Start Out 2024 Strong by Investing Time in Your Business's Budget NowNov 02, 2023
Start Out 2024 Strong by Investing Time in Your Business's Budget Now
By JEA Financial, November 1, 2023
It’s time for reflection and resolution! The end of the year is always the perfect time for that. As a business owner, you know that the start of a new year comes with the excitement of a clean slate and fresh start on your goals. The fourth quarter is the perfect time to identify areas for improvement and take steps toward achieving your goals; we haven’t reached the end yet and there’s no reason you can’t hit your 2023 goals now!
One of the most important steps you can take is to invest time in your business budget. Like it or not, it is essential for setting your business up for success in the coming year. While it may not be the most exciting work, taking the time to analyze your expenses, create a forecast, allocate funds, evaluate your spending and track your results are steps you can take now to cross the finish line in 2023.
- Analyze Your Expenses
The first step in investing time in your business budget is to take a look at your expenses. Specifically, identify what you spent so far and what you expect to spend next year. Review your purchases and make sure they are necessary. If you find areas where you can cut back, eliminate them. This will help you free up funds you can use for other purposes, such as upgrading your equipment or expanding your product line.
Pro Tip: Make a schedule of software and other expenses (like business insurance) that are charged once a year. People often forget these and just focus on monthly recurring items. When you create this annual schedule for yourself, nothing will catch you by surprise!
- Create a Forecast
Next, create a forecast for the upcoming year. Estimate your income and expenses, and make sure they match. Again, make sure that you accommodate for those expenses that are charged annually! This is a great opportunity to identify areas where you need to increase your sales or find new customers and/or clients to boost your revenue. Once you have a clear idea of what you expect to spend and earn, you can create a budget that will help you stay on track. Just like with weather forecasting, creating your financial forecast can help you weather any storm!
- Allocate Funds
Once you have a budget, allocate your funds carefully. Determine what portion of your budget should be dedicated to marketing, staffing, equipment, and other essentials while ensuring that you also have funds for unexpected expenses that may arise throughout the year. If you are looking to make investments in your company's growth, this is the right time to allocate funds towards such growth. Whether it's hiring new staff, improving your digital presence, or expanding your product line, you can direct your funds towards the areas that will have the most significant impact on your business so that you finish 2023 and start 2024 off strong!
- Evaluate Your Spending Regularly
Creating a business budget is not a one-time activity. It needs to be checked regularly, at least once a month, to make sure you are staying within your proposed spending limits and to spot any trends or changes in your revenue or expenses throughout the year. Just as you would any fitness goal, you’re analyzing the actions that you took to get where you are, then evaluate what was getting you closer to that goal and what was sabotaging your way to the finish line. Similarly, making changes to your budget and finances at the right time can help you make better business decisions, avoid unexpected costs and take advantage of new opportunities.
- Track Your Results
Finally, track your budget's effectiveness. Keep an eye on your finances and analyze your business's performance, comparing your actual spending and revenue against your forecast. If you notice any significant differences, you can make necessary changes or address the issue before it becomes a significant problem. Being proactive is key!
Investing the time to analyze your company budget at the beginning of the year can be an essential tool to plan for growth and overcome setbacks in the upcoming year. Remember to analyze your expenses, create a forecast, allocate funds, evaluate your spending regularly and track your results. By taking time to work on your business budget now, you can set yourself up for success throughout 2024. Go ahead, start your budget work, and let's make 2024 your business’s best year yet!
If you need monthly support with bookkeeping and reporting, book your complementary “mini” CFO call with Erica Day.
There is actually nothing “mini” about these calls; they are certain to pack a punch!
These 30-minute sessions are geared to efficiently help you find extra profit in your business, set goals and determine the financial strategies that will best support you in your vision for your business.
The best part? You get to determine how you’d like to spend your session so that we can laser in on what adjustments we can make to powerfully impact your business!
Don’t wait until the New Year to set your business up for success. Take action now. Book your complimentary CFO call today!
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