The Financial Plan within a Business Plan

When writing a business plan, the sales and revenue forecast must be granular and detailed and incorporate a believable ramp-up time. P&L’s must be exhaustive and all-inclusive. Cash Flow statements must show the intended use of capital and support the amount of the loan/investment requested. Included:

• A detailed discussion regarding “Assumptions and Conventions”. In this section, we demonstrate to the reader that we have carefully and conservatively considered all aspects of the business. The reader may disagree with our assumptions and ask for a “revised down” version of the financials but your credibility will be established through this disclosure.
• Income Statement (Typically for three years)
  • Monthly per unit sales of each category of product or service.
  • Schedule of all prices
  • Include seasonality factors if applicable
• Profit & Loss Statement (Typically for three years)
  • Monthly recurring expenses (exhaustive detail)
  • Cost of Goods Sold
  • Reflect lead times regarding ordering, shipping, selling, and receipt of revenue (back to Income Statement).
  • Detailed Start-Up Costs
• Cash Flow Statement (Typically for three years)
  • Reflects monthly cash flow including:
    • Supply chain process
    • Seasonality

Back to the PMC Plan Process (click here)