Sustainability

4. Will that revenue stream last? (How many customers will pay? Will they keep paying?)

For a product to be successful in the business world, it has to bring in more money than it costs to produce. That’s profit: revenue in excess of cost. In the business world, a business plan tries to figure out whether profit is likely. If it does seem likely, the plan will get funded.

It is fairly easy to tell, after you’ve started a business, whether you were right about the money. The equation is simple: money in, money out. You count how much money goes in to creating the thing, and then you count how much money comes out the other side in the form of revenue.

In the business plan for the mobile dental van, Dare County Health Department estimated that after the first year of operating they would have a net gain (“revenue over expenses”) of over $50,000. After five years of operation, the program would be completely self-sustaining, if all went according to plan.