Creating a financial plan for the upcoming period takes time, and we know that reality changes slightly each month. So, what are some good reasons to invest time in this task?
- A business plan includes insights into expected income and expenses, resulting in a cash flow forecast. Even if cash isn’t a bottleneck, it’s useful to know your expected bank balance each month, especially if there are seasonal fluctuations.
- You can inform different departments in the organization about monthly objectives, allowing them to align purchasing, production, and sales accordingly. It also gives them a better understanding of when to expand or, in a negative case, reduce their team.
- If a new investor is involved or the organization is being prepared for sale, the new investor or buyer will want to see a business plan.
- When applying for a loan or business credit, the financier will ask for a business plan.
Smartbooks ensures that the business plan is not just an Excel model, but is recorded in the system. This way, changes in assumptions are immediately recalculated in Smartbooks, keeping the comparison with current figures and the forecast always up-to-date.