Budgeting
Mapping out your business future
A key part of your business planning is your budget. Without a well thought out budget, you’ll have little chance of controlling that all-important cash flow. You won’t be able to plan for future expenditure or growth.
Keeping on top of expenditure
Is your business growing? If so, being hands-on with every part of it will be near impossible. You might find you have to split your budget between different parts – sales, production, marketing, etc. When money starts to move in different directions through your organisation, having a budget will be vital to ensuring that you stay right on top of spending.
What exactly is a budget?
A budget is a plan to
- control your finances
- ensure you can fund your commitments
- enable you to make financial decisions and meet your objectives
- ensure you have enough money for your future projects
A budget highlights where you’ll spend your money and how you’ll finance that spending. However, budgeting is different from forecasting. A forecast is a prediction of the future. A budget is a planned outcome that your business wants to achieve.
Why should I have a budget?
To help you to
- manage your money effectively
- allocate appropriate resources to projects
- monitor performance
- meet your objectives
- improve decision-making
- identify problems before they occur – such as the need to raise finance or cash flow difficulties
- plan for the future
- increase staff motivation
Are you budgeting correctly for the short, medium and long term future of your business? Talk to us about setting up a budget and using it to map your path to success. Get in touch. You’ll be pleased you did.