Small Business: Essential Business Planning – Part 2 Resources

Preparing a Budget – Resources

Now that you have set a budget for sales it’s time to ask yourself what resources are needed to achieve your plan. By reviewing the resources you can incorporate any changes into the cost side of the budget before finalising this.

Key questions for resources

Are the premises big enough? If not you may have to negotiate with your current landlord to terminate an existing contract and look for bigger premises. This will all take time and forward planning will ensure you minimise additional expense.

Are there sufficient staff? Looking for additional staff can be expensive, recruitment agencies often charge as a % of the starting salary. With the benefit of time these costs can also be reduced, some firms offer incentives to existing staff to put forward candidates for job vacancies and in many cases this can prove much cheaper and more reliable than the recruitment agency or general advertising. “Good people know good people!”

As well as the cost of recruitment additional staff are often not as productive in the first few months as they require time and training to be best utilised depending on your industry and business practices this can be up to 3 months before they are fully operational. This is particularly relevant to service industries where staff are often fee earners.

Do they have the right skills? Identify the skills needed in the business going forward is essential for setting training budgets. Discounts are offered for multiple attendees or purchasing multiple courses with the same supplier.

Do you need to invest in more equipment? Or even a replacement strategy for the existing equipment? This will possibly require additional funds or a financing agreement that will incur interest and other charges. With prior notice you can achieve better and cheaper financing by virtue of choice and prior planning. Getting quotes in advance and finding out their lending criteria.

All of these questions and more will need to be factored in when setting the budget for the coming year and these will all have an impact on the costs of the business.

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