Video
Part 3: Thinking about your financial situation Wāhanga 3: Te whakaaro mō tō āhuatanga ā-pūtea
To succeed in business, you need to manage your assets and know when and how your money comes and goes. Learn how to follow the relevant rules and plan for surprises too, so that your business can continue to operate.
Transcript
Video transcript: Thinking about your financial situation
[Audio/ Visual: Gentle music starts playing with blue introduction screen with white business.govt.nz logo in the centre of the screen. The word “presents” in smaller, thinner lettering is beneath the logo. These words disappear and are replaced with white text “How to prepare a business plan”. This disappears. White text saying “Thinking about your financial situation, keeping your business going and compliance” appears in the centre of the screen. Music continues to play throughout the entire video.]
[Visual: The screen changes to a shot of the presenter, seated in a home office. In the bottom right is the business.govt.nz logo which remains there until the end of the video.]
Welcome to our last video on how to prepare a business plan.
[Visual: The words “Download our template” and url “www.business.govt.nz/businessplan” appear on screen with an animated download icon. All disappear after a few seconds.]
In this video, we’ll discuss four topics: assets, financial planning, business continuity and compliance.
[Visual: As the presenter speaks, text appears as a list on the left side of screen with the words;
“Assets
Financial planning
Business continuity
Compliance”]
[Visual: The screen changes to a shot of stationery on a coffee table. The white text “Assets” pops up in the centre of the screen.]
Let’s start with assets.
[Visual: The screen cuts to a shot of the “Assets held and planned” page of the Business Plan Template is shown on screen, page 16. The template enlarges to full screen and the words “Assets held and planned”, “Asset” and “Replacement/maintenance strategy” are highlighted in yellow as the presenter speaks.]
An asset is anything that’s valuable and creates value. List your assets. Think about how you’re using them, and how you’ll maintain and replace them.
[Visual: The screen cuts to a shot of the presenter, seated in a home office.]
Here are some examples of assets and things to think about.
[Visual: A blue background fades up, the bold white text that says, “Business premises” and white icons of a desk work station, shop front and tools appear on screen as the presenter speaks.]
Business premises – like an office, a shop, or a workshop you own.
[Visual: The blue background stays in place. The screen changes to show bold white text that says, “IT” and white icons of a mobile phone, computer monitor and server appear on screen as the presenter speaks and stay in place. Underneath the text “IT” the words “What do you need and how will you manage it?” appear in smaller thinner white text.]
IT – like phones, computers and servers. What do you need and how will you manage it?
[Visual: The screen changes to show bold white text that says, “Equipment” and white icons of a toolbox, excavator and truck appear on screen as the presenter speaks and stay in place. Underneath the text “Equipment” the words “What do you need and how will you maintain it?” appear in smaller thinner white text and then disappears. Underneath the text “Equipment” the words “Are you better off owning or leasing?” appear in smaller thinner white text.]
Equipment – like tools, machinery and vehicles. What do you need and how will you maintain it? Are you better off owning or leasing?
[Visual: The screen changes to show bold white text that says, “Stock” and white icons of a cardboard box, warehouse and moving truck appear on screen as the presenter speaks and stay in place. Underneath the text “Stock” the words “Where do you store them?” appear in smaller thinner white text and then disappears. Underneath the text “Stock” the words “How do you keep track of them and ship them?” appear in smaller thinner white text.]
Stock – goods that are ready for sale. Where do you store them? How do you keep track of them and ship them?
[Visual: The screen changes to show bold white text that says, “Intellectual Property (IP)” and white icons of a tag, question mark inside of speech bubble and pencil writing on paper appear on screen as the presenter speaks and stay in place. Underneath the text “Intellectual Property (IP)” the words “What have you developed that you wouldn’t want copied?” appear in smaller thinner white text and then disappears. Underneath the text “Intellectual Property (IP)” the words “How are you protecting it?” appear in smaller thinner white text.]
Intellectual property, often called IP – like branding, trade secrets and designs. What have you developed that you wouldn’t want someone to copy? How are you protecting it?
[Visual: The screen changes to a shot of stationery on a coffee table. The text “Financial planning” pops up on the screen.]
The next section is about financial planning. Be as accurate as you can.
[Visual: The screen cuts to a shot of the presenter, seated in a home office.]
If you’re too optimistic, you may end up spending more than you earn.
[Visual: The screen pans across to show the presenter on the left-hand side of the screen and the “Financial plan” page of the Business Plan Template on the right side of screen, page 19. The words “Cost forecast – money out” are highlighted in yellow as the presenter speaks.]
Let’s start with costs. You may be able to google some costs, -
[Visual: The screen pans across to show the presenter in the centre of the screen and the “Financial plan” page of the Business Plan Template disappears.]
but it’s best to talk to suppliers or find out from similar businesses.
[Visual: The screen zooms in to show the presenter at a slightly closer angle.]
Go into as much detail as you can. For example, if you have staff, don’t forget costs like overtime costs, ACC levies, and KiwiSaver contributions.
[Visual: As the presenter speaks, text appears as a list on the left side of screen with the words;
“Overtime costs
ACC levies
KiwiSaver contributions
Interest payments”]
If you have a loan, don’t forget interest payments.
[Visual: The text list disappears from screen. The screen zooms out to show the presenter at a slightly wider angle on the left-hand side of the screen and the “Revenue forecast” page of the Business Plan Template is shown on the right side of screen, page 20. The words “Revenue forecast – money in” words are highlighted in yellow as the presenter speaks.]
Think about revenue too. Money you get for your product or service will be revenue, -
[Visual: The screen changes to show the presenter at a closer angle in the centre of the screen and the “Revenue forecast” page of the Business Plan Template disappears.]
but you may have other types of revenue like bank interest. If you get funding like grants or investments, include that too.
[Visual: As the presenter speaks, text appears as a list on the left side of screen with the words;
“Bank interest
Grants
Investments”
Screen zooms out to show the presenter at a slightly wider angle.]
You’ll need to know your costs and revenue before you can forecast how well your business will do.
[Visual: As the presenter speaks, text appears as a list on the left side of screen with the words;
“Costs
Revenue”]
Our template covers four forecasts:
[Visual: The text list disappears from screen. The screen zooms in to show the presenter at a slightly closer angle on the left-hand side of the screen and the “Break-even forecast” page of the Business Plan Template is shown on the right side of screen, page 20. The words “Break-even forecast” are highlighted in yellow as the presenter speaks.]
A breakeven forecast estimates when costs will equal revenue, and a business starts to make money.
[Visual: The “Break-even forecast” page is replaced with the “Profit and loss forecast” page of the Business Plan Template, which is shown on the right side of screen, page 21. The words “Profit and loss forecast” are highlighted in yellow as the presenter speaks.]
A profit and loss forecast estimates how much profit or loss you’re likely to make.
[Visual: The “Profit and loss forecast” page is replaced with the “Cash flow forecast” page of the Business Plan Template, which is shown on the right side of screen, page 21. The words “Cash flow forecast” are highlighted in yellow as the presenter speaks.]
A cashflow forecast looks at the pattern of money going into and out of your business over time.
[Visual: The “Cash flow forecast” page is replaced with the “Balance sheet forecast” page of the Business Plan Template, which is shown on the right side of screen, page 22. The words “Balance sheet forecast” are highlighted in yellow as the presenter speaks.]
A balance sheet is a table showing what your business owns and what your business owes. A balance sheet forecast is an estimate of that table for each of the next few years.
[Visual: The screen changes to a shot of stationery on a coffee table. The white text “Business continuity planning” pops up on the screen.]
Our second-to-last section is about business continuity planning,
[Visual: The screen cuts to a shot of the presenter, seated in a home office.]
how you’ll keep going if the unexpected happens. Something will happen sooner or later, no matter how optimistic you are or how well you run your business. Vital equipment could breakdown in a factory, two or three key people could suddenly become unavailable in a small consulting firm, or a natural disaster could mean you can’t get to your customers.
[Visual: The screen pans across to show the presenter on the left-hand side of the screen and the “Business continuity planning” page of the Business Plan Template is shown on the right-hand side of the screen, page 23. The template enlarges to full screen with a blue background and the words “Risk” and “Systems, policies or tools to mitigate risk or deal with” are highlighted in yellow as the presenter speaks.]
List the likely risks and what you’ll do if they happen.
[Visual: The screen changes to a shot of stationery on a coffee table. The white text “Compliance” pops up on the screen. The screen cuts to a shot of the presenter, seated in a home office.]
Our last section is about compliance – following the necessary rules.
[Visual: The screen pans across to show the presenter on the left-hand side of the screen and the “Legal and regulatory compliance” page of the Business Plan Template is shown on the right-hand side of the screen, page 24. The template enlarges to full screen with a blue background and the words “applied for required licenses and permits” and “register as an employer” are highlighted in yellow as the presenter speaks.]
For example, if you produce food, you’ll need permits. If you have staff, you’ll need to register as an employer and carry out certain obligations.
[Visual: The screen cuts to a shot of the presenter, seated in a home office.]
If you have specialist equipment, it may need regular certification.
And that’s it. We’ve come to the end of our video series on how to prepare a business plan.
If you need more guidance, our website has plenty of useful advice for small businesses.
[Visual: The url “www.business.govt.nz” appears on the left of screen.]
Visit us at business.govt.nz.
All the best with your business plan!
[Visual: Blue outro screen appears with the business.govt.nz logo in the centre of the screen. This logo disappears and the Ministry of Business, Innovation, and Employment logo appears on the left-hand side and the Te Kāwanatanga o Aotearoa, New Zealand Government logo appears on the right-hand side.]
[Video ends]