Tell-All Books Win All Bankers

 

Most business owners insist that bankers don't understand the financial realities of growing acompany. Bankers retort that business owners are out of touch with the reality of credit rules and banking regulations.

Jo Anne Schiller, chief executive of Everyday Learning, a $7 million educational publisher in Evanston, Ill., thinks she has no choice but to let her bankerknow everything about her business. "Our financial picture is very complicated because our business is seasonal: 85% of our orders come in from May toSeptember. We couldn't survive without a bank line of credit."

When her bankers asked for as much information as she could give them, she responded with an annual forecast "full of excruciating detail." Inthe 12-page document, Schiller includes best- and worst-case forecasts of how many sales units will move and how many dollars they'll bring in. At everystep along the way, she spells out the assumptions behind the numbers.

The unusual degree of disclosure has built up her credibility with her bank. That's made it easier, says Schiller, to get and keep the credit she needs.


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