Many business owners, in small and large firms, don’t really focus on their balance sheet. They look at their profit and loss and, if they’re making a profit, they think ‘everything’s fine’.
From our experience, the balance sheet of a business is often the key to its success.
This is because a healthy balance sheet is often the key to being able to withstand shocks; it gives financiers the confidence to support your business with additional funds when things are tight.
How to control your bank’s appetite for lending
In our free eBook, Managing Your Banking Relationship, we outlined our top tips for controlling your bank’s appetite for lending.
A bank, financier or equity investor focuses on three S’s when considering their appetite for your business. They are:
- Servicing
- Security
- Surety
A healthy balance sheet is key to ensuring the second ‘S’ on that list, your security, is in a positive position.
If you would like advice or support about any aspect of managing your business, contact the team at JPAbusiness on 02 6360 0360 (Orange) or 02 9893 1803 (Parramatta) for a confidential, initial discussion.
James Price has over 30 years' experience in providing strategic, commercial and financial advice to Australian and international business clients. James' blogs provide business advice for aspiring and current small to mid-sized business owners, operators and managers.