It’s already well into the third quarter, and you realize your budget for 2013 is already in the red. Don’t become disheveled as this is expected one in a while in the business world. Understand what you can do now to avoid this financial hangover in 2014. Start by reevaluating your current business budget. What are expenses that you need to include or take out? Take the following financial tips into account as you create your business budget for the approaching year.
Why does my business need a budget?
Trying to run a business without a budget would be like running a race without tennis shoes. You would have no stability, and wouldn’t make it very far. A business budget allows you to evaluate expenses and adjust accordingly due to performance. A budget also allows to you to measure the success of your company and provides a path for years to come.
What should a budget include?
If this is your first rodeo, taking the time to create your budget will determine the success of your business for the year. A business budget needs to include revenue, costs, profits and cash flow. Also, categorize these expenses separately for organizational purposes. If a discrepancy or an error does exist, this will allow you to nail down and fix the problem quickly. Using a (http://office.microsoft.com/en-us/templates/expense-budget-spreadsheet-TC001061833.aspx) budgeting worksheet helps you stay organized and realize all of the expenses that you will need to include. Once you have created your business budget, share this with your team. It is important for everyone to know what the forecast is for the year so they are motivated to reach and surpass these financial goals.
Create a mobile budget
Just like a business, your budget should not be static. Always expect unexpected expenses. Office supplies, maintenance and employee turnover are examples of items that may differ year to year, and therefore your budget must be flexible and be able to adapt to these changes. Build off of last year’s budget to determine how you will create your budget this year.
Stay on track
It will happen, and there will be a time that you go over your budget. But knowing where the issues lies and knowing how to solve it will make the world of a difference. Hire a professional to help you track your budget. Finance professionals will be able to provide you with advice year round, especially during tax season.
If your budget didn’t work out as planned this year understand how you can already start on a better budget for 2014 with these tips.
Kristen Bradley is a writer for LiveFinancially.com, an online resource for both personal and professional finance.