FINANCIAL SECURITY THROUGH MULTIPLE STREAMS OF INCOME (Part 3)

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SETTING OUT – Understanding Business Plan

  • Business Plan: A business plan is a complete description of a business and its plans for the years ahead. The importance of a business plan cannot be over-emphasized as it has two primary objectives. These are:
    • External Objective: To obtain funding that is essential for the development and growth of the business. It is a major requirement for loan facility from any financial institution.
    • Internal Objective: To provide a plan for early strategic and corporate development. It serves as an Action plan, a road-map, a performance tool and a business promotion tool.

Content of a Business Plan: The content of a business plan varies with the type of business initiated. However, a typical business plan can contain all or some of the followings:

  • The Business: The business background, vision, Mission Statement and Corporate Strategy.
  • Organizational Structure: Office location, Directors’ profile, Share Capital Structure, Shareholding structure, Management Team and Staff Force.
  • Operational Plan: Production Process, Operational Strategy and Resource plan.
  • Market Analysis: SWOT analysis, Competitors Analysis, etc.
  • Marketing Strategy: The 4Ps (Product, Price, Place and Promotion), Distribution network and marketing.
  • Financials: Profit Forecast and Projections, Cash Flow, Balance Sheet, Bases and Assumptions, Financial Ratios.

However, it needs to be noted that in drafting a business plan, a Professional needs to be consulted, such as a Chartered Accountant, especially when such business plan is for external objective.

  1. Watching the Pitfalls.

A major pitfall in the pursuit of multiple income streams is the trick of finance. Many couldn’t start their desired business because of the lack of fund, especially loan facility. However, the knowledge of starting small with what you have will bail one out of this limitation; great businesses of today started small and grow gradually.

Also, you should not make a mistake of trying to create multiple streams of income at the same time without having a solid one first. Businesses are meant to serve as a back-up to a major one, so it is advisable to have a solid and regular source of income first so that when things go bad with the new businesses, you can fall back on the main source of income and vice-versa.

CONCLUSION

The importance of multiple income streams cannot be over-emphasized; it is the bedrock of wealth as long as you can give it the patience and skill it needs to grow. So, whatever income class you choose, if you desire financial freedom rather than living from hand to mouth, pay-cheque to pay-cheque, always broke every month end and forever asking “Have they paid?”, grow multiple streams of income, so that you do not remain at the mercy of one income source.

As you take on the decision to create wealth through multiple streams, it’s my prayer that the Lord who delights in the prosperity of His children will guide and order your steps aright. GOD BLESS YOU.

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