Financing ongoing operations of a business often reqires outside funding sources. Those sources most often come in the form of banks providing operating lines of credit and term loans.
Banks look at a number of variables when evaluating how much credit to extend to a business.
One of those variables is how well the business has performed versus what has been projected. It is important to be realistic and conservative when preparing budgets and projections for bank review. When a business consistently fails to meet projected net income, it begins to lose credibility with its funding sources. Meeting or exceeding projected profit numbers will strengthen your businesses' relationship with its lending sources. Employees Communication is a key elements of success in business.