Financial planning for new business owners

Financial planning is crucial in determining the success of your business. If you’re not on top of your finances, how is the business going to survive?

In this post we explain the basics of financial planning for new businesses.

What is financial planning?

There are 3 elements to financial planning: 

1. Setting goals
2. Identifying risks
3. Budgeting

Setting goals

Think about what you want to accomplish in the short, medium and long-term. 

Next think about what you can do in the next year to work towards your overarching aims.

Identifying clear goals for the next 12 months will help focus your efforts and set you on the way to achieving your longer-term goals.

Risks

Identify the threats to your business and put plans in place to overcome them. Areas to focus on include your:

• suppliers
• client base
• staff.

Budgeting

Budgets are drawn up each financial year and will contain information on estimated sales and costs.

There are 3 key budget plans, these include:

• forecast– where estimated figures are prepared and adjusted once actual figures are collected
• performance budget – estimates of upcoming revenue and expenses
• cash budget – how cash will be spent, predicting future expenditures and receipts for a specific time period.

Talk to us

We can bring you reassurance and peace of mind in formulating your business and financial plans. Speak to an adviser today to find out how we can help your business.