"If you fail to plan, then you are planning to fail"
A good accountant can tell you the meaning behind the statements that they produce. A great accountant can help your business do better by helping to plan for your business' success.
Regardless of what stage your business is at we can help you with your business planning. If you're planning a new business or partnership we can look at your business and come up with a financial plan. If you own a mature business we can help you plan for profits by looking at your cash flow, inventory, capital, and tax issues. When you are ready to retire, pass the business on to family, or sell your business there are some tax issues and other business issues you need to plan for and we can help with succession planning. Call us today to set up a consultation about how we can help plan for your business' success.
According to Industry Canada statistics only 51% of new businesses with less than 250 employees will survive for 5 years. In their Key Small Business Statistics report of July 2011, they also state that 85% will last for 1 year, and 70% for 2 years. What do you need to do to be on the successful side of those figures?
If you’re thinking of starting a business you’ve already got your idea, your product or your service worked out. Has this been researched (not just with your family and friends)? It can be informative and revealing to look at small business statistics for your industry. Take a critical look at similar businesses and think about what is good about how they operate. Can you see anything that could be improved? If this is your first foray into business, a mentor can be a wonderful asset.
Develop a business plan. This is probably the most important step for building a new business. It’s importance is too often underestimated. Your plan needs to include details (not just rough ideas!) on the following questions:
· What structure will you use for the business?
· Will you need any licences or permits?
· Where will you operate from?
· What equipment do you need to start with?
· How much stock will you need?
· Where can you source the equipment and stock you need?
· Do you need to hire staff?
· What employment standards will apply?
· What are the human resources, taxation and legal requirements?
· What insurance will you need?
· How much money do you need for the start-up?
· Where will you get finance?
Answering all these questions just gets the door open on your business. A business plan that gives you the edge on survival should also include a budget and cash flow projection for at least the first year of operation.
Your budget will include all your start up costs, then your regular expenses such as rent, power, telephone, insurance, stock and payroll. Income will be based on estimations. At this point it is extremely important to be conservative rather than optimistic.
A cash flow projection allows you to see where there are likely to be periods where your expenses outweigh your income. The expenses still have to met, but if you anticipate the shortfall in income you can plan other ways to ensure the money is there when the bills come in. The cash flow can also be very instructive so you know how much income you need for the business to be successful.
Your business plan, budget and cash flow projection will be essential if you are looking for finance. This is where professional assistance can be invaluable. It is an investment in the future of your business.
A good plan is critical to the survival of your business. It means you go into the enterprise with your eyes wide open. There may still be some surprises along the way, but you will be in a much better position to deal with them. Starting without a good plan is really just making it up as you go along. As Benjamin Franklin said “If you fail to plan, then you are planning to fail”.
If you’re starting your research into a new business, developing a plan for a new business or updating your existing business plan, we can help. If you’ve already started your business and don’t have a plan, it’s never too late to get started. Call the office and make an appointment.
More information can be found on the Industry Canada website:
Farming businesses are not eligible under this program. Agriculture and Agri-Food Canada has a similar program for the farming industry. For information visit their website at http://www.agr.gc.ca