Finance Monthly October 2019 Edition

5 ABOUT JEFFREY POMERANCE JeffreyPomerance isPartnerandHeadof theTransactional Practice at SulmeyerKupetz, a premier business, financial restructuring and litigation firm in California, with a legacy of more than 60 years. He can be contacted at jpomerance@sulmeyerlaw.com or (213) 617.5244. 29 www.finance-monthly.com FINANCE & BUSINESS - 5 TIPS TO PROCUR E THE IDEAL SECURED BUSINESS LOAN IMPLEMENT AND MONITOR PERFORMANCE AND RESULTS Successful companies recognise that procuring the loan is just the first step in the process. Secured lenders almost invariably require constant monitoring of performance and results; successful companies generally stay one step ahead of their lenders. How is the company doing against the loan’s financial covenants? How do projections look against actual results? What market changes have occurred that may affect the company’s bottom line or collateral base? Has the company lost a key supplier or customer? All of these questions may need to be addressed both internally and, depending upon the terms of the secured loan, with the secured lender. Do not wait until notice to the secured lender is required without at least developing a game plan for addressing issues that arise and need to be addressed. Successful companies continue to challenge their assumptions, evaluate results and take corrective action at the earliest opportunity and certainly before the secured lender learns that corrective action is needed. Secured loans represent a vital source of working capital for today’s businesses, and come in a myriad of forms and types. Although a company’s collateral base will almost certainly have a significant impact on the choice of secured loan that works for that company, the ultimate choice of a secured loan that best meets a company’s needs should be based on an intelligent and informed approach to secured lending. Simply looking at the lowest interest rate will not work!