Financial Plan - Help

Creating a financial plan

Along with the text part, the financial plan is the heart of a business plan. As a registered founder, you can use the web-based financial planner in the Gründerwerkstatt free of charge to work out the figures. Use it to determine your capital requirements, calculate the start-up costs, and create a liquidity plan and an income statement.

Content of the financial plan

When you create the financial plan, it is best to proceed step by step:

Private financial requirements

A list of the total private income and expenditure shows you how much you have to earn with the project to secure your livelihood. Enter your private income and expenses in the spreadsheet. This is how you calculate your required private withdrawal.

Capital requirements and financing

Solid capital requirements planning is the basis for the establishment of every company. You should therefore first clarify how much money you need for:

  • investments such as land, buildings, equipment, machinery, vehicles, etc.
  • first warehouse, raw materials, consumables and supplies
  • start-up expenses such as notary fees and other fees, introductory advertising
  • operating materials, e.g. start-up costs
  • Your private requirements in the first phase of the foundation, which are not yet covered by revenues.

After determining the capital requirements, you should consider which building blocks are suitable for financing the project. The decisive basis for this are your own funds. They should be available at an adequate amount to ensure sound and crisis-proof financing.

Capital requirements should be financed through equity and/or longer-term foreign capital (bank loans, public-sector loans). Check whether favourable state financial assistance (loans, grants, guarantees) can be used. On the basis of the liquidity planning you can determine whether you require a short-term credit line.

Profitability

One of the most important, but probably also most difficult calculations in the context of start-up planning is the sales and earnings forecast (profitability forecast). Even if such a prognosis is naturally fraught with uncertainties, you must try to assess the chances of success of the services offered as realistically as possible. For the necessary preliminary work, i.e. the determination of the market potential as well as competition and location analysis, you can draw on your own experiences or also consult experienced specialists (management consultants, accountants, acquaintances with industry knowledge etc.). For certain sectors, e.g. the retail trade, inter-company comparison results are available which can provide clues for your own planning. Some of these are publicly available or can be obtained from the chambers of commerce and professional associations. You should ensure that business expectations match individual operational capabilities. Be sure to think about realistic quantities (number of billable hours, number of products sold, etc.) and achievable prices. Ask yourself at what prices competitors offer similar products or services. Important: Document your assumptions about quantities and prices so that you can understand the planning at a later stage and explain it to banks, for example.

If the standard of living is to be maintained and at least as much income is to be generated as has previously been earned as an employee, the profit, depending on marital status and personal tax burden, must be up to 50 percent higher than the previous gross salary, because entrepreneurs have to bear all social security contributions such as pension insurance and health insurance on their own. Note that the profits not only secure your livelihood, but also enable the company to repay its debt and maintain its substance or to grow appropriately.

Liquidity planning

A well-founded liquidity forecast indicates solvency for a certain period of time. The expected revenues are to be compared with the expenditures (monthly and quarterly overview).

This cash flow statement gives you an overview of all incoming and outgoing payments including value added tax (VAT) as well as the resulting liquidity situation at the turn of the month (“account statement of the future”). Please first create the profitability plan, as many values will then come about almost by themselves! The following generally applies: Current account overdraft facilities to bridge liquidity gaps should only be used for short periods!

Note that possible redemption payments that are not entered in the profitability planning must still be taken into account in liquidity planning (profitability planning only includes the interest payments).

Include a buffer in your liquidity planning, as liquidity problems could arise otherwise. A sufficient reserve for private subsistence must be included.