Building a business financial plan is never easy. No matter the business goal, one thing that they have in common is that the goal has to be clear, measurable and achievable. Now, not all businesses need a financial planner, but no matter the scale, your business can definitely benefit from one.
As a small business owner, you will be expected to perform many roles. With your time tied up in other areas to market and run the business, mismanaging money is a mistake that you cannot afford to make. With a financial planner, you can use your time better. A financial planner can help you to set clear objectives and accurate projections based on their professional observations. They will provide you with timely insights with accordance to the current economic factors whilst analysing the risks involved and opportunities available. Especially for new businesses, this knowledge is crucial in helping to grow the business.
A financial planner can also prepare businesses for future developments and different stages of business growth. A common mistake that business owners do is not considering future projections and changes to the economy, technology and other circumstances. Expansion is one key aspect of a business, no matter if you are a brick-and-mortar store or an e-commerce platform. You may need to hire additional staff, buy a new piece of equipment or introduce a new product line and these involve careful planning and budgeting. Many businesses fail because they do not proactively prepare and plan for expansion. With a financial planner and a strong financial plan on hand, you will have the confidence to pursue opportunities that may not have been considered otherwise.
Speaking of future planning, one oversight that some business owners have is business succession planning. This involves long-term planning for transitions and replacements for positions of senior leadership in the company due to retirement, death or disability. The financial planner is able to guide the business owner and write a succession plan for your ideal successor including funding, shareholder and buy-sell agreements, taxation, life insurance policy and more. With proper business succession planning, you can be assured that the business will run well even when you are not around to lead it.
All in all, having a good business financial plan will keep you focused as the company grows or when new challenges arise. Speak to our trusted financial planners at EVOL today to build your business financial plan!