Radio Station Business plan: Preparing financial projections
Financial projections form an important component of a radio station business plan.
A well drafted financial project report holds the key to getting quick license and then to get funds from banks or financiers.
Banks and financiers lack the skill to asses the technical aspects of your proposal so they give very high importance to the financial analysis of your project report to decide the proposal’s funding suitability.
While the list could be further expanded you will have to compulsorily prepare the following financial statements when preparing your radio station business plan
1. Estimated income & expenditure account for next 5 years – This involves estimating all incomes and expenditures for the radio station for next five years based on realistic assumptions. All assumptions must be quantified and backed by suitable explanations of why you think it can be achieved.
2. Estimated Balance sheet for next 5 years – This involves estimating the assets and liabilities of the radio station for the next 5 financial years. The figures are to be estimated at the cost and not on the estimated market value of these assets.
3. Estimated monthly Cash flow statements for next 5 years – This statement will estimate the cash inflows and outflows for the radio station business plan and will ensure that the radio station does not face liquidity crunch or shortage of working capital for the projected period.
4. Preparing a repayment schedule – This will essentially be drafted if you are applying for loans from banks or investors. This statement will give the bank a clear indication of how you plan to repay the interest and the principal component of the loan. This will thus make the bank or the investor in lending for your radio station.
If you are versed with accounting, you can easily prepare these statements. If accounting is not one of you strong points, use the services of an accounting firm or an individual accountant to draft these items professionally.
You should not skip or ignore these basics even if they might look a bit intimidating in the beginning. Trust me it’s not rocket science. Its plain simple common sense put into formats.
You will have to keep tight control on your finances, no matter what you choose to do in your life. Take this chance to learn the basics of accounting.
Well you will agree that setting up a radio station is an exhaustive topic, much beyond the scope of a few articles on the subject. Therefore we have drafted a complete blueprint kit that you can download by clicking on the image link above.