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We serve salon owners, distributors, equipment manufacturers, and public consumers across the globe. BUYERS BENEFIT from the best source for all of your tanning equipment and supply needs. SELLERS BENEFIT from our diverse resources in acquiring and moving your equipment.

May 11th

Most owners don’t like the financial side of managing their business. Who wants to wrestle the ins and outs of discounted cash flow, net operating profit, retained earnings or zero-based budgeting?

But in today’s increasingly downsized businesses, you need to be somewhat savvy about financial analysis. Whether it’s tighter inventory control or analyzing the financing of equipment, more financial input may soon be required of you.

Budgeting is one way to manage your finances. While no forecast is perfect it will hold you accountable. The challenge with creating a budget depends greatly on market trends and predicting trends is very daunting.

How can we prepare a budget that will reflect our business goals, include market trends and still be relevant in 12 months? Below are 6 tips to help you get there.

  1. Have a business plan. Call it Goals, strategic or vision, it doesn’t matter but the budget needs to support the plan. If you want to grow by 15% the budget needs to reflect how you are going to do that. Are you going to cut expenses by 15% because you want or does it mean you need to find 10% in new revenue?
  2. Understand your history. Determine if you have seasonality in your revenue and/or expenditures. Make sure your historical “look-back” includes several years. It’s important to build your revenue and expenditure around those peaks and valleys. If you are a smaller business and don’t have a CFO or Controller in your company lean on your CPA/Accountant to help you in this area.
  3. Get cloud bases accounting. In todays ever-changing market it’s important that your financial information is available in real time. Cloud based accounting is instantaneous, allowing accountants, bookkeepers and owners access in real time.
  4. Be flexible. Understand that your budget needs to be flexible as the market is always changing. Take time to evaluate how your budget is performing to what is actually happening and adjust accordingly.
  5. The best budgets are created by a team. All department leads need to be involved in the budgeting process as ultimately they will be the ones being held accountable for achieving it.
  6. Use budget-planning sessions. Take your sessions outside or work. This will create space for fuller discussion. Do not discount the importance of these sessions. It’s good to get the collective juices all in one space and on the same page.

This entry was posted in Business Consultations, Salon Owners, Tanning Consultants, Uncategorized and tagged , , , , by 2nd Sun Tan. Bookmark the permalink.

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