If you are encountering issues following the content on this page please consider downloading the content in its original form This unit describes the performance outcomes, skills and knowledge required to develop a financial plan to support business viability.
Specific legal requirements apply to the management of a small business.
Here are six reasons to create a business plan for your startup.
Think of your business plan as a roadmap for your startup’s journey.
You’re forced to think about the hard questions, such as – is my price point high enough? Make a cash flow forecast part of your business plan too, so you can see if the costs all square up – and be brutally honest.
It’s always better to overestimate and end up with a bit of spare cash.It shows that you’re reliable, that your idea is going to work, and that you’re committed to making this business a success.Show people exactly why they should work with your business with cold hard facts that nobody can argue with – market research, cash flow forecasts, and early orders.Identify sources of finance , including potential financial backers , to provide required liquidity for the business to complement business goals and objectives 3.3.Investigate cost of securing finance on optimal terms 3.4.Identify working capital requirements necessary to attain profit projections 2.3.Identify non-current asset requirements and consider alternative asset management strategies 2.4.Calculate break-even sales point to establish business viability and profit margins 1.4.Identify appropriate pricing strategies in relation to market conditions to meet business profit targets 1.5.But by making goals, targets and timeframes in your business plan, you can keep yourself motivated and always remember to be working towards the next thing.Think about tangible things you want to achieve in a month’s time, three months, six months, a year. If you’re applying for funding, seeking investors, or looking to work with other businesses, a business plan is a must.