An important part of any business plan is your company's financial projections. Financial projections can help you identify any financial needs and can help you monitor your cash flow. Here are some steps for helping you make early financial projections for your small business:
- Plan—It's important to plan out different situations and the financial impacts of each of them. If you have planned for all possible situations — good and bad — then chances are you will be prepared for any event that may occur.
- Create—As you work on your business plan, go ahead and create your sales projection. You will need to list out the expenses needed to operate your business and your costs for beginning your business, as well. It is always a good idea to create a cash flow statement for your business to show you exactly how your business's money is spent.
- Track—Once you're up and running, continue to track your business's finances. Compare your finances against your financial projections to see if you are on track or if you may need to adjust your business operations.