LONG TERM BUSINESS PLANNING
A tourism and leisure company was considering whether to invest in a significant expansion project. They produced their annual accounts in time for the nine month filing deadline, but not sooner, and had limited monthly accounting information.
The owner had developed a business plan that involved significant expansion, and had access to funding, but did not have the ability to produce long term financial plans. He approached a local firm of accountants who recommended that he used us for this work.
We spent several sessions in discussion with the owner to understand the business model, how the growth would work in practice, and how the funding evolved over time. We discussed various risk areas in the business plan and what ranges of outcomes were possible. We then produced a complex business model working with operational input information. We validated the model as a whole with the owner, and then undertook sensitivity analysis with four agreed scenarios of different growth performance.
We summarised the results in visual form and fed them back to the owner, who then decided to proceed with his expansion plans. He followed up on the risk areas identified, making operational changes in some areas to address these.