In an investment plan, you draw up a list of all one-off expenses for all investment items associated with an investment, including the costs incurred during the start-up phase for advance financing. If it concerns an initial investment for incorporating a business, the investment plan will also contain all costs associated with establishing the company.
We illustrate the structure of an investment plan using the example of an initial investment and apply the following outline for this purpose:
- Capital requirement for the (formal) incorporation of the company
- Capital requirement for ongoing operating expenses in the start-up phase
- Capital requirement for investments in fixed assets
- Capital requirement for investments in current assets
- Expenses for debt servicing
If your planned investment concerns an initial investment, you should list the costs of incorporation in the investment plan separately. The capital requirement for formally establishing the company includes all expenses incurred in preparing the founding process – for example consulting costs as well as fees for registration, permits or notary certifications.
Moreover, investments are usually associated with expenses for material and immaterial assets. A distinction is made between fixed and current assets. Fixed assets are all assets you procure as part of investing for continuous use in operations – such as equipment, machines or vehicles as well as immaterial assets like licenses and patents. Assets such as goods, materials or resources used for disposal, consumption or processing – and are therefore held by the company only temporarily – are allocated to current assets.
For investments which you wish to fund entirely or partly using borrowed funds, you should also indicate the expenses for interest and repayment instalments in the investment plan.
- Costs of incorporation/one-off expenses in the start-up phase
- Rent deposit
- Legal advisors
- Tax advisors
- Business advisors
- Business registration
- Development of a corporate design
- Opening event
- Opening advertising
- Website setup
- Market information
- Registrations/approvals
- Entry into the commercial register
- Notary
- Reserves for start phase, follow-up investments and unforeseen costs
- Fixed assets
- Patent, license and franchise fees
- Plots/property including incidental costs
- Production equipment, machines and tools
- Operating and office equipment
- Communication technology (PCs, telephones, etc.)
- Software
- Vehicles
- Current assets
- Materials and goods inventory
- Raw, auxiliary and operating materials
- Debt servicing
- Interest on founding loan/bank credit
- Repayments
All the above details are added up in the investment plan. The final amount of the investment plan indicates how much capital you need in the initial phase of the investment to implement the planned project.
Make sure that you have specific offers for the individual cost items. Only then will you ensure that the amount of the necessary investment is determined as thoroughly as possible.