Business plans are written for many reasons---to gather investors, to justify start up, to clarify operations. They can also be useful in justifying a new move in operations. A business plan can show investors and managers that certain investments and movements in inventory could increase revenue exponentially. Business plans for functioning and operating companies are slightly different than those of start-up business plans, requiring current statements in addition to pro forma statements. The primary objective of a functioning company's business plan is to prove the strong possibility of increased revenue due to a proposed change.
Instructions
1. Prepare current financial statements for the business, to include a profit-and-loss statement, a balance sheet and an income statement.
2. Analyze the current company equipment and prospective equipment, and draw factual conclusions. Illustrate these conclusions with concise, clear statements and strong, simple graphic organizers.
3. Emphasize cash flow. A common business plan mistake is to not place due emphasis on cash flow. Explain that current cash flow allows and will benefit from the expansion you suggest with the acquisition of new equipment.
4. Align your expansion priorities and results from the equipment acquisition with the company's mission in your business plan for the new equipment. Make it a very clear conclusion to the reader of the business plan that you're ensuring reasonable results with your proposed methodology---results they want.
Tags: business plan, cash flow
