Blair Morrison, CEO

6 Questions to Ask Yourself ...

I have built hundreds of budgets and projections for businesses (yes, that many!). After the first 50 or so, I found myself asking a key set of questions. Here are the top six most important things to think about when building a budget.
  1. How will revenues this year be different from last year? Make sure to consider what’s happening to other businesses in your industry. Is there a slowdown on the horizon? Or are things booming?
  2. Will we be hiring or firing any people over the next 12 months?
  3. Will we be making any changes to our day-to-day operations, moving to a new office space or buying more equipment or furniture?
  4. Will our customer profile or product mix be different this year? If so, take a close look at your more recent month gross profit margins to see if the new customer or products are more or less profitable.
  5. What other major changes am I making or will I be making to my business?
  6. Are there any goals that I would like to set for myself this year? Goals can be anything from faster customer collections, more cash, higher revenue, or a tighter rein on expenses.
With the answers to these questions you can take the information from last year’s actual financials and use that data to build a picture of how your business will look this next year. Once you’ve made a list of all major changes in your business for the next 12 month, you are ready to get started on your budget in AutoCFO! Here’s a quick how-to guide on how to create your budget.