SMB Strategy Cast #16 - Business Plan - Financial Plan Part 2

May 5, 2006Podcast Description – Cover business strategy topics that pertain to startup, small and medium business.In this episode - This is the second episode in a 2 part series on the FINANCIAL PLAN. Will cover what is included in the Financial Plan and give tips for creating the Financial Plan. Using Microsoft Excel or another spreedsheet program to set up the financial statementsIn general, create forecasted financial plans with 3 Years – 1st year by Month, 2nd & 3rd year by quarter.I like to build the Excel with 6 sheets, 3 are for internal discussions: Assumptions, Startup Costs, and Projections. The other three sheets are the financials that will get copied into the business plan: P&L, Balance Sheet, Cash Flow.Assumptions – Big Picture Text to set the reader’s mindset – Example: Revenue in the first year will be $2 million and grow 10% per year.Startup Costs – What is needed to get the business up and running or get a product into production? Examples: Equipment, Real Estate, Salaries, etc.Projections – Detailed profit and loss by month for the 3 years. On the P&L you show revenue, on the Projection you break down the revenue into its major components. Example – A product company may show major products or product lines and show the sales by month and use the assumption of growth by 10% per year. P&L – I actually put three statements on this sheet. Three year annual, which is just the total form the other two statements, 1st year by month, and 2nd & 3rd year by quarter. Most of the items on the P&L are just sums form the projection page.Balance Sheet and Cash flow are the final two sheets. – like P&L I include three statement: 3 year annual, first year by month, and 2nd & 3rd year by quarter.Podsafe Music at beginning and end of show - MSFF, “Brooklyn”. For more info on MSFF go to there page on the podsafe music network. Or, for more podsafe music go to music.podshow.com. Email questions or comments to [email protected] help with your business plan, startup or strategy project, check outwww.eaglestrategygroup.com and www.bizplanhelp.comDownload this Episode