Thrilling Thursday – it is thrilling to develop a plan for business success.
Each Thrilling Thursday throughout the month of November will be dedicated to creating a plan for starting or running your business. At the end of this series, if you follow the articles and complete each section, you will have a complete business plan you can use to operate your business or seek financing. The last few Thrilling Thursday articles in November have covered the purpose statement, executive summary and business information, personnel and organization, and marketing information. Next week, the final Thrilling Thursday business planning article will cover the final section of the business plan – financial projections.
photo credit: Beverly & Pack via photopin cc Thrilling Thursday, business plan, success, financial condition, plan, finances
As was discussed in Part One of this series, a business plan is a tool for gathering all the important information about running your business and your financial condition all in one place. A well done business plan will help you run your business on a day to day basis according to a pre-set, well thought out and organized plan. Even in times of unexpected crisis, a business plan is a great tool, to keep you focused, on track and mindful of the big picture you have set for your business. This Thrilling Thursday section will be dealing with the current financial information section of the business plan.
The financial information section of the business plan is where you set out the financial aspects of your business. In this section start up businesses will include start-up costs and a description of how the loan will be used. This section will provide the reader with a clear picture of your profits and losses, cash flow and other relevant financial information. This is where you will put your balance sheet, income statement and other related documents. The financial information section of your business plan will include the following sections:
- use of loan money
- start up costs
- profit and loss statement
- cash flow information
- balance sheets
- revenues vs costs
Use of Loan Money
This section applies only to those who are using the business plan to obtain financing. In this section list out all your uses for the borrowed funds as in the chart below:
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Use
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Description
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Amount
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First use
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Explanation of use
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$0.00
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Second use
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Explanation of use
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$0.00
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Third use
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Explanation of use
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$0.00
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This is an opportunity for you to provide all the informaion
Start-Up Costs
If your business is a start-up use this section to explain the costs of starting your business. This is the place where you explain what money you put into the business, where it came from and what you used/are using it to accomplish.
Profit and Loss Statement
Any person who is considering making a loan to or investment in your company wants to see your profit and loss statement. A business needs to make money and this is where you show that your business will be a profit making enterprise. Use this section to explain costs of goods, operating expenses and all other items that go into making your business operate at a profit or loss.
Cash Flow Information
Use this section to attach a detailed statement of cash flow in all your business accounts. Be sure to include beginning balance, sources of income, expenditures and ending balances.
Balance Sheets
Attach your current balance sheets. Be sure to have explanations for current assets, liabilities, and equity.
Revenues vs Costs
Use this section to list fixed and variable expenses compared to income. This is where you figure out how much money you need to make in order to cover your expenses.
Over the course of the next week, complete these sections of the business plan so you will be prepared to start the marketing section with next week’s article. As always, if you need assistance or guidance as you complete this section feel free to contact me:
Janeane Davis
James, Davis and Associates
2737 Cambridge Street Suite 2
Philadelphia, Pennsylvania 19130
215 5826 3897
businessplanning@janeanesworld.com
The current financials section of your business plan gives both you and outside parties a clear picture of what is going on with your business financially right now. As a business owner, you should always be aware of your financial picture. So the question for you this Thrilling Thursday is, what is the current financial condition of your business?
Hmmm..I’ve missed the other Thursdays. I’m gonna go back and check them out. I’ve been reading Black Enterprise about finances these days && I know I need to do better with this aspect so I’m gonna stalk your page a lil bit!
Stalk away. I am writing an e-book about this topic. When is complete, I will announce it in SOSM group and give you a copy. This article has links to the other parts of the business plan. The final section, will be posted next Thursday.
The money area of business planning is one that a lot of people tend to skip over, not realizing that it is the most important piece of the plan no matter what type of business it is. You laid it all out right here and I’m so glad that you did because it’s very important to understand all that needs to be done. Thanks for sharing!
Thanks! You are right, the money part is crucial!
I will admit that this is the side of my business that I’ve been slacking on. Thanks for the reminder.
Laila, this is an area we all slack on sometimes because it is usually not our specialty. However once we control and understand where our money comes from and where it goes, we will be more successful.
Thanks for sharing this info and making yorself available to help.
You are welcome. I am the oldest of six and mama of four I don’t think I know how not to offer to help! hahaha