Issue link: http://read.dmtmag.com/i/81015
MANAGEMENT sourcing grapes, planning capi- tal expenditures or contemplating mergers and acquisitions. The U.S. economy has been growing since the second half of 2009, according to Department of Commerce figures. And with that growth the lending climate has improved. The economic recovery has helped spur demand and sales in the wine industry, and so not surpris- ingly wineries, growers and other businesses have been looking to expand. Demand for credit is back. For their part, many lenders are in a much stronger position today to provide credit. They have bolstered their balance sheets and have been seeking assets – sometimes reduc- ing pricing on loans and loosen- ing credit terms. This is occurring across various industries. Com- mercial banks have been steadily increasing commercial lending since the second half of 2010. According to figures published in the Federal Depositor Insurance Commission's (FDIC's) Quarterly Banking Profile for the first quarter of 2012, loans in the first quarter to commercial and industrial borrow- ers were up 14% and farm loans were up 6% from a year earlier. Bank loans may be the best- known source of financing to the wine industry but, of course, they are not the only source. There are a number of less traditional avenues, including equity financ- ing, Real Estate Investment Trusts (REITs), asset-based lending and debt financing, including mezzanine AT A GLANCE Banks have been increasing com- mercial lending since the second half of 2010. The fundamentals of sound lending still apply. A good business plan plays a key role in any loan application. Bankers want to see a seasoned leadership team. Your business should have a solid balance sheet. WWW.VWM-ONLINE.COM SEPT - OCT 2012 VINEYARD & WINERY MANAGEMENT 65 debt, which has characteristics of both debt and equity financing. Demand for credit and its avail- ability ebb and flow with economic cycles, as do pricing and terms. Similarly, various financing sources may be more in vogue at certain times. But the fundamentals of finance center on a few key factors. Here are five tips to help increase the chances of getting a business loan: GOOD BUSINESS PLAN A business plan is an important factor in evaluating loan applica- tions. The details of the plan show You know the effort that went into each bottle of wine... Do you know the costs? Vintegrate Winery Software Visibility Grape To Glass • Wine Production • Inventory Tracking • Financials (G/L, A/R, A/P) • Allocations/Futures/Depletions • Direct Sales and DTC Insight • Integration Engine • Business Intelligence Dashboard • And More... info@vintegrate.com 800�487�3363 600 Bicentennial Way, Suite 300 Santa Rosa, CA 95403