Transcript CHAPTER21.PPT

Developing Budgets
• Develop complete chart
of accounts
• Research cost
for each account
• Develop a budget book
• Avoid straight line estimating
• Forecast sales volume
• Relate to sales and inventory needed
• Project best case/worst case scenarios
• Project break-even budget
21.1
™
Kauffman
Center
for Entrepreneurial
Leadership
©©2001
2004 Ewing
Marion
Kauffman
Foundation
PLANNING AND GROWING A BUSINESS VENTURE™
Start-Up Costs
• Make a list of potential
start-up costs
• Recognize difference
between ongoing
expense and one-time
start-up cost
• Determine if landlord is willing to
absorb some start-up costs
• Weigh leasing equipment vs. purchase
• Consider inventory on consignment
21.2
™
Kauffman
Center
for Entrepreneurial
Leadership
©©2001
2004 Ewing
Marion
Kauffman
Foundation
PLANNING AND GROWING A BUSINESS VENTURE™
Start-Up Costs
• What type of signage will be required?
• Are there any applicable city codes?
• What types of supplies will be needed
(such as cleaning, office, shipping)?
• What type of training is necessary
before opening for business?
• What types of government business
licenses will be required?
21.3
™
Kauffman
Center
for Entrepreneurial
Leadership
©©2001
2004 Ewing
Marion
Kauffman
Foundation
PLANNING AND GROWING A BUSINESS VENTURE™
Start-Up Costs
• Where will the business be located?
• What size will it be?
• What does the office or retail space look like?
• What type of walls and fixtures does it have?
• What type of equipment will be needed?
Computers? Furniture? Carpet? Copy machine?
Shelving?
• How much opening inventory will the business
need? How will it be paid for?
• What types of deposits will be needed for
telephone, utilities, rent
(first and last month)?
21.4
Kauffman
Center
for Entrepreneurial
Leadership
©©2001
2004 Ewing
Marion
Kauffman
Foundation
™
PLANNING AND GROWING A BUSINESS VENTURE™