Overview
In the Financials section of your business plan, make your explicit case for the potential profitability of your business venture. The financial plan is a set of projections that reflect your company's anticipated financial performance. This is arguably the single most important section of the business plan—and one you must be prepared to support, adjust, and refine as you move your business idea through the business lifecycle. In this section of the business plan, you're asking your reader to believe with his wallet.
The format of this section of a business plan is not particularly flexible. Every business plan contains similar statements or schedules and each statement is presented in a conventional manner. Seek the resources or assistance you need to make sure you construct these financial statements appropriately.
The Financials section of your business plan should include:
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An introduction that presents a clear and concise set of assumptions on which financial projections are based.
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Projected income statements spanning three to five years that reflect monthly or quarterly performance for the first year, and annual statements thereafter.
- Projected cash flow statements for the first two years, developed with as much detail as possible, and quarterly or annual cash flows, corresponding to the period used for the income statements, over a three to five year time span.
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