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Writing the Financial Forecast

When it comes to a business plan, you need a financial forecast. Whether you are trying to seek money from lenders and investors or just looking to plan the business for yourself, you want to see the numbers and you want to project what your profits and losses might be from your business.

Financial Statements

What financial statements do you need to include in your financial forecast? Every business plan should have financial data in it (usually in the back) and this is an important step of the business plan process. You will want to include facts, charts, tables, graphs, formulas and spreadsheets to help represent your financial forecast.

The most common statements to include are the cash flow statement, income statement and balance sheet. These three are interchangeable as they are linked and changes in one will affect the other.

Income Statement

The income statement is pretty simple and self-explanatory. It’s going to describe the proposed cash generating ability of your business. Basically, how much money you project you will be able to earn from your business. You will base your information on the costs of goods, price of your product, revenue, expenses, operating expenses, taxes, profits after taxes, etc.

Cash Flow Statement

Your cash flow statement is very important, especially if you are seeking investments or loans. This statement will explain how much money you need to start up and then maintain your business and keep it running smoothly. You are going to need to put how much money is needed to meet business and company obligations and where this money is going to come from.

Balance Sheet

The balance sheet will use all the information from the other sources to show the information on the company of assets, liabilities and equity. Established companies will want to use a balance sheet for a one year period. New businesses and start-ups may need to adjust this. At the end of the year (or period you are balancing) you will have record of the cash on hand, inventory or product, accounts receivable and your total current assets.  There are liabilities, accounts payable, capital and investments and more.

Your balance sheet will basically note where you stand (or predict you will stand) after a specific period of time. If a start-up, you should have a good plan for how to achieve the goals laid out in this financial forecast.  

Writing About Productive Procedures

Every good business plan needs to describe how you plan to effectively run the company or business to ensure success. Whether you are writing the plan to try to seek money from lenders or investors or writing the plan for your own business use, you can benefit from creating a plan for productive procedures.

Every business needs a design and development plan where you include information about your company, a description of your product or service, product development, market development and organizational development within the company. You need to be able to show prospective investors, business partner, employees and yourself your plans and goals for producing your product or service and how you will properly market it.

This is also a section where you will include a budget and your plan to meet those budget goals. You don’t want your productive procedures section to be scattered and disorganized so taking some time to do this part right is very important. Each goal that you list should be viable to the success of the company and you then need to have the steps to fulfill that goal. Your goals need to be feasible so that they can actually be achieved and they need to contribute to the success of the company.

Product Development

What is your product going to be? Where and how will it be manufactured and developed? Do you have your own factory? Will you order it from another company? What are the costs involved? These are all answers about your product that you will want to include here. What will be your goals for the product itself?

What is your budget for developing the product? How much time do you have to get product out? What is a key feature or element about your product that makes it different or better than similar ones on the market?

Market Development

How do you plan to advertise, to market and sell your product or service? How will the product be priced? How does this pricing compare to similar products or services found on the market already? What is special about yours? Will you offer special discounts or pricing?

What are your plans for marketing and how to you foresee carrying out these plans? You need to provide a clear and thought out plan for how you will achieve these goals and include information about how you, your business partners and employees are qualified to do so.

Business Plan: Writing It For Money

Are you seeking money from lenders or investors for your company or business? If so, then you know that you need a great business plan. Whether you are seeking investments, loans or grants for your business, you need a good business plan to be able to show why your company is worth it and what you have to offer to the business world.

The business plan is a great way for you to set and maintain goals for yourself and the company but it is also a great communication tool for letting potential lenders or investors know about your company. When it comes to business, everyone wants to see a business or company that will be successful. Your business plan needs to show that you know the odds against and for your business succeeding and that you know what to do to turn a profit. When writing a business plan for money, remember the following.

Planning for profits

Are you properly planning for profits? Do you have a good financial forecast in your business plan that includes not only a budget but how the company will work to achieve goals and make profits? Do you have a work outline detailing jobs of employees, payments, other expenses as well as how you compare to other companies in the same market? You need a stable and reliable plan of action to make profits. The successful business doesn’t just sit back and hope the profits come it; it gets out there are makes sure it happens. This is what potential lenders and investors are going to be looking for from your company and your business plan.

The three “C’s”

When a bank or lending institution is considering your business for a loan or investment, they will likely consider the three C’s – character, credit and collateral. Does your business plan include proof of these things? Are you showing them why they should invest in you and your company? Are you building the proper confidence needed for someone to give you money? Remember, they don’t want to take a risk with you so if you want to increase your chances of getting money, you need to show that you will be successful and how. They will be sure to bet on what seems to be a “sure thing” over a company that is shaky and unstable.