experience working with many businesses just like yours. We know who to talk to the first time and have the tools to assess which product will work best for you in the long term. We have networks that include the experts and advisors you need to consult to strengthen your financial position. And best of all, a broker can work around your business, meeting you when it suits you best.
If you want to save time and money we can get on with securing you the best agribusiness finance deal possible. Leaving you to get on and grow your business.