Ep.107 - Making Bank — Because Budgeting is Boring

When you are learning about your business financials, you have to get into the nitty-gritty stuff. You are fully capable of learning the metrics of your business because that’s what’s going to move your business forward. 

There are nine foundational pieces when it comes to forecasting and budgeting for your business. 

When it comes to running a business, you need to have financial goals that you keep in mind. Doing this in addition to reviewing your historical data, estimating your sales, projecting your expenses, and managing your cash flow, you can create a realistic budget aligned with those goals. 

Once that budget is set, it doesn't stop there. Be sure to regularly monitor your financials to make adjustments as needed when the unexpected happens. Also, take the time to plan for the unexpected, it will take a lot of the emotional weight off of you if it does happen. If this feels really overwhelming, just know that you can do it, but you can also seek professional advice from experts who understand the complexities of your business.

Financial forecasting and budgeting is an iterative process. Continue to inspect your financials month over month in order to direct your business so that you can get it where you want it to go. When you understand the financials of your business, you are better prepared to navigate your business and make informed decisions.

If you want some more guidance as well as some helpful spreadsheets to get things started, check out The Pilot Project.

• The importance of defining clear business goals and objectives, such as revenue targets and profit margins, as the foundation for forecasting and budgeting efforts.

• The significance of analyzing historical financial data to identify trends, seasonality, and insights hidden within sales, expenses, and cash flow records. 

• The process of creating revenue projections based on factors such as market demand, pricing strategies, sales pipelines, and historical sales data. 

• The importance of creating a comprehensive budget that aligns with business goals, covers short-term and long-term needs, and factors in all expenses, both fixed and variable.

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