Hi, Helen Cowley here!
Having cash flow problems? Not knowing your numbers? Not knowing your profit and loss? There is one solution that can help you gain better control - Budget!
Okay, so you have just purchased your business or have a small business and you know your trade but when it comes to bookkeeping or (more importantly) budgeting you skills are lacking? Well their is good news for you, it isn't really that hard!
Budgeting is all about estimating and matching expenses to revenue. If you don't have this, then how are you supposed to know if your business adventures are paying off for you? The revenue you create pays the expenses that you need for your business to run.
To put it simply:
High Expenses + Low Revenue = Low or no profit
Matched Expenses + Matched Revenue = Steady Flow
Low Expenses + High Revenue = High Profit
Not Knowing your numbers = Not knowing your business
Now, I am not saying don't have expenses - every business has them but if you don't know or understand your expenses and revenue their is a serious problem! All that hard work and effort that you have been putting into your business could all be for nothing.
I am not here to tell you how exactly your budget should be set out
because everyone has a different situation. But, their are some things that are common throughout all business owners. Their are things such as; rent or mortgage, utility bills, payroll expenses, interest and tax payments and the list goes on. The point is that every business (no matter what stage they are at) should know what these bills total out to be. Without it your bound to go bust!
Tips:
- Check Industry Standard
- Make a Spreadsheet
- Factor in Slack
- Look To Cut Costs
- Review The Business Periodically
- Shop Around For Services + Suppliers
I hope to be hearing from you soon,
Helen Cowley.
No comments:
Post a Comment