A Business Budget Plan is a financial plan for an organization’s expenses and revenues. It is expected over a specific period of time or in the future. A well-planned budget helps a business estimate spending, identify present capital, and predict revenue for the future. It helps a leader to understand how his/her company is performing. Budgeting in your business is very important to control future cash flows and make well-operational decisions. There can be also many key expenses and costs that an organization contains in its budget plans.
A business budget can help the owner plan his company’s activities and can act as a measure for setting up future financial goals. However, it can help them to tackle both short-term and long-term obstacles.
Importance of Business Budget
As we know, all businesses depend on a well-planned budget. Using it, you can forecast your cash flow and expenses in business so that your company’s management can make decisions for financial operations. By having a good budget plan, your company can avoid or decrease debt while making opportunities for investors and loans. By reading the following rules, you can predict the importance of budget in your business.
Control Cash Flow
A well-settled business depends on good budgeting to efficiently control its cash flow. The revenue of business coming and expenses going are essential measures that can impact the business’s financial health. So, reviewing and evaluating the budget on a time-to-time basis will help the company better plan for growth and profitability.
Hand Out Resources
We know that a budget gives a data-based outline of revenues and costs, and a business can better define were to hand out operational funds and resources. For example, a business determines budget analysis and its marketing strategies.
Evaluate the Performance
A good budget plan will help your business to compare past and present processes to evaluate performance. For example, when you compare your company’s revenue from the past to present time income, you will be able to evaluate strategies and outcomes to make better decisions for the future.
Boost Your Decisions
A well-planned business budget helps to make decisions that concern the operation and financial health of your company. With this comparison, you will be able to make more informed financial decisions for your business’s future financial health.
Identify the Risks
When you compare your company’s previous spending and current expenses, you can identify potential risks and create solutions before arise. However, your well-planned business budget will help you to keep your company staff aligned with the management goals.
Types of Business Budget
Here are some different types of Business budgets and how they play a role in planning a budget for businesses.
1. Master Budget
This type of budget is an association of lower-level budgets created by many functional areas in a company. It contains inputs from financial strategies and statements, the cash flow, and the financial plan.
2. Operational Budget
An operating budget indicates a company’s projected income and expenses over a specific period of time. Moreover, it can be a profit and loss report. An operating budget contains fixed expenses, non-essential expenses, variable costs, and capital costs.
3. Monetary Budget
In this type of budget, you can understand how much capital you’ll need and at which times to fulfill short-term and long-term needs. It must include the assets, liabilities, and equity of stakeholders.
4. Labor Budget
This budget type will be used to hire employees to achieve the company’s goals. It will help a company to identify the workforce a company requires to achieve goals so it can plan the payroll for all the employees.
5. Fixed Budget
This budget will help to estimate revenues and expenses that are fixed for a specific period of time. However, a fixed budget is mainly prepared for nonprofits educational institutes, and government sectors for a fixed amount to use in the future.
Free Business Budget Templates
Here, you can download some of the exclusive samples of Business Budget Templates for free of cost.
Template No. 01 for Business Budget
Here is an elegant Business Budget Template for a small company. This template is designed in a Microsoft Excel file and is fully editable. It will help to track your business income, expenses, and variances for a specific time. However, you just need to enter the values in the cells and the sheet will provide the outcome automatically. Download it for free and use it as your small business budget sheet.
Template No. 02 for Business Budget
Download the following sample of the MS Excel budget plan worksheet for free. Using it, you can easily manage or plan a specific budget for your business. It will help to track your expected amount of expenses and income. Feel free and get it now in a zipped file.
Template No. 03 for Business Budget
This is the 2-year business expense budget worksheet that can be downloaded in MS Excel sheet. The worksheet will help you to track your month-wise expenses. After the last period, the sheet will provide the overall comparison of your previous and present year expenses. Furthermore, the template will also identify the overview of the 2-year expense comparison in the chart given below.
Template No. 04 for Business Budget
This Business Budget Template comes in black and white color and is designed also in Microsoft Excel sheet. You just need to insert your income and expense details according to the given cells, then the worksheet will update the total outcome in place as well as in the chart overview. However, click on the download button to get it for free.
Template No. 05 for Business Budget
Here is another wonderful option for a Monthly Budget worksheet for small and large-scale businesses. This template can automatically update the total of your estimated and actual amount. Also, it provides a summary of the overall income and expenses that you planned for the future.
Template No. 06 for Business Budget
Here is another good option for your business to track its financial goals over a period of the month. The design and layout come in different styles as compared to the previous templates. Just enter the values of the amount of your budget in the sections, and then the outcome of actual, expected, and variance will calculate automatically. Easily download this template for free in a Microsoft Excel file.
