Publishing budget plan vs actual results will make a

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: u included in the market analysis table. CHAPTER 13: EXPENSE BUDGET Budgets are plans. They are spending plans, activity plans, sales plans, marketing plans, all linked to the disciplines of careful projection and resource allocation. Simple Math, Simple Numbers The expense budget is built on common sense and reasonable guesses, without statistical analysis, mathematical techniques, or any past data. The mathematics are simple; sums of the rows and columns. In the example below, each line of expense occupies a row, and months and years occupy columns. The Total expense row sums the individual monthly expense columns. The annual expense column sums the months for each row, including the Total row. SIMPLE EXPENSE BUDGET As you develop a budget, think of it as the part of your plan you can most easily control. Consider your plan objectives, your sales and marketing activities, and how you’ll relate your spending to your strategy. Remember as you budget that you want to prioritize your spending to match your priorities in sales and target marketing. The emphasis in your strategy should show up in your actual detailed programs. That’s your budget. An expense budget can be as simple or complex as you wish. Greater detail in your plan will give you more information about, and more control over, how you spend your money. HURDLE: THE BOOK 13.2 ON BUSINESS PLANNING Budgeting is About People More Than Numbers While budget numbers are simple, budget management isn’t. To make a budget work, you need to add real management: 1. Understand that it’s about people: Successful budgeting depends on people management more than anything else. Every budgeted item must be “owned” by somebody, meaning that the owner has responsibility for spending, authority to spend, and the belief that the spending limit is realistic. People who don’t believe in a budget won’t try to implement it. People who don’t believe that it matters won’t worry about a budget either. 2. Budget ownership is critical: To “own” a budget i...
View Full Document

This note was uploaded on 01/26/2014 for the course BUINESS 102 taught by Professor Unknown during the Winter '09 term at University of Phoenix.

Ask a homework question - tutors are online