Whether you’re applying for government subsidies, taking out a business loan, or seeking investor support, you need to be able to demonstrate your ongoing viability as a business.
To prove this viability, it’s important to have the right financial information at your fingertips. This information is also just as important for your own internal planning and decision-making.
So, where do you start, and what are the reports that you’ll need?
The Numbers that Prove You’re a Business with a Future
Any lender or government body wants to know that your business has a future.
As the owner, you may believe in the destiny of your company, but you also need the numbers to reinforce this argument. Banks, lenders, and investors are taking a risk in backing you. Because of this, they want to know that you’re capable of making the agreed repayments and that the business is in a financial position to deliver profits and payouts for investors.
Before investing in your business, organisations will want to see:
- Evidence of a healthy sales pipeline and sales revenue
- Manageable debt that’s not eating into your capital
- A positive cashflow position that covers your main costs
- Forecasts that show stability or growth in your revenues
- A meaningful business strategy for the next two to five years of growth
The Data You Need to Plan Your Future
You can’t run a business on a wing and a prayer. With so many different ways to track and record your business data, there’s no excuse for not being up to speed with your performance, your targets, and your forecasted sales, cash flow, debt, and profits.
This information isn’t just useful when approaching investors and lenders. It’s also vital for your own strategic thinking, your business planning, and your internal decision-making
Crucial management information to know will include:
- Your targets and budgets for the upcoming period
- Your sales and financial performance against these targets
- Your basic financial position and health
- Your forecasts for future sales, cashflow, and end profits