financial planning using wyn plan v 3

Financial Planning

for the

Emerging Growth Company

Using WynPlan SRDGrowing Business. Managing Success.

© C. F. Advisors 2010

Financial Planning for the


What is WynPlan SRD?

It’s a Sales Representative driven financial model developed in an

Excel 2007 spreadsheet specifically designed for small emerging

growth-oriented companies, from startup to over $50 million.

What are its Core Value Propositions?

It allows the non-financially trained business practitioner to:

1. Efficiently develop a robust financial plan,

2. Better understand the relationships between financial and

operational drivers, and

3. Dramatically improve resulting financial performance.

Financial Planning for the Emerging Growth Company

What are its reporting functions?

WynPlan SRD generates the following standard reports:

1. Assumptions (drivers) Summary:

(Drivers are KEY because they define Plan Performance)

2. Performance Reports:

P&L, BS, CF and more

Is it comprehensive?

Yes. It is comprehensive and complete. But we are always

available to answer a question or help as needed.



The Financial Planning Process has:

A Beginning

When you to start your plan

Middle

The progression of defining company structure and drivers,

leading to the iterative process of revising, fine-tuning, optimizing

and What-IF-ing

End

This usually occurs when you run out of time

WynPlan will help you get started and fine-tune the plan until

it is a solid reflection of your business goals and objectives.



LET’S DEFINE:

Company Structure

• Reporting Start Date (to a five year planning horizon)

• Plan Start Date

Department Structure

• Operations Department

• Sales & Marketing Department

• General & Administrative Department

• Research & Development Department



Define Sales Plan

Requires combination of:

• Selling profile, with expectations of Sales Rep performance

over time, starting from the date-of-hire

• Sales Rep Hiring Plan including hire date, salary, commission

Example of Sales Plan

• Hire Sales Rep during Month 2

• Hire Senior Sales Rep during Month 9

Step 1: Define Selling Profiles for:

Sales Rep and Senior Sales Rep

Step 2: Define hiring dates for sales team (months 2 & 9).



Sales Rep Profile Senior Sales Rep Profile

Combined Sales Performance

$0

$50

$100

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36

$0

$50

$100

$150

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36

$0

$50

$100

$150

$200

$250

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35

Senior Sales Rep

Sales Rep



Gross Margin Performance Options

Fixed

Variable with TIME

Variable with Revenue

Define Headcount Plan

• Precedent triggers allow for “Rules for Hire”

• Structure headcount plan by department

• Include permanent as well as temporary employees

G & A Headcount Plan. (Before & After)





Define Expense Plan

Expenses defined per department

Expense start date linked to Plan start date

Up to three planning methods per expense item

Cash or Accounts Payable payment option per expense item

Three planning increment options per expense item, which allows

for an increase or decrease in granularity



Define Current Assets – Relationships & Performance

Accounts Receivable

Immediate cash receipts (DSO = 0) plus receipts on account (DSO = user defined). Planned DSO is variable over time

Inventory

Days of on-hand inventory (variable over time) used as planning driver. Provision for COD payments as well as payments on account

Prepaid Expense

Expensed as a G & A expense over time specified



Define Fixed Asset Requirements

Allows for (user defined) capitalization amount

Computer equipment acquired per employee (amount specified by department and depreciated over a maximum of five years)

Other computer equipment acquired (capital amount specified per month and depreciated over same number of years as above)

Other fixed assets (capital amount specified per month and depreciated over defined number of years)



Define Current Liabilities Relationships & Performance

Accounts Payable

Days Payable used as driver (variable over duration of plan)

Accrued Liabilities

Included accrued interest as well as accrued sales commission

Other Current Liabilities

Represents accrued income tax liability



Define Financing Plan

Equity Infusion

Start-up equity and two additional rounds

Bank Loan

Iterative process of revising and fine tuning drivers



Iterative Process of Revision & Fine Tuning

Examine the Assumptions (Drivers) Report to develop awareness

as to what drives the plan. Identify potential changes.

Examine the Output (Performance) Report to develop awareness

as to how the plan performs. Pay attention to the Sales

Representative Detail sheet so as to understand Sales Rep

contribution.

Use the WynPlan ribbon on the Drivers sheet to monitor the effects

of changes to Drivers as a means of optimizing performance.



When you run out of time and have to “finish” the Plan,

remember the two truisms of financial and business planning:

Always under promise and over deliver.

The BEST way to predict the future is to make it happen.

C.F. Advisors

[email protected]

952 996-9091

mailto:[email protected]

financial planning using wyn plan v 3

Documents

financial performance

robust financial plan

emerging growth companywhat

emerging growth companylets

sales representative

year planning horizon

afterfinancial planning

financial model