In the world of entrepreneurship, a solid financial plan is an indispensable tool that can make the difference between success and failure. A professionally prepared financial plan fulfills two essential functions: the operational function and the use for financing or capital increases. But why is a financial plan so crucial to the success of a company?

Operational function of a financial plan

A financial plan is not just a document for external investors or financial institutions; it also serves internally as an important control tool for management. By creating a financial model, clearly defined assumptions are made about the future development of the company. These assumptions serve as a basis for setting operational goals and monitoring the company's performance. Every financial model contains key performance indicators (KPIs) in the output, such as sales, which can be used to measure the company's performance and ensure that it stays on track.

Financing requirements and capital increases

A professional financial plan is particularly important when it comes to securing financing or capital increases. Investors and banks always want to understand how a company will develop in the future and what assumptions are underlying these forecasts. A detailed financial model provides this information and offers a clear insight into the company's financial health and future viability. It serves as a basis for decision-making and plays a key role in gaining the trust of potential investors.

Necessity also for established companies

Even for companies that are already established, a financial plan remains crucial. Such a plan makes it possible to present and vary the future development of the company based on clearly defined assumptions. By simulating various scenarios, the impact of potential changes in operations on the financial result can be analyzed and evaluated.

Individuality and uniqueness

Another important aspect is that every business plan and financial model is unique and should be tailored to the needs and specifics of each company. A professionally created financial model takes into account the company's specific drivers, such as sales and cost assumptions, and shows the relationship between these factors. In addition, the results are presented in a clear and attractive manner to enable clear strategic and operational financial planning.

Conclusion

A professional financial plan is an indispensable tool for the success of every company. It not only serves as a control tool for management, but is also crucial for securing financing and capital increases. Even established companies should not do without an up-to-date and well-thought-out financial plan in order to plan their future development and identify potential opportunities. An individually designed financial plan provides the basis for successful strategic and operational financial planning and makes a significant contribution to securing the long-term competitiveness and profitability of the company.