Realistic business planning with limited finances

Every enterprise needs a business plan to control all parts of the business. It also sets how the business will grow. Consider the following:

• A business plan is vital if you want to borrow money. It shows what you plan to do, how you will spend the money, and how you will repay the money - see how to write a business plan: step-by-step.
• You should make a cashflow forecast. It will show how much money is going out of and coming into the business. When you're starting up a business you'll have limited resources of cash, so it's important to keep a close check on the money - see cashflow management.
• Trade within your capabilities - many businesses built with good products and a long list of customers fail because they simply run out of cash. This is called overtrading. Such opportunities, like buying in bulk and saving on delivery costs, can be attractive once your business is thriving. However, in the early stages, don't be tempted to spend large amounts of money in this way - see avoid the problems of overtrading.
• Update your business plan regularly. This means having a clear vision of where you want the business to go. It will help you keep better control of the business and its finances.