Financial planning: Foresighted to 3 years

Here, third parties can realistically understand which costs and revenues are planned by you as managing director in the first year, in the second year and in the third year. An assessment that goes even further would not be realistic in most cases, since the parameters are difficult to predict for such a long time. Therefore, banks and investors usually expect a 3-year plan from you.

Financial plan, that sounds for many first of all to something very difficult. But a financial plan is not that complex. In principle, it says how much you pay for your rent, personnel and equipment and how much you earn by selling it? Helpful tips: selling your home.

Rent, personnel, goods, etc.

It’s basically a simple calculation you make for 36 months. You start with an amount for each item (rent, staff, goods, etc.) and then rise month by month (away from seasonal fluctuations). As revenues rise, so do expenses, e.g. more square metres for the warehouse, more personnel for processing orders or more material and goods that need to be financed in advance.

From the financial plan a third person can understand now relatively fast your thoughts about sales and cost planning. This gives a potential financier or investor a quick and, above all, clear impression of the valuation.

Business Idea, Validation, Financial Planning

You’ve heard and learned a lot! You can see how many parameters are involved in setting up a company. Of course, at the beginning it is important that you pursue your goal without getting bogged down in details. As described above, the challenges will not be different, but greater. At some point you will have to deal with rental contracts or think about co-founders and investors, which will inevitably lead you to articles of association. Once the contracts have been signed, no further changes are possible. We continue with the office furnishings and, of course, details such as the quality of the technical equipment. From the modern and powerful notebook for the employee to the current smartphone model and the matching, low-cost mobile phone contract behind it. Beverage deliveries, HDMI monitor cable, cleaning service, tax consultant.

Caution is better than hindsight

All are relevant items that you need to consider in your financial planning. Financial planning is a roughly structured overview that documents the monthly progress of the largest expenditures and revenues. As the founder, you estimate the potential for the next three to five years. Accordingly, you must of course also consider the increase in turnover and the opposite increase in expenditure. The more products you sell, the more staff, space and pre-financing you will need.

Seasonal Variations

However, seasonal fluctuations are also visible in the financial plan. For example, if you are in the heating, sanitary and solar sectors, you have order peaks at certain cycles. Of course everyone wants to have his heating repaired shortly before the onset of winter. The same goes for the solar system, just before summer arrives. Accordingly, short-term order peaks arise, which must not only be covered by personnel, but also by preliminary investments, e.g. in material or cars for delivery and distribution of the teams on the individual construction sites. Not only our own staff, but also freelancers and temporary workers are involved when it comes to realising projects that exceed our own capacities. Accordingly, capital reserves must be available shortly before the order is placed.

Your financial planning is made exactly for such cases. Here you can, as well as potential financiers, e.g. banks or investors, from private individuals to business angels to venture capital, get an overview of what financial resources you need to spend and have ready.

How honest must a financial plan be?

I myself started completely without an investor and have always been the sole owner of my companies to this day – that’s why I didn’t need financial planning in the detailed sense until now. From my circle of acquaintances, however, I know that most figures in financial plans tend to be beautifuly calculated. The costs are low, the profits extremely high. Everyone estimates their profit at 2.3 million euros in the second or third year. Realistically one is happy (then) about 20.000 €.

Reminder, 90% of companies fail in the first five years. As a rule, of course, we only hear from successful companies. The ones who really managed to climb to 2.3 million in annual sales. Sure, it helps in the search for investors, because not everyone who has capital available is also clever. Many who have inherited their capital are not the brightest pears entrepreneurially. Accordingly, you can rely on great pitches in which someone tells you how many millions you will earn together. In small talk you talk about irrelevant things, not about business. Of course you can use this circumstance. The secret: Family business with a long tradition. There are often people on the executive floor who sit here because of happiness, not because of work or performance. Accordingly, of course, they don’t check numbers so accurately and like to be blinded by big speeches. A fact that one can of course also use for oneself as an entrepreneur, especially at the beginning. You have to knock on a lot of doors but at some point the first one or two people will be there to listen.

These are the basic thoughts on business idea and feasibility.

Guideline: Setting up your own business & business plan

You want to start your own business as a real estate agent or with another business idea? We support you with tips on your business plan and concept. Whether self-employed full-time or part-time self-employed: If you want to set up your own company, you have to think about a lot, in advance and in the operative business. From the right idea to health insurance – what needs to be considered if you want to become self-employed?

There is no training or further education for entrepreneurs. Managing director is you or not. Your own ambition is always important, because this is the only way to improve, every day.

The topics at a glance:

Exhibition: Presentation and trade audience

On the one hand, the acquisition costs for obtaining stand space. The next step is to compete with the other stands to attract visitors, which requires a stand builder. In addition there are the personnel, e.g. for the care of the guests. For presentations, conferences and congresses you have to plan a lot of time for the organisation. Depending on the location, e.g. in Berlin-Mitte, this can be very expensive. At the same time, the effect is great, because it’s worth it for prestige alone. The majority of these media measures are aimed at B2B professionals with large order volumes and budgets.

Presence is always important in advertising. The bigger your company, the broader your media portfolio will be. While you may start out with advertising on Facebook and Instagram for cost reasons, sooner or later you’ll be sure to be at trade shows and conventions. Maybe just like in TV commercials or trade journals. If you are preparing for a trade fair, the following points are particularly important:

• Exhibition stand
• Personnel and Service
• Objectives and Schedule
• Documents (Information until sale)
• Presentation media

Information, training, trade advertising

As with meals, conferences and congresses, this form of advertising is also aimed at a B2B audience. Here even much more than at trade fairs, because training courses and trade advertising usually take place among skilled personnel. If you are, for example, in the field of heating and sanitation, you could hold regular training sessions to discuss new fittings and designs, for example. If more and more non-contact bathroom and kitchen faucets are installed in the future (trend), specialist knowledge of the product must of course also be available. In addition to the water, there is also the electrical connection, maintenance and repairs. In addition, such training and further education courses have the advantage that they obviously do not look like advertising. Finally, there is free training and further education.

For companies, such training courses are also a free possibility of further training for employees. For you it is a possibility to bring your products or services into conversation. Through the practical application, the participants have a very high learning factor directly, because they are not only mentally present, but also motor, through example installations. All this solidifies the new product for the craftsman. At the next customer meeting, he or she will perhaps point out the advantages of the new, non-contact bathroom fitting. If he or she convinces the customer, everyone benefits. The craftsman’s workshop earns a few extra euros thanks to the exclusive fittings. You won another customer. The customer has an excellent, non-contact bathroom fitting.

Ideally, the new building should not only be equipped with one fitting, but also directly with several fittings on several floors. So you have ensured by the concept of a training and further training for advertisement, directly with the specialized public, direct hit. Of course this is not only possible for B2B customers. From a golf taster course to a Tupperware party. This also brings us to the sales talk, live marketing, not printing.

Merchandising and Recognition

If merchandising is used correctly, it can leave a permanent reminder especially with existing prospects and customers. You remember, the more contacts, the greater the effect on the individual consumer.

Originally, merchandising came from the music industry. Music bands print their logos on simple T-shirts so fans can take them home with them after the concert. So you always have the memory of the live concert but also the reminder, if you like the old songs, buy the new ones too! Today, merchandising works not only for music bands, but also for companies. From sponsored shirt merchandising for long-distance running and positive PR through sport and movement to brand merchandising, your own brand logo, large and present on a T-shirt or jacket. Some of the long-distance runners will wear the T-shirt for a long time as proof that they were there. In the gym, in your free time or while jogging. Excellent options for companies to bring their logo to the right target audience. It also works with brand merchandising. The bigger the brand logo, the better! So everyone can see what they can afford.

Merchandising is about leaving a lasting impression, having a constant source of memories for the customer and brand presence in the target group. By wearing pieces such as T-shirts or bags, logos get a large advertising space. With a walk on Friday afternoon, through the city centre, a simple T-shirt or jute bag can reach 1,000 to 2,000 contacts so quickly. Projected on days, weeks, months and years, you have not only made a small business with it, but also placed advertising, completely free of charge and sustainable. Not only with the customer himself, but also with his or her circle of friends, as well as in the close public, e.g. shopping or sports.

Guideline: Setting up your own business & business plan

You want to start your own business as a real estate agent or with another business idea? Tips on choosing the right professional: real estate broker. We support you with tips on your business plan and concept. Whether self-employed full-time or part-time self-employed: If you want to set up your own company, you have to think about a lot, in advance and in the operative business. From the right idea to health insurance – what needs to be considered if you want to become self-employed?

There is no training or further education for entrepreneurs. Managing director is you or not. Your own ambition is always important, because this is the only way to improve, every day.

The topics at a glance:

Advertising: Making products and services known

The big question now is how do customers learn about your product or service? The possibilities are extremely diverse, from classic flyers, YouTube advertising, poster campaigns on citylights to classic letter items. But which method and strategy is the most effective for you to generate more reach?

Before we take a detailed look at the individual methods, here are the two central questions on the point of advertising:

1. How do your customers find out about your product / service?
2. What advertising do you plan when?
   → There are hundreds of options
   Flyer: 54 Euro
   Mirror print advertisement: 25.000 Euro (1 page)
   Google Ads: 3,14 Euro per click
   City Lights: 80,000 euros for 4 weeks / 1 city
   SEO advertising agency: 120.000 Euro
   …

How extensive advertising can be! Accordingly, you need to choose strategies that fit your budget. In the next chapter we will look at how exactly the individual advertising measures work and function.

Goal: increase reach, increase awareness

Winning customers is the never-ending-story of every company. Growth is, of course, the ultimate goal. Once the market is saturated, it becomes horizontal or vertical in breadth, with product extensions and completely new product innovations. Good to see at the world’s most valuable company that has conquered the world with smartphones, previously a portable MP3 player, before with computers. Today there are tablets, matching headphones but also accessories for the technical devices. Accordingly, the customer group is constantly being expanded. In addition, there are old appliances that are offered at lower prices and the customer group is being expanded. So you are permanently in a process of customer acquisition.

Awareness takes time: How long does advertising take?

In the beginning it is of course more difficult, because first you have to be convinced of the new brand or the new product. Anyone who already owns a similar product must not only be convinced by the new brand, but also by changing. After all, we humans like habits and are reluctant to change them as long as they do not negatively influence us. Accordingly, a strategy must be found that ensures sufficient range, one-time contacts but also recurring contacts. Because in particular frequent naming, ensures that marks remain in the memory.

Medium and advertising channel: Differences

However, depending on the medium and advertising channel, the prices vary extremely. In addition, you must distinguish between paid range and organic range. Paid reach is available overnight, but not sustainably and with each new contact, associated with new costs. Organic reach, e.g. through search engine optimization or community building in social networks, lasts longer, but provides accordingly sustainable reach and visitors.

Then there are not only the numerous new media, but of course also the classic advertising channels, from mailings to sales promotion through documents, image brochures and sales representatives. Let’s take a closer look at the various possibilities that are available today in the field of advertising. Here is an initial overview of the various customer acquisition instruments:

1. Media advertising
2. Trade fairs, presentations, conferences and congresses
3. Information, training, trade advertising
4. Sales talk
5. Mailing, Throws
6. Telephone calls
7. Sales promotion, sales documents
8. Merchandising
9. Promotions, discounts, special offers
10. Exclusive offers
11. Additional services
12. Guarantees, Service
13. Internet
14. Social Media Marketing
15. …

Customer care in the business plan

How do you get across in your business plan that you not only reach your customers once, but ideally can show more frequent contacts?

Ideally, you will need regular customers, i.e. people who access your product more frequently. So in this aspect, think about how you can give customers an added value that keeps them with you as a brand, product or service. These include, for example, the above-mentioned additional services or the Extra Guarantee and Extra Services. But it also includes a sensible product extension, so that the right accessories are always available. No matter what the subject, interior design and living, trend products and fashions, Auto & Tuning or even hotels and restaurants. In all areas, useful additional services can be found that turn customers into regular customers.

Subsequent bookings make a lot of work easier and of course save a lot of media budget. Because no investment has to be made for the renewed purchase. Everything you need to know: home buying tips. This also pleases bankers and investors.

Recommendation Marketing: Actively Obtain Ratings

Tip! Actively obtain ratings. Write to customers, three to five days after the purchase, and ask them for their opinion. Ideally with a link to a relevant rating portal. For Amazon buyers this means Amazon, of course, and for many others Google and Facebook. A positive rating (recommendation marketing) is extremely efficient. In addition, the customer feels valued by the demand and is reminded again of your brand.

Exclusive offers

If we think further, such customer loyalty naturally also leads to further investments for public relations, e.g. events. Many companies hold regular events to attract audiences (and regular customers). The event in the fashion boutique, the training event of the handicraft producer or also the trainee and job event of the local energy supplier. Such strategies can also be used to retain customers. Here we are again at the marketing tool “Exclusive Offers”.

Take care of long-term business relationships and show in your business plan how you will do this strategically.

1. Reward for loyalty
2. Reward for recommendation
3. Demand

Guideline: Setting up your own business & business plan

You want to start your own business as a real estate agent or with another business idea? We support you with tips on your business plan and concept. Whether self-employed full-time or part-time self-employed: If you want to set up your own company, you have to think about a lot, in advance and in the operative business. From the right idea to health insurance – what needs to be considered if you want to become self-employed?

There is no training or further education for entrepreneurs. Managing director is you or not. Your own ambition is always important, because this is the only way to improve, every day.

The topics at a glance:

That’s entrepreneurship! That’s starting a business! Before you have ten or twenty employees at your disposal, you have to take care of a lot yourself. That means responsibility, but also a lot of fun and experience. This is exactly what my lecture is about, honest words, business plans and international strategies. From A to Z.

Lecture: Start Ups and Business Start-Ups 2019

In our two-day workshop on the subject of setting up a company, all key facts were discussed for four hours. At the end of the presentation, which was one of my longest with over 100 slides, all students went into the group phase to think up, create, plan and finally present their own companies in front of everyone, like in a real pitch situation. Many of the young students of the Zurich University of Economics and Computer Science will experience pitches, because pitches do not only take place for investors, but also in the company ideas are constantly pitched or new projects.

What is a pitch?

Maybe you’ve seen the TV format Cave of the Lions before. Here you can see very well in a public setting how a pitch works. Investors or managing directors or department heads listen to the different ideas. On the basis of the large number of projects, one can weigh up and compare very well, but also evaluate which idea has the most potential. Depending on this, one person or the entire group decides for Project A or Project B. Investors are then invested in this idea and, if necessary, know-how and structure are made available. In companies, a project is implemented, if necessary the person then also becomes a manager, perhaps even the managing director of a spun-off subsidiary. Don’t count on anything, but always dream of the great! If you want to know more about pitches, you can find an article here:

• Pitches in agencies and investors

Live Alexanderplatz Berlin from HSO School of Economics and Computer Science (Zurich, CH)

Twice a year we meet at Alexanderplatz in Berlin, high above the rooftops, to talk about startups and companies. With over two hours of lecture time, one hour of group work to train the entire pitch situation, the students get to know reality within a very short time. We try to convey a quick, comprehensive picture instead of discussing individual and individual points. The young students should learn directly from my experiences, in order to draw their own conclusions from them, in order to advance even faster.

My goal is to always pass on knowledge so that the next generation can do great things. Just as we had our role models, we must also be role models for the future. In all my lectures, I therefore always try to deal with issues such as employee satisfaction, the agency offices and the environment. Because the feel-good factor also plays a role in a company. Of course it is 90% work and only 10% should go into such thoughts, but to every good company belongs a Christmas party!

With exactly this mix of business plan, online marketing strategies, experiences from my business life, small inspiration and thought-provoking impulses like employee satisfaction, I try to introduce the students realistically to the topic of self-employment and entrepreneurship, so that they would survive directly in everyday life. That’s why I’m very pleased to be working with the Zurich University of Economics and Computer Science. The students are very smart and always present very interesting concepts. One or the other is certainly realized, which you will notice in later conversations or in e-mails that come two or three weeks later with: “Hey, I’ve started!”. – Let’s do it!

Here you will find further information about the:

• HSO Business and IT School – Zurich

Example slides from the presentation – selection

For a small insight into the lecture I have here still a selection of individual slides, which we can show also here publicly. Let’s start with an overview of the topic of setting up a company.

Book now: Lectures on business start-ups and start-up strategies

Are you interested in an own workshop or lecture in your company or university? Write me an e-mail or give me a call, we are looking forward to your inquiry.

• Speaker – Inquiry & Booking