Give your business a solid foundation, starting with your budget
Getting a business on its feet is both exciting and exhausting. While the excitement wears off over time, it can still be exhausting if you don’t have the right tools in place to keep your business on track—and that’s where a budget comes in.
“A budget has many benefits—it focuses on the direction you want your business to take and provides targets to help it grow,” said Keith Bookbinder, Managing Partner of LVBW. “Your budget will provide information to support management decisions and give you a means of monitoring and controlling performance and growth.”
A budget is a projection of monthly or quarterly costs and expected income. If you have an established business, it shouldn’t be too difficult to come up with a figure for the annual income from previous years, or to plan how that income will be spent based on expenses. New businesses should be able to nail down expenses fairly easily, but will make assumptions as to what their income will be.
“Establishing a budget, or even polishing a basic budget down to something that serves you well, may seem overwhelming,” Bookbinder said. “That’s where our company comes in—we have years of experience in helping businesses refine budgets into plans that help them concentrate their resources on improving profits, reducing costs and increasing returns on investment.”
Budgets are not documents you put up on a shelf and dust off every once in a while. They are meant to be reviewed and revised frequently so you can successfully manage cash flow, identify changes that need to be made in the next budgeting period and plan for capital improvements or expanding your business.
“Your budget should also give you a means of comparing how different divisions of your business are performing and how your company stacks up against other companies in the same industry,” Bookbinder said. “It’s the foundation of your business—make sure it’s solid, frequently check for cracks or leaks— and it will serve you well.”
For more information, go to www.lvbwcpa.com or call (716) 204-9000