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Company-wide finance planning in order to create flexibility and planability

The account balance is unsuitable as the sole tool for financial planning, as it is neither transparent enough to show the company's financial position in a way that can be understood by all stakeholders, nor does it provide information on how well the company has structured its finances or whether it is in a position to be successful in the long term.


The information provided is based on our own experience and does not constitute legal, tax or other legally regulated advice.

The data entered is not transferred to a remote server and thus remains local to the end user of the calculators.

The helicopter perspective

A top-down helicopter perspective in financial planning provides the ability to get a comprehensive view of finances, identify potential risks before they become problems, all without a lot of effort.

Determine the minimum amount of capital

This amount varies by country and industry and is usually used to secure funding for current business activities and to hedge potential risks.

One way to determine the minimum capital amount is to analyze average monthly expenses and revenues, as well as potential risks associated with the business. A reserve for unforeseen expenses or risks should also be included. A financial advisor or tax professional can help you determine the minimum capital amount for your specific business.

Definition of one's own security needs

Every company needs to be able to cover its current costs and additionally adjust to fluctuations in the income situation. An example company, without assets and large write-offs, could make the following definition:

In the event of an immediate, prolonged loss of income, the company's financing should be secured for the next 12 months.

To make this objective more concrete, the average costs must first be determined.

Simplified example calculation

As the simplest approach can be used for this actually the monthly account movements. To do this, simply use the accounting software to log the account income and expenses each month, e.g. in Excel. This approach is very rough, does not provide a view of tax liabilities, profit to be paid or investments. This is not necessary in the step, because it is about the solvency at any time.

4000 Euro
4 Months

Expenses * Number of Months = 16000 Euro

The amount determined in this way should therefore be freely available at all times and represents a KPI for the company, which should be checked monthly as follows:

  • Capital is available (yes/no)
  • average costs per month are unchanged
  • the chosen period for the safety buffer is still reasonable

By turning this into a standard process, this important basis for financial planning can be completed in a matter of minutes and provides the necessary peace of mind to act with business confidence.

Total Cost: 20900 Euro

Minimum: 2000 Euro

Maximum: 6300 Euro

Average: 3483 Euro

Spread: 1589 Euro

When calculating the average, one should consider the variance and make a decision as to how far one wants to include this dispersion in the definition.

Profitability indicators

Profit before taxes

This key figure shows the profit generated before the deduction of taxes. It is a measure of the operating success of the company.

Within the fiscal year, a corresponding amount of capital should be set aside for the payment of profit tax. By increasing the costs, the profit decreases and therefore also the taxes due for it.

For a GmbH one can roughly estimate 30% taxes and this foreseeable tax liability thus becomes another KPI.

Return on sales

Return on sales, is a financial ratio that indicates what percentage of sales remains as profit after deducting costs and expenses. It is calculated by dividing gross profit (sales minus direct costs) by sales and expressing it as a percentage.

The formula for calculating return on sales is:

Return on sales = (gross profit / sales) x 100

60000 Euro
630000 Euro

A high return on sales means that a company generates a high percentage of its sales as profit, which can lead to a strong financial position. However, a low return on sales may indicate that a company can easily struggle to cover its costs and make a profit. In this case, the business model should be subject to closer scrutiny. Medium-sized companies in Germany usually have an average return on sales of about 7%.

  • knowledge-intensive services: 12.2 percent
  • Manufacturing industry: 4.9 percent
  • construction: 9.4 percent
  • other services: 4.7 percent

Comparing return on sales to others is of limited use. Tracking this KPI over time provides additional measurement points to assess investments made and other business decisions.


The following KPIs form the basis and should be considered on a monthly basis:

  • Minimum capital amount
  • return on sales
  • expected tax liability

Corporate strategy and goals

budget planning

Financial forecast

Financial ratio analysis

Cash flow management

Financing strategies

Unit Economics

Tax Planning

Risk Management

Conclusion and recommendations for action