It is always useful to write up a business plan. A business plan is a structured presentation of your plans for your business, with figures and written descriptions. Working on a plan and forecast will help you to think about, and come up with answers, to many challenging issues connected to starting up and running a business.
A well thought out business plan, and the process of writing it, are extremely helpful when it comes to making decisions and as a guiding thread to follow when your business expands, and strategic crossroads are reached.
In addition, a business plan will allow others to understand what you are planning and will enable them to reach a decision as to whether or not they would like to work with you and provide potential economic support for your ideas.
The business plan is the most important strategic document in your company and is as vital to a sole trader as it is to a large business. How detailed the document needs to be varies, but essentially all business plans are built on the same principles.
A good business plan helps you focus on your business development step-by-step. You describe your customer's needs and how you plan to satisfy them. You make important choices regarding the partners who you plan to work with: on production, logistics, marketing, finances and sales. The business plan should be optimistic, yet realistic and fact-based.
The final product should provide its readers with all the information they need to be able to believe in your success.
There are many instances where a business plan proves invaluable especially during the business start-up phase. If you are going to apply for a loan or grant you will need to deliver a thorough business plan. Most businesses require bankers, partners and investors, all of whom frequently demand to see a business plan before they continue their co-operation with you.
Preparing The Figures
Unless you are an experienced business person, or had training in accounting, you may require help with the figures. We provide this service.
There are three important reports which summarise your businesses plan for the future:
The figures should be summarised by month and in one year blocks. A good idea is to have 36 months in blocks of three years.
When you prepare the month by month plan, you begin to appreciate timing issues. For example you may make a sale in May, but not receive the money until June. So in the Profit and Loss Account, the sale appears in May, but in the Cash Flow the sale appears in June. These timing differences also occur with expenses: some expenses, eg. salaries are paid in the month, whilst your rent may only be paid quarterly but would need to be spread across 3 months in the Profit and Loss Account.
We have pre-prepared Business Plans which will speed up this process for you. Please contact us for this service.