Creating a budget is a good management tool for your business
The budget will give you and your business an overview of projected expenses and revenue for a given period.
Why create a budget?
In order to steer the business in the right direction, it’s important to have an overview of what the plans of the company are. In regard to both sales and revenue, as well as on the expense side. This way you can easily see how much you can spend on the various items and also allocate the revenue during the year.
How do you create a budget?
You should start out with last year's figures, before you sit down and look carefully at how you believe the current year (or other time period) will be. Will there be changes in income, expenses, number of employees, business premises, production costs or anything else? All of this must be included in the budget.
By creating a budget, you will e.g. be able to identify the cost drivers in the business’s operations. For instance, you can budget based on the activity level, e.g. "how many sales meetings can we manage” and "what does an average meeting cost."
In this way you can manage and strategise your company well.
We have many years’ experience in helping our clients create a budget. Contact us so we can help you.