[Fuzzy]

Just throwing this question into the pot

Are Business plans and cashflow forecasts essential ?
(Not for Fuzzy personally btw! - just in general)

[admagic]

Originally Posted by Fuzzy

Just throwing this question into the pot

Are Business plans and cashflow forecasts essential ?
(Not for Fuzzy personally btw! - just in general)

If you dont know where you are going.

How can you ever get there??

Ifyour business has debtors, creditors and so on?

How do you know how much cash you will need?

If you need to use other peoples money

How can you ever persuade them without?

But in the end

A plan and a forecast is the demarcation line, between a business and a hobby

[Maxine]

Yes I would say so even in a basic form for reasons admagic gives. I do think though that it is easy to spend ages going over the top on business plans (not me but have seen people do this) and spend more time doing this than going out and getting business!

Cashflow is one that a lot of people dont bother with which I guess is OK if you have loads of money in the bank and dont need to plan money in and money out

[SBP]

cashflow is THE critical element of a business

many a profitable business go bust because they run out of cash

[An Oasis]

For me Yes & No. Having run hobby businesses and the real thing. Hobby businesses are easy to control so need minimum effort, you can get away with everything being in your head.

However, once a business takes off without all the right systems in place you will end up going mad, losing money, losing opportunities, making bad purchase decisions...and it will affect your business in a detrimental way.

[Peter W]

Even if you don't need a business plan to borrow money from the bank, it is still useful to prepare one because it forces you to review and put down on paper where the business currently stands and where it is going.

As for a cashflow forecast - if money is tight, it is critical. Even if you have plenty of money sloshing about (a technical accountancy term ) in your business, a forecast is still useful so that you can work out how to invest that money.

[RayB]

I'd say that a business plan and cashflow forecast are essential business tools and disciplines.

Regarding the latter, "Cash is King" as the saying goes, and as others have said, many a sound business has failed through running out of cash

[boxby]

You can operate without them.
However, you can't grow your business, expand and develop without them.

[MSC]

Yes I agree with everything already said. It helps you to focus and understand the business more. Fuzzy I am guessing you are reluctant to sit down and spend the time doing it as you see it as a waste of time, and I know that feeling I would rather be creating, designing, planning, marketing, anything but sitting down working out a business plan and cashflow forecast.
However I looked at it as part of the designing, creating and planning and it really helped me focus. It basically involved me putting numbers and dates to the dreams, goals and vision I have for the business. I found that the numbers weren't actually that scary afterall, and it felt so good to know what sort of cold hard cash my airy fairy dreams could make!

[Fuzzy]

[quote=MSC;27332]Fuzzy I am guessing you are reluctant to sit down and spend the time doing it as you see it as a waste of time, and I know that feeling quote]
Noooo, I have done mine - yonks ago, this thread was just for newbies