The sheer thought of making a budget may be enough to keep you awake at night, but without it, you and your small business will likely fail.
Strong words, but very true. The art of budgeting is the back and forth between goals and reality. An experienced coach will listen to your goals, work with the numbers; ask you to work with the numbers and help you develop a preliminary budget. This is the beginning of a financial plan for your business.
Preparing the budget requires you to look at each item and think about everything from advertising to copier’s. Justify each expense. Consider the alternatives for every expenditure. Project as accurately as possible the sales and revenues you expect. This is the beginning of coaching for growth.
Sometimes the budget cannot be balanced in traditional ways. The Budget Coaching process helps you to think of new techniques, new uses of technology, new processes in order to make the most of your business. It may show that you need to borrow, or that your vision of the sales is unrealistic. It may unfortunately show that your business cannot make it. A hard, but necessary part of coaching is to say when things look doubtful regardless of the options or the amount of coaching that can be done.
Comparing the budget to the actual amounts on a monthly, quarterly or annual basis lets you and your budgeting coach make continuing corrections to what has been done. For example, if the actual advertising expense is $1,000 and the budget is only $750, then you and your coach need to find a way to save $250 from the next period in order to keep the budget in balance.
Sometimes the budget itself should be corrected, to reflect increased income, which might produce increased expenses.
How does the coach help with this? This process creates anxiety for those closest to the numbers, because it means giving up something in order to get something else. The coach is the “someone” who steps back, takes the deep breath, and then brings you back to the reality of what your business is about. Your coach helps you focus on the budget. He asks the questions about what you need and what you can do with out or put off. Coaching brings back the sanity to your process.
What could be a better collaboration?
Finances, Coaching, and Taxes.