Your business goal is one of the most important factors in determining your budget. As the saying goes, how are you going to get somewhere if you don’t know where you’re going.
Your revenue business goal provides the basis of your budget. By working from your goals and your current expenses, you can estimate what your next year will look like.
So, what do you want for your business? What do you want for you, out of your business?
How To Set Your Revenue Business Goal
Let’s reverse engineer this. What do you want from your business? What would be ideal for you? Think in terms of your lifestyle, revenue, and social goals.
Once you’ve come up with an amount you want to earn, decide if that amount is before or after taxes. If it’s before, add 30-40% for taxes.
Is that goal more than you earned from your business last year? Is it less? Calculate your variable expenses using your goal. Will you have to make any changes to your fixed expenses to be able to do so much business?
Finally, add everything together to get your revenue goal for the year:
Your Variable Expenses (for your business goal)
Your Fixed Expenses
Your (personal) Income Goal
Your Projected Taxes
Total Business Revenue Goal
Now that you have your business goal, what can you do with it?
Play with your business goal to come up with sales goals for your products and services. Chop your goals up into weekly chunks and track your progress each week.
That last part was really important so I’ll say it again.
Track your progress on your goals each week.
It’s simple. It’s easy. It will take you 5 minutes each week. But it’s important so don’t skip it.
Share the progress with everyone in your business who impacts sales.
Find your revenue goal for your business and make a tracking sheet.
That’s the simple way to budget for your business. If you missed any of the earlier articles, check them out below.