Whether a company can generate profits can be seen in the financial plan. This is the heart of the business plan and shows the founders the right direction by recording the most important points such as capital requirements or profit levels. Therefore, a financial plan is not only an important document for start- ups , but also for banks and investors – especially when it comes to applying for loans.
However, the importance of financial planning is often underestimated, with the result that serious errors creep into many financial plans, which in the worst case can mean the end of the business start -up. We show what mistakes are made and how they can be avoided.
1. Lack of financial plan
Arguably the worst mistake is not having a financial plan. Many entrepreneurs create a business plan , but often forget about financial planning or only approach it half-heartedly. To ensure that this contains all the essential points and that nothing is forgotten, a specialist , e.g. B. a business start-up consultant. Business start -up advice does not have to be expensive either, since there are subsidies that can reimburse up to 70% of the costs. (Service Tip: Find an Advisor )
2. Too optimistic sales planning
In particular, founders who are starting their own business for the first time are far too euphoric when it comes to financial planning. Accordingly, they run the risk of underestimating their capital requirements. In practice, this results in a liquidity bottleneck . Founders should therefore allow for buffers . Experience has shown that it takes up to nine months for the originally forecast sales figures to be reached.
3. Underestimation of marketing costs
Another mistake of many founders is that they assume that the customers will literally “run into the booth”. Although founders should be convinced of the success of their business idea, the creation of a marketing strategy and the planning of marketing costs must not be forgotten. Because in practice it is usually the case that after the start of the company foundation fewer customers can be won than originally planned. If the costs for customer acquisition were underestimated, the consequence is: Expensive marketing investments to win the missing customers after all. Business founders should therefore acquire a certain know-how in the field of marketing and sales.
4. Exceeding the financial budget due to unplanned investments
True to the motto “The unexpected often happens”, we are not only confronted with unforeseeable events in private life, for which we often have to dig deep into our pockets, such as e.g. B. the repair or even the purchase of a new washing machine. Even the business is not immune to unexpected events and the company quickly finds itself in difficulties . Investments often have to be made that were not foreseeable in advance. It is therefore important as an entrepreneur to put aside a nest egg for events like this in order not to be hit by nasty surprises.
5. Waiver of public financial assistance
Many small and medium-sized enterprises (SMEs) are critical of raising external capital because this can change the shareholder structure. Although this is understandable, it should not mean that a business start-up cannot be implemented due to a lack of capital. After all, business start-ups can seldom be raised using only one’s own funds. Fortunately, the state offers a wide range of funding and financing options . These range from raising equity to bank loans to various support programs. (Service tip: funding check )
6. Future scenarios are not played out
Business founders who are too sure of themselves often forget to consider the other side of the coin and to play through the “worst case”, i.e. the worst case of starting a business: What if, for example, B. the customers are missing or the venture capital providers are absent? Risks can be recognized and then prevented by these approaches.
7. Missing adjustments to planning in the event of changes
Another point concerns flexibility . Founders are dependent on various factors that can only be partially influenced or not at all. The current situation in particular shows us that we cannot control everything. It is therefore important for founders to throw their original plans overboard and be able to adapt their business to the circumstances as quickly as possible.
8. Incorrect calculation of employee costs
If the company is to employ employees, the costs for the employment are also included in the financial planning (gross wages and bonuses). However, it is often forgotten that employers also bear part of the social security contributions. These ancillary wage costs (external link) are then missing from the crucial financial plan. At the end of the month, the surprise for founders is correspondingly large. If you consider that between 23% and 33% have to be paid in addition to the gross salary, large amounts can quickly add up when there are several employees.
9. Not enough equity saved
Starting a business requires capital to grow. Especially at the beginning, start-ups have high costs, e.g. B. to carry office equipment or machines. Although there is the possibility of becoming self-employed with little equity, this usually only affects a few areas such as e.g. B. online trading. Basically, equity is required for a business start-up. Because without this, founders are quickly left dry. Loans from banks often burden the budget. Alternatives can therefore be raising equity-like mezzanine capital or applying for state subsidies.
10. Neglect of tax
This is one of the unwelcome topics of business founders. Most founders are aware that they will have to pay taxes at some point, but due to the complexity of the calculations, they are often missing from the financial plan. The consequence can be expensive additional tax payments, which in the worst case can mean the end of the business start- up. To be on the safe side, this topic should be put in the hands of a tax advisor . This can enlighten founders and protect them from serious missteps.