Starting a Business in Berlin

56 57 Starting a Business in Berlin A Beginner’s Guide Investment plan Business premises € + Buildings € + Building work € + Additional building costs € + Basic workshop outfitting € + Machinery, equipment, etc. € + Vehicles € + Office equipment € + Initial supply of materials € + Initial supply of goods € + Miscellaneous € = Long-term capital requirement € The first weeks and months post start-up are usually cha- racterised by the fact that the operating costs and expendi- tures incurred are not initially offset by revenues, as there is generally a significant period of time between the initial inco- ming orders, processing the orders, and the first incoming payments. The resource requirements for this start-up period (such as wages, salaries, rent, insurance, advertising, interest, loan repayments, and even private expenditure) represent your short-term capital requirements. These are either to be funded through equity, an overdraft facility (current account credit) with the local bank, or working capital financing with a fixed maturity. For more information on determining the short-term capital requirements, refer to “Liquidity planning” on page 62. N.B.: The tables shown here serve only to explain which elements need to be included in the set of figures in a business plan. Your own figures section should contain more thorough and detailed infor- mation. Help is available in the literature, at regular banks and savings banks (Sparkassen), and on the internet. CAPITAL REQUIREMENT AND INVESTMENT PLANNING Generally speaking, setting up a company involves various costs and expenses. The available equity is frequently not sufficient for financing the venture, meaning additional fi- nancing options have to be developed. So for sound financing to be a possibility, you need a detailed plan of your capital requirements and investments, which shows the short-term and long-term capital requirements. This breakdown into short-term and long-term considerations is essential, as the- re are different financing options that come into play. Long- term capital requirements are clear from the investment plan, in which you list all investments necessary for setting up the business along with the corresponding acquisition prices or costs. Cost estimates, price lists or even valuation reports should be used where possible; if not, do as best you can with initial estimates: CHAPTER 5