A business plan has a lot of important elements to help you secure funding and launch a new business. That’s why we’ve been spending some time talking about what to include in different sections or types of business plans. Arguably, one of the most important parts of a business plan is the financial section, especially when using the plan to secure investments. Potential investors want to see your current and projected financial information. So, here’s what you should consider when working on that section:
Sales Forecast: Using a spreadsheet, project your sales over the next several years. A business plan expert can help you decide how far out you need to project for your specific industry. Either make an educated guess or use past results to help determine your projections. Starting with the forecast can help you figure out additional finance needs.
Expense Budget: How much is it going to cost to run the business and make the sales you’ve forecasted? Make a budget of both fixed and variable costs, estimating interest and taxes for various items.
Cash Flow Statement: Create a cash flow statement showing how money will move in and out of our business. A typical cash flow statement is broken down into 12 months.
Income Projections: Using the sales forecast and cash flow statement, work on detailing the income forecast for your business. If you are unsure, work with a business consultant who can help talk you through this.
Projected Balance Sheet: Some of the assets and liabilities won’t be included in the other sections, so be sure to include them here. Assets include month by month cash, accounts receivable, inventory, buildings and equipment. Liabilities are your debts, so any bills you haven’t paid yet (accounts payable) and loans.
Breakeven Analysis: When will your business break even? Financiers want to know this, so include an analysis in your business plan to give them an idea of your goals and projections.
Get expert help creating your business plan, because business plan consultants know how to create a plan that works. They have helped thousands of people just like you write business plans by asking the right questions, getting to know you and your ideas and helping you develop new ideas to incorporate into your plan. Get in touch with Bargain Business Plan today for a free consultation to learn how we can help you with your business plan needs.
Be sure to check out future What to Include blog posts!