Business Plan Writer is the first business planning software I’ve reviewed with the start-up business owner in mind.
It is available from http://businessplanwriter.co.uk/ and has been written for the UK market but before you jump in and buy, you should read my review.
What I Like About Business Plan Writer
- The cost of Business Plan Writer is very low – I paid less than £40 for the one year small business version. There are also versions for Co-operatives and Social Enterprises.
. - It is intuitive to use for writing the words and doing the numbers. You don’t have to be a business planning expert and it has sample plans to help guide you along the way.
. - The words and numbers are combined into one plan for export into Word (if you want to make it look pretty) or directly into a pdf.
. - I like the idea of the mini-plan which helps you to plan the plan. If you’ve ever written a business plan, you’ll know that it can be very daunting.
. - The words and numbers are both broken down into separate smaller sections. This is the old “How do you eat an elephant? One bite at a time.” approach and it works.
. - The sales forecast can be built up from 20 different products/product groups where you forecast the quantity sold, sales prices and direct variable costs. This gives you a choice to choose between cash and credit assumptions for sales and costs. This area for the product sales and margins is the critical section and I have a bee in my bonnet that it is too often skimped over by professional accountants in planning and reporting. I like the way that Business Plan Writer encourages you to think carefully and also focuses on the drivers – units and prices – rather than total values.
. - The plan saves itself each time you update it.
What I Don’t Like About Business Plan Writer
What I Don’t Like About Business Plan Writer – Words
- The size of the fonts is too small for me. I’m finding that I’m having to squint at my PC when I can normally read the screen fine. This makes using Business Plan Writer tiring and uncomfortable if you no longer have 20/20 vision but are too vain to have glasses.
What I Don’t Like About Business Plan Writer – Numbers
My accountant hat has come out – I am a chartered accountant, even if I don’t trade as one.
That means I know that I can do anything I want with a spreadsheet although it can take many hours to build a complex model tailored to a particular client or business sector. Unfortunately for Business Plan Writer this means that I’m a hard taskmaster on the numbers.
There is a big trade-off between being simple to use and creating valid information which presents a meaningful picture. Business Plan Writer keeps things simple, I’d have added some more complexity to give more flexibility.
- The months are headed 1, 2, 3, 4 rather than January, February etc. This has the advantage that you can start in any month but if you have a seasonal business (e.g. retailer and Christmas) and it takes you longer than you expect to prepare and present your business plan, you may be shuffling your numbers along and you may get confused. I’d have liked to have seen a table where you can define the months to make the plan easier to review.
. - You can set a flag for whether your business is registered for VAT or not but I’ve tried it twice now and neither time did it work out the VAT correctly -although the rate is set at 20%, it is only calculating at 1%. I’ reported this to the author of the Business Plan Writer who accepted it as a bug which was fixed within 24 hours. I’m impressed. Bugs happen – if Microsoft can’t get it right with their huge resources for developing and testing software, then smaller developers will also have the occasional problem – what’s important is that they get them fixed.
. - I like the simple way you can set up the model per product for cash or credit sales and purchases. If you think you’ll have both, you can set up cash products and credit products. The standard assumption is you’ll be paid in the following month – that’s sales in June will be paid in July – and you can’t change it. Most businesses I see have Days Sales Outstanding of between 60 and 90 days because of the standard net 30 day terms – items sold on 15th June become due on 31 July and most of the money from the good customers comes in the first two weeks of the next month. Other customers have to be chased hard. It’s an added complexity but I’d have liked to have been able to choose between more credit options.
. - The numbers need to be checked after you’ve done your plan – I am sure that a change on one product created a change on another although I couldn’t repeat the experience.
. - Overheads gives you plenty of flexibility to build in the costs you need but there is the big assumption that expenses for the Profit & Loss account and payments for the cash flow are the same. This is where simplicity causes conflicts with valid information. For example, if premises are a significant cost for you (e.g. you’re starting a shop) and you have to pay rent on the quarterly days in advance, you’ll either get the cash flow or profit forecast wrong to give a better view of the other. This may dent your credibility with a bank. Since you’re forced to choose, I recommend that you work at getting the cash flow right and let your accountant worry about how costs are spread over the periods in the Profit & loss Account.
. - I like the fact that you are encouraged to build up your personnel costs by person from their starting dates but I couldn’t get starting dates to stick unless I also set a leaving date first I assumed they left at the end of the year, (just don’t tell the staff). The guidance notes aren’t up-to-date either since the monthly spread of costs seems to be new functionality. There are separate flags for employers national insurance and pension but they are combined into one total. I found it easier to turn these off until I was happy with the numbers and then turned them back on.
. - You can introduce assets at the beginning e.g. if you have a van which you transfer into the business but this is treated as equity rather than a loan and it is only on these assets introduced that depreciation is calculated. assets bought in month 1 don’t carry any depreciation throughout the year. This is wrong although it doesn’t affect the cash flow as it is a non-cash expense. For some strange reason the depreciation charge all happens in month 12 in the Profit & Loss Account.
. - I couldn’t find any way to handle stock. I know from my own modelling experience, this can get incredibly complicated but it would have been nice to have a stock build/reduce facility – even if it was one amount up or down each month – to make the cash flow more representative. Again using a shop as an example, you’re going to need stock when it opens and you will probably increase the value as the store gets more established and sales grow.
. - The numbers are built up in detail but the reporting is done as a high level summary for the Profit & Loss account. I like the summaries since they don’t overwhelm you with numbers but I would like to be able to print out the details and choose which to include in the business plan. When you get asked a question like “What assumptions did you make about rent and rates in these property costs of £6,500 per month”, it’s nice to be able to show the detailed analysis without having to flounder around with “I think I assumed rent of £3,500 and rates of 40% of the rental cost.”
. - You can have two loans in the business which I think is good but I’d have liked to have been able to give them labels to make it clearer what money is coming from whom.
. - The Profit & Loss account and cash flow are monthly, the balance sheet is just for the end of the year [even though it doesn’t say]. Personally I’d have liked to see a monthly balance sheet although this is another complexity. It’s just that it helps to show how any cash problems have arisen.
Business Plan Writer doesn’t split the direct labour and salary costs between the net payment in the month and the payment of PAYE tax and national insurance to HM Revenue & Customs the following month but I don’t have an issue with that. It keeps things simple and it is prudent on the cash which is the way to be.
Despite my concerns on the numbers forecasting, I do think that Business Plan Writer is useful if you want to get a broad-brush view of the financial feasibility of a business idea. The challenge for any business start-up is to build up sales and margins fast enough to stop the start-up costs and day to day expenses causing the business to run out of money.
Overall Thoughts On Business Plan Writer
It is easy to use and if you want business planning software to help you to focus and write the words in your business plan, then Business Plan Writer will be a big help.
Unfortunately I have significant concerns on the numbers side for anything but the simplest of businesses. It would be OK for me with my business coaching and training because I don’t have to worry about stock/work in progress or equipment.
It will work less well for consultants and designers who build up work in progress on projects and only invoice when stages are complete and the lack of stock means it’s not suitable for retailers, distributors or manufacturers unless you process other people’s materials or receive it on free issue.
I had hoped Business Plan Writer would do a bit more to help small business owners get to grips with their numbers.
I’m a bit believer in the “do it yourself” approach to business planning and then having it reviewed by a professional. This way it is your plan.
Business Plan Writer is at the cheap and cheerful end of the market for business planning software. It is very useful if your needs are simple.
Business Plan Writer Is Recommended
Recommended for those business owners who:
- want to work on the business planning words and will let someone else worry about the numbers or
- for those whose financial requirements are very straightforward or
- who want to get a broad-brush view on the feasibility of a business idea.
Have You Used Business Plan Writer?
If you have used Business Plan Writer, then I’d like to hear what you think of the software.
Did it help you to write a business plan or did it frustrate or confuse you?
Update On Business Plan Writer
Following my review I had a good chat with the software author, Dave Kilroy and he’s taken many of the points on board.
There is a multi year version of Business Plan Writer coming out in the next few weeks and then in the winter, there will be a version that deals with the issues that I’ve raised.
I think it’s important that Business Plan Writer stays simple to use.
