FINANCE
The importance of business plans
A business plan is a summary of the aims of your business and how you are going to achieve them. The more time and effort you put into planning before you actually start will massively improve your chances of success.
A business plan is a summary of the aims of your business and how you are going to achieve them.
The more time and effort you put into planning before you actually start will massively improve your chances of success.
The level of detail that you need is dependent on the size and complexity of what you intend to do. You might make one for your own guidance or you might have to produce detailed projections of profit and cash flow for a bank or business loan. And, it goes without saying that you should involve your accountant in this process.
Planning around cash is very important. Remember, it is possible to have lots of orders, be very busy, and then run out of cash because customers don’ t pay you on time.
Once you are up and running you should monitor your actual results against your plan. The standard method is to produce monthly or quarterly management accounts. These will show you where you stand and help you decide on actions to take to keep your plan on track. You should modify your plan to take account of changing conditions.
Some questions to ask yourself when you are starting a business are:
• What are you going to sell- describe the product / service?
• Who are your potential customers?
• Who are your competitors?
• How much demand is there for your new business?
• Do you need business premises?
• Could you save money and minimise risk by starting at home?
• Do you need staff and how many?
• Include marketing costs. In summary Create a plan to help you clarify what you want and how to achieve it. Monitor your plan and measure profitability and deadlines to ensure you are on the right track. Forecasting and monitoring cash flow is essential for the wellbeing of any enterprise.
Revisit the plan if you want to develop a new product or service.
Peter Bromiley ACA, partner at AMS Accountancy
@ AMSAccountancy
RFS included in 1000 Companies to Inspire Britain list
Swindon-based Regulatory Finance Solutions( RFS), the financial services compliance consultancy has been included in the 1000 Companies to Inspire Britain list.
1000 Companies to Inspire is the London Stock Exchange Group’ s celebration of some of the fastest growing and most dynamic small and medium-sized enterprises( SMEs) in the UK. In its fourth year, the annual publication also examines the opportunities and challenges facing SMEs and investigates the trends and sectors that will shape the future of British economies.
Companies featured within the 1000 Companies to Inspire Britain are considered the lifeblood of the UK economy.
Within the 1000 companies listed, 119 organisations represented the South West region. The report lists companies within a 49-sector-title that includes Leisure, Retail, Healthcare, to Legal and Accounting; with a revenue band from £ 20m to £ 125million.
RFS was one of 82 companies from the financial services sector listed within the 2017 report and one of four professional services firms based in South West England.
John Turner, chief executive of RFS said:“ It’ s a real milestone to be recognised by the London Stock Market as one of the top 1000 Companies to Inspire Britain. As RFS continues to enjoy an exceptional growth rate, we have reinforced our strategic team to drive forward scale-up opportunities to ensure we remain leaders within our field.”
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How can I know what affects my tax position and what to change?
See your accountant ANNUALLY to plan going forward and find tax efficient ways to pay money out from your business.
New tax rates and laws. Tax rates and allowances change annually and, for example, from April 2016, new calculations have been required to minimise the impact of the new dividend tax which will affect the higher salary levels( for director / shareholders), ownership changes, and pension strategy.
Retirement plans. If it’ s roughly known when a business will cease / be sold, it may benefit the owners to reduce regular payments as income and plan to take monies out as Capital( and pay Capital Gains Tax) at the closure / sale of the business.
VAT. If the type of customer changes, say, from retail customers to other businesses,( or vice versa), then consider voluntary VAT registration / deregistration.
Peter Bromiley ACA
60 + videos on YouTube.‘ Ask AMS Accountancy’ @ AMSAccountancy www. ams-accountancy. co. uk
12 THE BUSINESS EXCHANGE 2017