Create Financials Using Score Templates

Business PlansBy the Numbers

Business Planning By the Numbers

Mark Lieberman

Get the Most For Your BUSINESS

Here is what SCORE offers to youFree of CHARGE:

*A confidential, business counseling session with a SCORE volunteer counselor who has the business experience you seek to address your questions.

*An assignment to help you think through your business challenge or opportunity and a follow up appointment to be set at your first counseling session.

*Follow up from your SCORE business counselor or charter office, checking on your progress and offering additional assistance.

Chicago SCORE ChapterCiticorp. 500 W Madison Street, #1250

Chicago, Illinois 60661312 353-7724

Mark LiebermanMark Liebermanmark.lieberman0mark.lieberman0

1@gmail.com1@gmail.com

Business Planning Addresses To Remember•Me: mark.lieberman01@scorevolunteer.org http://www.Linkedin/In/LiebermanMark•Score Chicago: scorechicago.org•Score National: score.org

Today’s Topic

Business Plan, what? why? when? who? how?Elements of good Business Plan Brief descriptions of each of elements How to write one?Common mistakes to avoid

Myth #1

Myth: All I need is a good idea to be a successful entrepreneur.

Reality: A good idea is a great start, but it takes hard work, research, and planning plus successful implementation strategies to turn your idea into a profitable enterprise.

You Need A Business Plan Unless You Are Talking to One of the 3 F’s

Business Plan is a Process

Simple

Specific

Realistic

Complete

RESULTS

ACTIONPLAN

FOLLOW UP

One Plan: Many Uses

Business Plan

Laboratory

PromotionPromotion

MotivatorElevatorSpeech

Typical Business Plan Outline

1.0 Executive Summary2.0 Company Summary3.0 Products (or Services or both)4.0 Market Analysis Summary5.0 Strategy and Implementation Summary6.0 Company’s Organization7.0 Financial Plan

7.0 Financial Plan

What is the Goal of the Financials?

Balance Sheet Shows The Financial Position of a Firm

The Income Statement Shows the Performance of a Firm Over Some

Period

The Cash Flow Statement Gives Insight How Cash Has Been

Generated and Used Over the Period

How They Relate to Each Other

If That’s the Goal, How Do I Get There?

You can get there this way …

But there is a better way

What the SCORE Template Contains

Purpose Tab Number

Use

Introduction None Documentation and Company Name

Input 1 - 6 Basic Expenses, Sales Forecast, Cash Flow Controls

Financials 8 - 17 3 years of Income Statements, Balance Sheets and Cash Flow Statements

Miscellaneous 18- 21 Reasonableness Checks and Break Even Analysis

Your Worksheets

? Your own custom worksheets; scratch area

Don’t look for tab 7. It’s there but it’s hidden and unused. Tabs 1 – 6 are where you’ll spend most of your time. Your thought goes here. Tabs 8 to 17 are protected. They are read only. Your payoff is here.Tabs 18 – 21 may or may not be useful.

What to remember about

Introduction (0)Here’s where you will enter your company name. That name will carry through to all future statements. The Introduction also contains some documentation on color codes.

What to remember about

Sales Forecast (4 and 5)•Although this isn’t the order in which they appear, work on 4 and 5 before any others. They should be where you spend most of your time and thought.

•Try to confine yourself to 4 or fewer products or product groups.

•If your business is seasonal, make sure you reflect that pattern in the sales forecast. Almost certainly, you won’t begin in January so change the time buckets here to align with your actual start date. The change will carry though all other slides.

•If you use a supporting sheet, link to it.

What to remember about

Fixed Operating Expenses(3)•Use the Expense captions as a start, but over key them with better captions if you need them.

•At first, you won’t know these. Take a guess, and refine the guess as you learn more about the business.

•Don’t key in Other Expenses. They come from the Amortization Schedule (20) which in turn comes from Required State Up Funds (1).

•This amortizes all annual expenses equally over 12 months. If that is inappropriate, you’ll have to modify the Income Statements (8,12, and 15).

What to remember about

Salaries and Wages (2)•Be honest. Are you going to pay yourself during the first year?

•The spreadsheet will amortize pay and contractors evenly across all months. If that isn’t true, you will need to do some changes to the spreadsheet.

•Estimate average wages for full and part time employees if you have them.

•Contractors who work for you full time aren’t contractors. They are employees. Treat them correctly.

What to remember about

Start Up Funds (1)•You probably won’t know all this when you start so put in estimates you revise as you go. Over key inappropriate captions, but be sure the total are correct.

•Fixed assets will be automatically depreciated.

•Sources of funding will be repaid as appropriate using the Amortization Schedule.

•Don’t be afraid to change your estimates based on what you see in the Cash Flow statements. Cash flow balances may never be negative.

Remember Only You Can Make the Business Plan

Volunteers for Business Plan Boot Camp?

Requirements

•Know Excel or equivalent

•Need to get done in 4 to 6 weeks

•Serious about a business plan

•Ready to work hard to complete financials