SPREADSHEET PROFITS – PRESS “CALC” & MAKE MONEY! – September ‘09

AS WE REVIEWED THE BUSINESS CASE FOR A NEW TERRITORY START UP, SOMEONE COMMENTED “FUNNY HOW WE ALWAYS MAKE A PROFIT IN THE SPREADSHEET”.

Perhaps the sceptical voice of experience had spoken, but what actually is the reality behind a comment like that? And what are the implications for how a business plan is put together?

The reality is that often the financial projection in a business plan reflects one or more traits that can make its credibility hard to go along with. These can include a poorly defined business model, broad assumptions, and over optimistic time scales, rounded off by the healthy desire to be successful.

We all agree with the last one – because we want success. The implication is that our chances are improved by clear thinking about how things happen, what absolutely must be achieved and, realistically, by when. It’s about understanding your markets.

It's far better to press “Calc” and say “This is what I can make happen and why”.