As the year comes to a close, it’s essential to begin thinking about your budgeting plan for the upcoming year. Do you plan on keeping it the same, or do you need to revise some things? Below we list how to create an effective business budget for the new year.

Review Your Expenses

The first step to creating your business budget is to review your previous expenses. What did you spend the most on, and what was your ROI? If the return on investment of some of your costs were good, it could help you make your decision to increase that expense even easier. Evaluate all significant expenses and consider whether a cost should be lowered or increased if you liked its results. 

Look at Past Revenue

Your past revenue can tell you a lot about what is working versus what is not working. Identify areas where revenue came easy and where months/quarters differed in bringing in revenue. Use this data to help you develop a revenue strategy for the new year. This data will help you know exactly where you can expect a certain amount of revenue so that you can plan your expenses accordingly. 

Create a Strategic Plan

Before fully committing to your new budget based on previous results, identify what business goals you want to focus on for the upcoming year. Your desired results should be specific and relevant, and they could also be based on the lessons you learned this past year. Once you have your goals written out, implement them into your plan and determine the costs and potential benefits of each one. After evaluating your goals, you can begin working them into your new budget.

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Needing a little more customized help with budgeting for the new year? At ActionCOACH Houston Inner Loop, you can expect to gain insightful and valuable information necessary for your business’ success. Contact us today to learn more about how we can help you.