project report

  Although a customer Letter of Intent (LOI) is not always regarded as a guaranty of future revenue, it can bolster a bank loan project report by demonstrating possible demand for the suggested good or service. Before determining how much weight to give the LOI, a bank may compare it with the applicant's sales forecasts, production capacity, current customer data, orders in hand, and other business evidence. Sharda Associates uses customer LOIs as supporting information in CA-expert-led project reports where relevant, but projected sales should still be based on realistic financial and operating assumptions rather than assuming that every LOI will become a completed sale. What Does a Customer's Letters Of Intent Actually Prove? Suppose you are planning a new manufacturing unit and a potential customer gives you a letter stating: “We intend to purchase approximately 10,000 units annually, subject to price, quality and commercial terms.” That is useful. It shows there may be ge...