Business Planning & Budget Planning

A business plan is necessary for three primary reasons:

 

  • It gives business owners a current assessment of the business as well as a roadmap for the future.

  • It helps a business grow, both organically and through outside funding.

  • It is essential to have an up to date business plan in order to secure financing, ranging from an overdraft facility or bank loan to venture capital funding.

 

The business plan/budget is a living document that should be continuously reviewed in light of the business environment and actual performance. In addition there should be formal reviews on a quarterly basis. This enables the directors to oversee business performance.

 

Creating a budget

Begin by asking these questions:

  • What are the projected sales for the budget period? 

  • What are the direct costs of sales?

  • What are the fixed costs or overheads?

 

You should break down the fixed costs and overheads by type, e.g.:

  • cost of premises, including rent, municipal taxes and service charges

  • staff costs 

  • utilities 

  • printing, postage and stationery

  • vehicle expenses

  • equipment costs

  • advertising and promotion

  • travel and subsistence expenses

  • legal and professional costs, including insurance

GemSites can help you with everything required to create your business plan; a realistic and methodical budget and; monitor performance against both. 

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