Business Plan – Part 4

Financial Analysis of the Business

List all of your fixed, variable and startup costs

Type / OMR

Explanation of costs

I will need[ explain your startup costs like equipment, furniture, ect ] ……………..

[ Explain you staff and their salaries] .

The office will require [ furniture needed to your business ]

My product / service will cost …….. O.R. per unit and I will sell by ……. O.R.

My product / service will reach customers by …………………

Projected cash flow

Example [ This monthly cash flow chart assumes I will have no sales for the first two months while the software is completed, and the web site is created. In month …... I expect to stat sales . My website is expected to attract some orders over the rest of the year.

Month / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8 / 9 / 10 / 11 / 12
Labor costs
Office costs
Start up costs
Other costs
C.O.G.S.
Total costs
Revenue
Profit/(loss)
Yearly profit/(loss)

Labor costs include …………………………..

Office costs include rental (………. O.R.), phone (…….. O.R.), email (……….O.R.)and web hosting (………..O.R.).

Start up costs consists of ………. (…….. O.R.), office furniture (……….. O.R.), and computer purchase (……… O.R.).

Promotion and advertisement costs include printing brochures, and ………………………

Cost of Goods Sold (COGS) includes the cost of ………………………………………………………………………………………... I assume sales of ………….units / services each month for total monthly cost of …………. O.R. (……… O.R. X ………..units)

Sales assumes…………….. Units sold each month for ………… O.R. each for a total of ……………. O.R.

While the business starts having profitable months in month ………….., total figures for the year will not turn profitable until month ………………………………..

Break Even Analysis

Fixed costs include one year of ………………………………………………………………………….. costs. This totals to ………………….. (…………………….labor costs (………… * 12 months) + ……………….. office costs (……….. * 12 months) + …………start up costs + ………………..other costs)

Variable costs are the ………………………………………………….My VC cost per unit is……………..

The selling price of my unit ……………………..So my profit on each sale is …………O.R.

So my breakeven point for sales is …………..units (explain the formula). If I sell ………….units, I will cover my first year fixed costs (break even).

Based on the information I gathered during my customer survey, I believe it will be very possible to sell more than ……………………units the first year and so turn a profit.

Financing my Business

My cash flow chart shows profit by month……………………………., butit is clear I will have substantial expenses at the beginning of my business year. I will need at least …………………….O.R. to get the business through the first three months. Additionally, I should have some contingency funding in case initial sales are less than ……… per month. Many things could go wrong. It might take more than two months to write the program. Or, purchasers may need extra time to get approval to buy the product or services by customers.

That would require startup capital of………………………..O.R.

I am going to finance this capital requirement from the following sources:-

  1. [ Explain the type of program / or support program/ amount or loan / interest or management fees / when to return it back / how you will return back the loan)

My loan application is being examined by …………………………. Unless my loan application is approved, I will not be able to launch my business.