Browse by category- Financial Information
Content This section identifies the financial needs of your business and shows the potential profits, therefore, is one of the most important. A business can grow and survive only if generates profits. During the preparation stage of the business plan, we must know how much ... Read more
- Implementation and risks
When will start the major activities of the business plan, and who will be the responsible to carry them out? When will they finish these activities? ... Read more
- Protection and regulations
Copyright protection In case of any patent, branding, license or any other kind of protection is protecting the processes, products or services, describe them briefly. ... Read more
- Management and staff
The structure of the company Make a description of your company. How many personnel do you have, and how much would you like to have for the next years? ... Read more
- Marketing Strategy
Target Market In the last post Description of the sector, we described our marketing activity. Which clients or market segments your company will point for? For example, we may define an objective market by client type and geographic region. How your markets may change ... Read more
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- Writing business ideas
Leading a business idea into paper could be the most stressing and boring task, however it should be done every time an idea comes into mind. So, how can we write a new business idea onto paper? ... Read more
- A great business idea
Talking to a friend we realized our lives were around working for others, still having a well paid job yet we miss having free time for other activities. My friend is an average young man who works in an electronic manufacture enterprise as a Quality ... Read more
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- Failures in Business
Failure is the worst faith in business, also is the biggest impediment of thousands of people to start a new business because there will always be something missing. ... Read more
- The role of the women in the business world
Modern woman nowadays capable to achieve any task, entrepreneur, strong and creative has significant role in business. It’s hard to image how would be the world of business without direct intervention of women. ... Read more
- The most common mistakes in business
A business usually fails due the lack of ability of the owner, however this cause is not the only cause for business failing, there are other external factors which are difficult to predict and control: Global economy, competence etc. As mentioned before, the lack of ... Read more
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Sunday,January 31 ,2010 Content
This section identifies the financial needs of your business and shows the potential profits, therefore, is one of the most important. A business can grow and survive only if generates profits. During the preparation stage of the business plan, we must know how much money is needed and the expected profits. For this, the financial information that the business plan has, must include four documents:
- Monthly financial flows of the first fiscal year, which will show how much funds will ingress and how much will egress.
- Annual financial flows of the second and third fiscal year.
- Balance projected to three years.
- Income statement projected to three years.
Financial Flows
It’s an estimation of the quantity of money coming in and exiting on a determined time period.For this projection, we have developed the flow of five years. This information will help to calculate how much money is needed before having positive flows (more incomes than expenses) and when the investment will be recovered.
Furthermore, it will be useful to know when and how the capital will come in and how will out for the next months. Thus, we can estimate how much funds we will have on hand and know about potential financial bumps.
The financial flow projections, allow taking action in case the estimates not comply the real times of collection and payments. The logical steps to obtain all necessary data and to elaborate the set of spreadsheets are:
- Sales estimates of products and services: It’s about estimating monthly sales during the first year, and annually for the next years. This is applied to the main products or services provided by the company. It must include current and projected prices. If you are offering many services, indicate those that cover 75% of your total sales.
- Estimates of collections on your sales. What have been the arrears and bad debts from last semester?
- Sales production cost.Does your company have identified or developed any cost system and/or budget system? How have you estimated the costs of sales?
- Estimated cost of administration, marketing and taxes.
- Other financing sources, debt services and resource usage. What are your current financial sources? What dividend policy is compromised and/or will carry out?
All fund ingress or egress which is not coming from the business operation, for example, distribution of profits, loans, loans repayments and interest, or other, must be listed and described separately.
Balance
It’s required as a starting point. If the company exists, a template must be made with all data of the initial balance of the period, corresponding to the current business plan. Furthermore, the numbers contained in the balance sheet, we must know the following:
- Current financial situation to date to the business planning release.
- Exchange goods existences.
- Payments and collections deadlines.
- Major creditors on repayment terms and fees.
- Factors that have affected its profitability.
The main projected balance is necessary in order to know how will be the economical situation at the end of each year, specially, the relation between assets and liabilities in your business. We made this projection corresponding to a year.
Income Statement projected for three years
This template gathers all information that has been prepared previously to which each interest must be added for each credit operation. This includes depreciation and taxes corresponding to each projected year.
This is just an example:
Asset |
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Liabilities |
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Current Asset |
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Current Liabilities |
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Cash and banks |
$60,000.00 |
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Suppliers |
$100,000.00 |
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Accounts Receivable |
$150,000.00 |
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Taxes |
$30,000.00 |
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exchange goods |
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Other loans |
$67,932.00 |
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Raw material |
$8,881.60 |
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Finished goods |
$24,435.71 |
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Total current liabilities |
$197,932.00 |
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Total current Assets |
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$243,317.31 |
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Non-current liabilities |
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Non-current assets |
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Loans |
$102,068.00 |
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Goods |
$780,000.00 |
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accumulated amortization |
-$234,000.00 |
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Total non-current liabilities |
$102,068.00 |
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Total non-current assets |
$546,000.00 |
Total liabilities |
$300,000.00 |
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Equity |
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Total Assets |
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$789,317.31 |
Capital |
$300,000.00 |
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unallocated results |
$96,458.46 |
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exercise results |
$92,858.85 |
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Total equity |
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$489,317.31 |
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Total liabilities + Equity |
$789,317.31 |
Category Business PlanLatest Posts- Implementation and risks
Saturday,October 03 ,2009 Category Business Plan When will start the major activities of the business plan, and who will be the responsible to carry them out? When will they finish these activities? ... Read more
- Protection and regulations
Monday,September 28 ,2009 Category Business Plan
Copyright protection In case of any patent, branding, license or any other kind of protection is protecting the processes, products or services, describe them briefly. ... Read more
- Management and staff
Saturday,September 26 ,2009 Category Business Plan
The structure of the company Make a description of your company. How many personnel do you have, and how much would you like to have for the next years? ... Read more
- Marketing Strategy
Friday,September 25 ,2009 Category Business Plan
Target Market In the last post Description of the sector, we described our marketing activity. Which clients or market segments your company will point for? For example, we may define an objective market by client type and geographic region. How your markets may change ... Read more
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