Part 1 of a 3 part series

Warning Signs:

• Increasing net sales to net working capital.
• Rising net fixed assets to tangible net worth ratios.
• Rising debt to tangible net worth ratios.
• Difficulty borrowing funds.

Steps to Improve: PLANNING YOUR BORROWING

• Use a monthly cash flow analysis to forecast financing needs.
• Prepare realistic, conservative projections; underestimate income, overestimate expenses.
• Use projections to monitor the business and build confidence with your banker.