In order to set your business up for success in the New Year, you’ll need a very solid budget. Forecasting your income and expenses on a monthly basis, for the entire year, is the first step toward strong financial performance.
After giving considerable time and attention to the construction of an annual budget, the next most important step is to consciously manage your business using the newly developed budget. While you can make adjustments and course correction throughout the year, it is best to first freeze spending prior to revising your forecast. This should be done on a quarterly basis.
Managing your business based on the budget you create is paramount! Arguably there is nothing more important to the growth and success of your business than managing your business based on a well-constructed budget forecast. Given this, allow your budget to be the guiding light to margin growth and profitability for your business.
Importantly, take steps to consistently review the budget and make income/expense adjustments to realize the gains outlined in your budget. Ultimately, your budget should become a living and breathing document used to provide proper guidance toward business profitability!