Your budget is one of your most important business tools. A failure in a budget can mean a failure in your business, which is bad news for business owners across the country.
With Statistics Canada finding that 49 percent of new businesses don't make it past their fifth year, the onus is on business owners to educate themselves on how best to keep their businesses lively and give them a good chance of success. A good budget is one way to do that.
So why is a budget so important? And how can you manage yours effectively?
Why your budget matters
Simply put, your budget gives you an overview of your business' real and expected cash flow, income and expenditures.
Your budget helps you to plan for the future, while the real time data you enter in your records will show you where your money is coming from, where it is going, and whether there are any problem areas to take care of. A good budget helps you to keep your goals in sight and see if they are achievable.
Your budget will also give you the knowledge you need to anticipate peak periods and slower periods in your business, allowing you to plan accordingly. So how do you get your budget up to scratch?
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How to manage your budget effectively
Budgeting can be a drag, but with Intuit finding that the biggest regret for small business owners during their first year is not upgrading their financial skills, there has never been a better time to start managing your budget better.
Try out these 5 ways to be an even better budget manager:
Budgeting may seem boring, but it's time well invested in the future of your business.
A realistic and flexible budget can help you to run your business better, maximize your profits, and anticipate what is coming next, keeping you safe from unwanted surprises.
About the author
Tristan Anwyn is an author who writes on subjects as diverse as health, marketing, business, and SEO.