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Four things you must consider when planning your company's future financial goals

by , 09 September 2014
The point of your financial planning is to create a road map to achieve your financial goals. Without these goals and a plan to reach them, your company will flounder with no direction.

But you can't just guess your goals. If they're unrealistic, it's as detrimental as not having any goals at all.

That's why you need to be careful during your financial planning and consider all the factors involved...


When you do your financial planning, consider these four factors

Factor #1: The demand in the industry you're in
If you're in an industry with a lot of demand, such as healthy food stores, which are very popular at the moment, you'll experience fast growth.
Factor #2: Is this industry a fad industry or is it sustainable 
If there's a high demand for your product because it's a current fad, your rate of growth isn't sustainable. Eventually, the trendy element will wear off and you'll experience a growth slump.
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Factor #3: The general economic climate you're in
If the economic climate is very unstable or in a recession it means growth is very difficult. Your company may take a very long time to reach its goals if the economy is tight and people don't have money for your product or service.
Factor #4: Your company's current financial position
You need to consider the gap between where you are now and where you want your company to be. The bigger the gap, the longer it'll take you to reach your goals.
You need to be realistic about your goals to achieve them in the timeframe you want. Considering these four factors will help you create realistic goals.

Find out how to analyse your financial statements and identify errors and be 100% up-to-date on new and updated accounting and reporting standards.


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