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Again, the work and research you’ve already done for previous sections of your business plan will be invaluable here in making the assumptions needed to put your projections together.Include projected income statements, balance sheets, and cash flow statements, which we described above, along with a capital expenditure budget.If you’re looking for financing, you’ll probably have to show personal income tax returns for the last few years.
You won’t actually know until you sit down and work up the numbers.
As a startup, spelling out your sales projections for the future will help you closely examine your business model and costs, how you’ll allocate your resources, and figure out whether you actually do have a viable idea.
If you’re a startup, you obviously won’t have any previous financial information for the company, so many lenders will want to see your financial information in lieu of, or in addition to, your business financials.
Spell out how much money you’re investing in the business, along with specifics about the assets you plan to use.
You’ll need income statements, balance sheets, cash flow statements, and tax returns.
Income statements document how much money you’ve taken in for the business, where the money came from, what your expenses were, and your net income, or how much you wound up with after paying all the expenses.
They want to understand the thought process behind your numbers and why you’ve made those assumptions.
This means you need to do a significant amount of planning before sitting down to work on your projections, critically thinking through different scenarios.
It’s where you support the numbers you put together in your sales and marketing plan, and demonstrate why you’re a good investment.
In this section, you’ll take all of the marketing, sales, and product information you’ve amassed, and show how they translate into dollars. There are two parts to the financial component of a business plan: historical data and prospective data.