Business financing basics: Budgeting, planning, and what to know before applying
Journey Capital TL;DR: Getting approved for small business financing starts with proper budgeting, solid planning, and understanding what lenders expect. Know your numbers, have a clear plan for the funds, and prepare your documents ahead of time to improve your chances of success.
How to get your business ready for financing
Financing can play a major role in helping your business grow, stabilize cash flow, or take on new opportunities. But before you apply, it’s important to be prepared.
Here’s how to budget, plan, and organize everything you need for a strong application.
Step 1: Budgeting for financing
Smart budgeting helps you borrow the right amount and ensures your business can comfortably manage repayments.
Identify your needs
Be specific about why you need financing. Are you planning to expand, restock inventory, improve cash flow, or invest in new equipment? A clear purpose helps avoid borrowing too much or too little.
Review your current finances
Take stock of your business’s financial health:
- Monthly revenue and expenses.
- Existing debt and current repayment commitments.
- Cash flow cycles and seasonal trends.
Forecast the financial impact
Estimate how loan repayments will affect your monthly budget. Make sure repayment terms work with your cash flow and won’t create added strain.
Step 2: Strategic planning
A clear, practical business plan shows lenders that you’re serious, prepared, and capable of managing financing responsibly.
Build a strong business plan
Include these key sections:
- Business goals and timelines
- Financial projections (monthly or quarterly)
- Market overview and competitive analysis
- Clear use of funds and repayment strategy
Define success
Have a clear idea of what success looks like for your financing. This could mean expanding your customer base, increasing production, or streamlining operations.
Prepare for the unexpected
Contingency planning matters. Show lenders you’ve considered potential setbacks, like slower revenue periods or rising costs, and how you’ll respond if they occur.
Step 3: Preparing to apply
Before you hit “submit,” make sure you have everything in place to avoid delays or surprises.
Check your credit profile
Review both your business and personal credit scores. Fix any errors and take steps to strengthen your credit profile if needed.
Gather your documents
Lenders often ask for:
- Profit and loss statements
- Balance sheets
- Cash flow statements
- Recent business bank statements
- Business and personal tax returns
Understand the lender’s requirements
Each lender is different. Research eligibility criteria, required documentation, and financing options before applying. It can save you time and improve your chances of success.
Benefits of Journey Capital
- Only borrow what you need: Stay lean and flexible.
- Understand the total cost: Look beyond the interest rate.
- Ask for help if needed: Talk to your accountant or financial advisor if you’re unsure about your numbers or loan structure.
Why choose Journey Capital?
At Journey Capital, we work with Canadian small businesses to make financing straightforward and supportive. With fast applications, flexible options, and clear guidance every step of the way, we help you get the funding you need to move your business forward.
FAQs
It ensures you ask for the right amount and shows lenders you have a strong handle on your finances.
Financial projections and your loan use strategy are key. Lenders want to know how the money will be used and repaid. Not all lenders require a business plan. At Journey Capital we keep requirements as simple as possible.
No, Journey Capital looks at the full financial health of your business; not just your credit score.
Yes, financing can support growth, help manage cash flow, or create buffers during busy or uncertain times.
Build a budget, estimate how much financing is necessary, and match loan size to your repayment ability.
Most lenders will ask for financial statements, recent bank statements, and tax returns. Having these ready speeds up the process and shows you’re prepared. At Journey Capital, we want to keep things simple so all we ask if a little information about the owners (for identification), the business, and your financials (most recent business bank statements for the last 90 days).
Prepare your business for financing success. Apply online in less than ten minutes. There is no obligation to continue and applying will not affect your credit score.