Creating good budgeting is easier said than done. Basically, it comes down to determining revenues, expenses and profit targets. Anyway, in practice, it is obviously not that simple, because you also have to decide which investments will lead to better results. In this article, we provide tips on how to make good budgeting, which are applicable to any business!
Analyse historical data
One of the most important factors in creating good budgeting for your business is analysing historical data. These can help you tremendously in managing expectations. And we can extend this very widely. Let’s give some examples. It’s up to you to think what you can analyse in your sector.
– At sales peak and off-peak moments when your shop or warehouse is very busy.
– When certain products run well (think Christmas, summer, et cetera).
– At service times when many or few staff are needed.
– When many employees call in sick or are on holiday.
– What are expensive periods in terms of investments, or when a lot breaks down.
– What are periods that actually make a lot of money, and why that is.
Use tools for historical data and forecasting
The above tip for budgeting may sound smart, but how do you approach it in practice? Fortunately, you don’t have to do that manually, because you use tools. These can store historical data for you, and make forecasts based on it. This is also known as forecasting.
Forecasting as a basis for good strategy and budgeting
Forecasting is a good basis for setting realistic goals that are financially feasible. It also shows you what were good investments in the past (e.g. advertising campaigns or purchase of machines), and which investments did not pay off.
But so it also helps you schedule staff smartly, so that you don’t unnecessarily hire too many employees (after all, they need to be paid and that comes off the budget). On the other hand, it also helps to employ enough employees, as poor service can lead to customer loss.
Forecasting as part of Workforce Management
Forecasting is part of Workforce Management. This includes, for instance, capacity management, scheduling, reporting and analysis. Because, as we just pointed out, it is also important to deploy staff smartly: neither too many nor too few staff ensures maximum profit and a minimum bite on your budget.
Additional tips for good budgeting
We would like to conclude this article with some additional tips for good budgeting. For instance, it is smart to monitor regularly. Notice that the budget is not optimally set up? Review and adjust.
In large organisations, it is also definitely smart to involve the teams in the process. Department heads often know what is (un)necessary in terms of budget for their department. Keep thinking realistically and clearly yourself, because they can also try to release as much as possible. So ask for good substantiation!
It is also useful to think about major expenses in advance. What is coming up in the coming year? Do you need new equipment, because something is likely to break down or because better equipment is coming onto the market? This may also make the work go faster, which could actually save you money. Also plan a post for contingencies.
Finally, as we mentioned earlier, it is smart to invest in a good forecasting tool. Dyflexis’ Workforce Management System is designed to help you make powerful forecasts, schedule staff and determine proper budgeting. Experience it yourself!
Can’t figure it out? We will completely unburden you! With Dyflexis, you always have access to all functionalities, including laws and regulations. Request a free demo and discover for yourself the advantages of the Workforce Management System for proper budgeting.
