budgetforecasting

Does your Business Need a Budget?

 

I’m Donna Bordeaux with Calculated Moves and I wanted to discuss with you today an important subject that I get asked about a lot; and, that is about Budgeting.  Many people say I have to have a budget.  And when I ask about what types of things you’ve been struggling with, they say, “I need a budget. I don’t have one. I really need to get the time where I can set up a budget. All right then, your mind is going to be blown. We’re going to fix this problem in less than five minutes!

First, I’m going to tell you, unless you have a staff of people working under you that have the authorization to spend your money, you do not need a budget. As a small business owner, typically you’re in charge, you’re spending your own money.

Let me give you an example of how this works. Let’s say that your budget for office supplies for this month is $150 and your printer just ran out of toner and you need to buy a new cartridge. But that will push you over your “budget”. Is the answer to leave your printer without toner until next month? No! You’re a small business owner, you’re smart. You can make those kinds of decisions and make calls on what you need to spend money on, versus what you might want to spend money on. A budget, in that case, would be an exercise in futility. You will not need a budget. In budgeting, the answer is using your brain, figuring out what you need to spend your money on; and, prioritizing the wants versus the needs. So, if you have that item on your list where you need to do a budget for your business, check it off; it’s done. You don’t need one. Your CPA told you so.

Now one other thing I’ll mention is that a lot of times when people say they need a budget, they really don’t mean they need a budget for spending. What they really mean is that they need a forecast for what they want things to look like going forward. Remember, that those are two different things. I’m okay with you having a forecast, which starts with you forecasting your sales and then looking at the variable expenses that go right along with your sales. Your fixed costs should remain about the same unless you’re planning some larger expansion. If you need help with forecasting, that’s a whole different ballgame. Please let me know. All right, so we’re under our five minutes. We’ve conquered that task for the day. Move on. Open your mind to something new.

 

Donna Bordeaux
CPA with Calculated Moves

 

Creativity and CPAs don’t generally go together.  Most people think of CPAs as nerdy accountants who can’t talk with people.  Well, it’s time to break that stereotype.  Lively, friendly and knowledgeable can be a part of your relationship with your CPA as demonstrated by Donna and Chad Bordeaux.  They have over 50 years of combined experience as entrepreneurial CPAs.  They’ve owned businesses and helped business owners exceed their wildest dreams.   They have been able to help businesses earn many times more profit than the average business in the same industry and are passionate about helping industries that help families build great memories.

Photo Credit: Shutterstock