UGH! The numbers aren’t what you budgeted, now what?!?
There are a few things to think about: #1 Were your budgeted numbers realistic? Were they based on good data or just wishful projections? How did you create that budget?
Sometimes we don’t allow ourselves enough time to build business. Fraser Sherman, with Bizfluent.com tells us that “standard advice is that you should prepare to run three years before you reach that point.” (profit) Each business is different, each business owner’s needs are different, which is why it is hard to say with certainty when to expect to be profitable. At least we have a guideline, that government statistics and business writers agree on – about 3 years before you should expect to turn a profit.
#2 Hopefully, when you created your budget, you set “markers” to let you know if you are on track. If those markers are not being met, we need to dig deeper.
There are many reasons you might not be on track. Are expenses higher than you estimated? If so, why? If this is an error on your part, re-write your budget with the new numbers and set some new “markers” or benchmarks.
Are your marketing efforts working? Have you created a way to track your marketing? This is very important, and difficult with today’s social media opportunities. Get the pixel, create promotional codes, watch the stats that each digital site offers to show your marketing works. If its not working, ask yourself, “Why not?” You might just need to tweak a few words that will make a huge difference.
Maybe you are using the wrong channels. If your client base is age 60 plus, Instagram isn’t where you should be spending your time. Even Facebook is iffy. You will need to use direct mail pieces, newspaper ads, events that you can participate in, things that your market will see.
Are your reports tracking properly? What I mean is, if you are a restaurant and you are tracking per person averages, are the servers entering the correct number of guests? Get what I’m saying? If you are tracking number of steaks you sell, are the servers entering “open food” because they need to modify it and you haven’t created the right modifier? Make sure you are entering the data right if you want to get an accurate report.
And, guess what? The fact that you are looking at your reports and comparing them with the budget is a great thing, whether they match, or they don’t! You are doing what you need to be doing. Remember, a budget is a living breathing document. Check it, do what you can to reach it, and adjust when needed. This goes for if you are doing better than budget, too! If you budgeted too low, give yourself some higher goals. Stretch yourself and make your dreams come true!
Here’s to your success.