| Preparing a sound, bootstrap business financial plan is | | | | success to a large degree. |
| the absolute key ingredient for any budding | | | | 6. Balance Sheet |
| entrepreneur starting a small business with bootstrap | | | | A balance sheet provides a good overall picture of |
| financing. Unlike a traditional business plan, a financial | | | | what your business is actually worth. It takes your |
| plan for a bootstrapped business contains six essential | | | | assets (physical goods like equipment or property) |
| components. | | | | minus your liabilities (debts owed to creditors) and |
| Components of a Successful Bootstrap Finance Plan | | | | gives you the equity value of your business. |
| 1. Expense Summary | | | | What makes these components different from what |
| The expense summary contains the start-up costs | | | | you would prepare for a business plan written for |
| and ongoing operating expenses needed to get your | | | | bank financing? Well, the main difference is that this |
| business up and running. | | | | plan is just for you. It is an actual plan that you must |
| 2. Projected Profit & Loss Summary | | | | follow to achieve success in your business. I have |
| Your profit and loss summary is a key tool for | | | | seen far too many instances where a traditional |
| determining how long it will take your business to | | | | business plan is almost completely ignored, once the |
| become profitable. It reflects a very simple formula of: | | | | bank loan check is cashed. |
| revenues minus expenses, equals profit or loss. | | | | With over one third of brand new businesses failing in |
| 3. Sales Forecast Summary | | | | their first year of operation, you owe it to yourself to |
| Your sales forecast summary is an estimation of what | | | | minimize your start up risk, by being well prepared with |
| you believe your sales are likely to be each month. | | | | a sound financial plan. |
| Sales forecasting requires research and a solid | | | | Where Does a Bootstrapped Business Plan Fit In? |
| knowledge of your industry, niche market and product | | | | Where does a bootstrap business financial plan fit in? |
| or service. | | | | Well, first you must understand bootstrap financing. |
| Starting a small business with bootstrap financing | | | | Starting a small business without borrowing is the |
| requires laser targeted forecasting. This is not as | | | | ultimate goal of a bootstrapped business' financing |
| difficult as it sounds, it just means you must really | | | | strategy. Many new entrepreneurs just don't realize |
| invest the time in thoroughly researching your business. | | | | that you can start up a business, even if you have |
| 4. Reserve Funding Plan | | | | very little money, poor credit or don't own a home. |
| Establishing a reserve funding plan is essential for | | | | How is this possible? I know that I'm going against |
| weathering the "start-up storms". This is a back up | | | | conventional wisdom here, but you really can start up |
| funding plan for keeping your cash flows above | | | | a brand new business without BIG bank loans or a |
| dangerous levels. Your bootstrap business financial | | | | stockpile of cash. |
| plan must include a reserve funding plan, in order for | | | | Find the free sources of business start up funding your |
| your new venture to be successful. | | | | new business needs to survive and thrive. Start by |
| 5. Cash Flow Management Plan | | | | claiming your free copy of The Bootstrapper's |
| This is simply the anticipated inflow (sales) and outflow | | | | Business Start-up Planner, by visiting my website. |
| (expenses) of cash through your business by month. | | | | ©2009 Kimberly Kelly - All Rights Reserved |
| Why it's so tricky is due to the fact that you may have | | | | Worldwide. |
| slow sales or no sales when you're just getting started. | | | | Permission to reprint this article is granted strictly on |
| Or, perhaps your customers are not paying within | | | | the condition that it be reprinted in its entirety, with all |
| terms. Even if you have great sales on paper, your | | | | live links and author bio in tact. |
| cash flow management plan will determine your | | | | |