My partner and I have a cafe. We've been in operation for about 2.5 years and have been doing well. Sales have been steady and we've been consistently making a profit but we've begun to plateau since our food choices are somewhat limited and we're losing business to the lunch crowd.
We want to take out a loan to convert an area of our business to a small kitchen/bakery. We contacted the loan officer at our bank and he's asking the following.
Please provide me with the following business assets in dollar values: Inventory (raw goods and supplies): Equipment (machine, tools, refrigerators, tables, etc): Account Receivables (money owed to the business 30/60/90):
1: Our inventory of supplies and raw goods changes constantly and is also frequently perishable.. What should I base this off of?
2: How do I factor the value of our equipment after taking depreciation into account? What about items that we built ourselves (we built all the tables ourselves for example).
3: We don't really have much in the way of accounts receivables as we're a cash based business. Credit card sales are deposited in the bank the next day. How should I answer that?
Also we have the option of a loan with a 12-60 month term or a revolving line of credit. Assuming the same interest rate what would be the better option?
Submitted July 20, 2016 at 06:44PM by anarchyx34 http://ift.tt/29UWVen smallbusiness
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