Now is an ideal time to start setting your 2015/16 budget. MYOB EXO and MYOB Advanced have powerful budgeting functionality, but even the best functionality is ineffective without a realistic and robust budget.
No-one likes ‘losing’ or chasing unrealistic goals. You might have a ‘dream’ or ‘stretch’ budget but the one you share with your team should be based on reality. It should be hard to achieve and be based on ‘most’ things going right, but revenue growth can only occur if the target is underpinned by actual activities that if executed correctly will get a result.
I create a new forecast every quarter and report against that. Having a growing business can mean things change quickly so why not ensure your targets (budget) are adjusted accordingly and remove the element of surprise. Business owners, banks, and accountants, don’t like big surprises. In business even pleasant surprises can reflect poor budgeting. If you really look closely at the budget and take into account prior years, current trading conditions, and sales initiatives, you can forecast very accurately. Consistently achieving results that don’t wildly fluctuate from the expected (budget) breeds confidence. Confidence for you and your team.
To truly understand what’s driving your business results month-by-month you’ll require further and deeper analysis and it will vary depending on your industry. If you’re a job-based business you’ll look closely at profitability by job, labour costs, unbilled jobs (WIP) and more. Wholesalers would be looking at sales and margin by product category / customer / sales rep to identify non-performing areas.