May 2000 Archives

A Business plan is a tool which forces you into thinking and planning strategically. In doing so, it will force you to think through some tough issues such as:
Are you sure that what you are doing now, is taking you closer to where you want to be in the future?
Do you know what you want your business to look like in five or ten years time? If you don't think that is important, have you considered:

• Do you want to sell your business in the future or are you just trying to generate a source of income? The way you answer this will greatly impact the decisions you make and the way you run your business now going towards that goal.
• Are you aware of the things that you need to do now so that your company is in a saleable state in the future?
• Or alternatively, do you know whether your company will be able to generate sufficient income for your needs in five years time? By the time you realise the company is not generating sufficient income for you, its already too late. You need to plan ahead.

Jesus teaches that we should not store our treasure on earth, but store our treasure in heaven. "For where your treasure is, there your heart will be also" Matthew 6:19. How do we reconcile this with Solomon's wisdom concerning the wise storing choice food and oil quoted in part 1?

1. Understanding the nature of your costs

There are a number of good books and courses on costing some of which may take years to complete. The intention here is not to turn you into a costing expert but to help you put a practical and useful budget together. If you need a more technical document or model, you would be well advised to contact a professional.

In developing your business, it is vital that you know where you want to go and how you plan on getting there - your vision or purpose and strategic plan. This plan will include amongst other things, the financial implications of what you plan to do - what it will cost you and what income you anticipate it will generate. The estimating of these costs and income is your budget or financial plan.