How budgets can assist your business to grow and achieve
A Budget Is A Great Tool To Help You
As the new financial year has arrived, now is the time to assess your business. Work out where you are headed and what your financial goals are. A budget is a great tool to help you plan your income, expenses, staffing, holidays (yes we are all allowed to have them), seasonal fluctuations, cash flow, and anything else that could affect your business.
Make Planning And Budgeting A Priority
Most people get scared when thinking of budgets and therefore they just completely ignore it all together and it gets dumped in the “too hard” basket. I understand being a busy business owner – however I think this is potentially a huge mistake and planning and budgeting should be put back on your priority list.
We treat our budgets as a helping hand to guide you in the right direction – when you should be spending money, what you should be spending money on, and it can also outline potential down times which can help with staff rosters. These are just a few things a budget can help with.
A Budget Can Be Simple
Budgets do not require complex formulas, calculations, fancy programs and a degree in mathematics to use them. A simple excel budget can be quite adequate for many small business owners.
Budgets are essentially estimates – estimates of what you think you will sell (products) or provide (services) converted into monetary values. You can then also estimate your cost of goods sold – which are costs directly associated to making those sales, and then also your over head costs. What you should be left with each period in your budget is your anticipated profit (hopefully) or this could be a loss.
Create An Effective Budget
Without effective budgeting you may be spending more money than required to make effective sales, be spending money at the wrong time, you could be overstaffed or understaffed at the wrong times – all of these things effect your bottom line.
Budgets should not be seen as a static thing … done once, put in a drawer and forgotten about. They need to be reviewed constantly – not only for changes in business, but changes in your business environment. Be proactive and your budget will be your best friend – guiding you to making the most you can out of your business, and minimizing unnecessary expenditure.
If you would like a sample budget template – please don’t hesitate to ask, and we can forward you one that you can customize to your own business needs.