Spending Plan or Budget
When business is doing fine, spending decisions are easy. But what happens when business dips or unforeseen circumstances occur? We have a systematized budget that will more than prepare you for what the future holds and allow you to take the emotion out of spending decisions. But don’t wait until business is bad to do it because it will be too late! See 10 Reasons a Clean Set of Books and a Budget Spell Freedom to a Business Owner. (link italics)
We look at previous periods to determine what is “normal” for your business and use this as a starting point. We then create a budget that fluctuates when you are operating anywhere between 50% of normal and 150% of normal. This means that if things don’t go as planned, your budget doesn’t go out the window with your plans. There are certain principles that we teach as part of our budget to ensure that you are spending just the right amount for people expenses and non-people expenses while creating enough profit to be able to set some aside for four purposes: to re-invest in the business, retain in the business, save for tax time so there are no surprises and you don’t have to fear making money, and take some home to enjoy as the fruits of your labor.
What’s more, this plan creates a system which allows you to be away from the business more because the system manages your people rather than you having to manage them. It also leaves them feeling fulfilled because they are empowered to help the company succeed and a bonus system is built right into the plan if you choose to use it.