Investments and financing: what you need and how you pay for it

Video: how to set up investments and financing in the Business Planner.

Anyone assessing a financing request wants to know two things quickly: how much money you need, and where it goes. This part of the Business Planner answers both. You record what you buy, how long you will use it and which money you pay for it with. The planner then works out the depreciation, interest and repayments itself, and shows whether your funding adds up.

Three tabs that together form your financing plan

1. 01

   Setup

   The start date comes from Basic. You choose whether you are planning a new business, with forecasts only, or an existing business with actual figures. Then you set the planning horizon and enter the opening cash balance and the tax rates.

2. 02

   Investments

   For each asset, you choose a category, such as furniture or IT and hardware, and enter the purchase value, the residual value and the useful life. The planner shows the depreciation per month and per year right away.

3. 03

   Financing

   Here you record loans, owner equity and, if relevant, a dividend policy. At the top, you can see whether your capital requirement is covered.

Depreciation in plain language

You buy a styling chair or a checkout system in one go, but you use it for years. That is why the purchase doesn't count as a cost in a single year. Through depreciation, the planner spreads the amount over the useful life. The depreciation flows automatically into the profit and loss statement, while the payment itself shows up in the cash flow in the month you buy it.

The demo salon in Amsterdam has three investments: a renovation of the color station with two wash units, two styling chairs with a mirror wall, and a new checkout system. The renovation is depreciated over ten years, the checkout system over three. That way, the depreciation matches how long each item really lasts.

Choose the repayment type that fits your loan

You can also set a grace period without repayments, include an origination fee and choose the month in which the loan starts. The monthly payment, the interest in the first month and the total interest appear right below the form.

Does your funding add up?

At the top of the Financing tab, the planner sets your capital requirement against your funding. The requirement consists of the opening cash balance, the investments and the largest start-up loss. The funding consists of equity and loans. If there is a shortfall, you see it straight away, along with how much extra funding you need.