Financial Planning


Why is financial planning important to business owners?  Additionally, why do managers in your business (sales, operations, etc.) also need to understand elements of financial planning and be involved in the process?

  1. Forecasting and planning.  Business owners look ahead, they make plans for growth that will shape the future success of their business.  Financial forecasting and planning are important activities that business owners are responsible for ensuring are done.  Owners typically work closely with key managers in their business to forecast and plan.
  2. Investment and Financing Decisions.  Business owners make decisions about investments in equipment, facilities, and inventory.  These investment decisions are driven by growth strategies that may require the purchase of new assets, and the need to replace aging and deteriorating assets.  In addition to making purchasing decisions, the business owner must decide how to finance asset purchases.  Will these planned purchases be done with debt, equity, or a combination of the two?  If debt will be used, decisions will need to be made about structure and terms, and a loan request will need to be created to present to the financial institution.
  3. Coordination and Control.  All business decisions have financial and other implications.  To operate effectively and efficiently, owners must work with key managers (sales, operations) in their business, and with other partners like their business banker and accountant.  For example, marketing decisions impact sales growth and sales growth requires investment.  Additionally, sales growth impacts elements that include: operating capacity, staffing levels, and inventory levels.  All of which influence investment requirements.


Are you effectively incorporating financial planning into your business?  If financial planning is an area you would like to work on, contact the Idaho Small Business Development Center today to begin working with a consultant.

thumbnail of Debbie Winkler

About Debbie Winkler

Debbie joined the Idaho SBDC in February 2008. Her prior work experience includes the role of Business Improvement Consultant with Boise Business Consulting, a family-owned business. Prior to working in the family business, Debbie was Senior Vice President and Manager of National Consumer Training and Associate Development for Bank of America.

In addition, Debbie was Vice President and Manager of Business Banking for First Republic Bank, and Vice President and Portfolio Manager, Commercial Banking Group, for First Republic Bank (a predecessor of Bank of America). Debbie is a graduate of the University of Texas, Austin, with a Bachelor of Business Administration in Finance.

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