Before the negotiation - Business Identification Blog

1. The bank-firm relationships should be based on mutual trust. The record and previous experience, coupled with the mutual understanding between the company and bank are assets to be valued. The last of the company for help, but no guarantee of future.

2. Do not ever lie to a bank, our credibility would be damaged.

3. There must be clear that to address a successful negotiation and enduring in time we must understand that the bank also has to make money.

4. The credit operations are the core business of financial institutions. A bank tries not to take risks in lending money. This is common to any other company. Banks also try to reduce the risk of default.

5. For if anyone had any doubts, banks do not help anyone.

6. Branches are evaluated and rewarded by the returns that contribute to the entity.

7. Define the number and type of banks with which we work. It is important to choose the type of bank that need national, international, large, small, with a large number of branches, operating over the Internet, personal attention, expertise, and so on.

8. It is important to have a banking pool consisting of more than a financial institution, so we covered before the policy changes that they can undertake. In addition, having more than one allows us to compare conditions and services. A bank never wants to be the sole financial provider of a company. I always prefer to share risks.

9. Working with a large number of financial institutions creates significant administrative work that we must weigh the potential benefits. Banks do not look good that the company works with too many banks, excessive banking business deal makes the company less attractive as a client.

10. Listening to all banks that are knocking at our door, it?s good to know the news that we propose, the policies they pursue. We never know who and what we need. This also helps us to know the industry and have personal relationships with people who work in it.

11. Be aware of the smaller banks and or need to break into markets where they have no roots because they can be at any given time more competitive. A single entity may provide better conditions for her new markets than in markets where already established.

12. It should be clear about the financial policies of the company before you start trading: investment policy, financing policy and dividend policy.

13. Demonstrate a degree of loyalty in banking relationships

Preparing for negotiation
14. Negociar ahead, anticipate future financial needs both long and short term.
15. define what services and products need to negotiate with banks.
16. Treat with appropriate banking partners, depending on the volume and nature of credit transactions.
17. The fee to which a bank is generally comfortable in a business is between 25% and 35%.
18. The financial institutions know the share of business it has with the company does business. This information is obtained from the credit bureau Bank of Spain.
19. negotiate with the banks providing a guaranteed turnover during the term of the agreed conditions. No auction the banking business.
20. When a bank risk analysis considers: the fate of the money, the repayment capacity and the guarantees it takes to hedge against the risk of default.
21. A bank repayment capacity analyzes discounting free cash flow the company generated cash flow of the current debt. Be clear on this point the difference between profit and cash flow (free, debt and shareholder).
22. Financial institutions do not assume any risk without the existence of a security. Nor do when only the guarantee but not the ability to repay debt. The maximum guarantee for a bank is the mortgage, which link a real estate asset to debt repayment.
23. Knowing the limits of authority in granting credit you have the partner bank we dealt with (director of branch, zone or territorial).
24. Find out what products and concepts more impact on the remuneration of our interlocutor.
25. It is recommended, prior contacts with a new financial institution, make him see a clear readiness to conduct operations for the same service who require us to lower prices.
26. The best place for the negotiation are the offices of the company. It is a good time to teach our partners the company premises so they know firsthand the business.
27. Seek to respect the agreed dates for the meeting. Cause change bad impression on several occasions.
28. When ask for a credit transaction must be submitted to several entities at once and let them know every one of them. In this way we do in competition between them and the way we cover ourselves with the assumption that request into a single entity and that we refuse it. This is usually not disturb the banks see it as a matter of course by the company.

Source: http://www.benson-vs-identix.com/business-news/before-the-negotiation.html

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