However, the financial plan is a self-supporting document intended to support and direct the actions of the business. This site is a great resource for not only finding sample plans, but also for creating a business plan online using their step-by-step approach. We are super excited to introduce you to our accountant in a free upcoming webinar. Ratios You can easily go wrong with your financial plan if you simply pull out your documents and fill in the numbers. About the Author Writing professionally since 2004, Charmayne Smith focuses on corporate materials such as training manuals, business plans, grant applications and technical manuals.
This analysis can be done either mathematically or graphically. It can be expressed in: 1 Total dollars or revenue exactly offset by total expenses -or- 2 Total units of production cost of which exactly equals the income derived by their sales. If you are seeking a lender or investor, ratio analysis as compared to industry standards will be especially critical in determining whether or not the loan or venture funds are justified. Financial Statement Analysis In this section you will use your income statements and balance sheets to develop a study of relationships and comparisons of: 1 Items in a single year's financial statement, 2 comparative financial statements for a period of time, or 3 your statements with those of other businesses. Expenses Budget Putting together and expenses budget will help to balance out your sales forecast. Summary of Financial Needs needed only if you are seeking financing This is an outline giving the following information: Why you are applying for financing How Much capital you need Loan Fund Dispersal Statement needed only if you are seeking financing You should: Tell How you intend to disperse the loan funds.
Summary Description of the Business In a paragraph or two give a broad overview of the nature of your business, telling when and why the company was formed. Project future needs for adding employees. How do you know these people exist? It summarizes the key elements of the entire business plan and is the first thing anyone looking at your business plan reads so it's critical that your executive summary is outstanding. You must also determine which type of financing would be most suitable for your business. Statements Your small business financial plan should include four standard forms that attached documents support. Why were you doing it? Remember how I said I had to get help? How much will these expenses be, and how often will you need to pay them? Miscellaneous Documents All other documents which have been referred to, but not included in the main body of the plan. Many therapists pick their fee based on what insurance reimburses them, what they see their peers charging or they base it on what they would pay for therapy for themselves.
Automatic financials - no spreadsheets required With LivePlan, you don't have to worry about navigating complex spreadsheets or breaking formulas in Excel. If you are turned down for financing, be sure to retrieve your business plan. Sales Forecast Using a spreadsheet is the best way to put together a sales forecast. Cash flow statements not only show potential investors that you know what you're doing, they also help you to make sure your business model is financially viable and to establish goals that you want to achieve. Institutions and financial specialists use an array of ratios to identify the information they seek about your business.
In fact, filling in the numbers in some areas like the profit and loss statement monthly and then comparing them to the income projections is a good idea. The current month's revenues are added to this balance; the current month's disbursements are subtracted, and the adjusted cash flow balance is carried over to the next month. These forms provide a well-rounded financial view of your business, from your personal finances to the business finances. The Business Financial History and Loan Application are frequently one and the same. A detailed explanation of your sales strategy, pricing plan, proposed advertising and promotion activities, and product or service's benefits. Everything You Need for Your Plan Your business plan will be complete and correct—guaranteed. My first business plan was a napkin sketch but in that napkin sketch were some key components that helped me be successful and I want to help you today figure out those parts so you can feel confident that you have your business planning basics down.
Your balance sheet must balance at the end of every period. You can then implement changes that will give you a competitive edge and make your business more profitable. Take it one step at a time. Do you plan to sell the business outright to another individual or company? Cash Flow Statement When you put the sales forecast and the expenses budget together, you get a cash flow statement. Cover Sheet Serves as the title page of your business plan Name, address, and phone number of the company. Liquidity Analysis net working capital, current ratio, quick ratio Profitability Analysis gross profit margin, operating profit margin, net profit margin Debt Ratios debt to assets, debt to equity Measures of Investment return on investment Vertical financial statement analysis shows relationship of components in a single financial statement Horizontal financial statement analysis percentage analysis of the increases and decreases in the items on comparative financial statement Business Financial History This is a summary of financial information about your company from its start to the present. As a rule, the financial part of your plan should follow these as set by the Federal Accounting Standards Advisory Board, especially if you're putting it together primarily to get a loan or a line of credit.
Its great information to help you succeed in Business. Credit Reports Business and personal from suppliers or wholesalers, credit bureaus, and banks. And then we get to the really important part - what makes you unique? You'll define the steps needed to achieve those goals. Do your homework by analyzing markets and researching competitors and trends. Make sure that your farm plan fits into the general market in terms of supply and demand. Lenders may want your statements presented in a certain way, so ask before you draw them up. They may not agree with your suggestion, but offering proposed terms shows that you are considering the loan from the lender's perspective.
The first one is a comprehensive example of a fictitious airport café business looking to open a new site. For investors, the cash flow projection shows whether your business is a and if there is enough cash on hand to make your business a , a , or a longer-term investment. Revenue and expense figures are drawn from the three-year income projection. Whatever their form, financial statements must be complete, accurate and thorough. Your purpose is the foundation of all your business decisions. Sales Forecast The Sales Forecast is a chart that breaks down how much your business expects to sell in various categories by month for the next year and by year for the following two to four years.