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3 Reasons Business Owners Hate Budgeting

By Service Excellence Training 3 Reasons Business Owners Hate Budgeting
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Budgeting is a vital part of owning any business, but for many that are outside of the financial industry, it can be viewed negatively. The pressure and confusion of making a budget for your family can be difficult enough, and that’s without the added pressure of making such complicated decisions for your business. You may think that the common dislike of budgeting is due to the handling of complex financials, but it’s more likely because you’re focusing on the wrong aspects. Explore the three real reasons why leaders hate the budgeting process — and some tips on how to make it less of a chore!

#1- Overly-Complicated Budgeting and Forecasting Tools

Budgeting and forecasting tools are usually too complicated for the average person. We aren’t professional bankers or accountants! Most often, budgets are built in an excel spreadsheet that breaks too easily, are in formats that are not easy to read or could even be handwritten worksheets given to you without much instruction by your CPA. These worksheets are never easy to use, and often have complex instructions. You may rely on your operations software or an accounting program that needs too much detail. These details aren’t always collected up front or are difficult to access after a service call has been completed.

Budgeting and forecasting doesn’t have to be complicated. In fact, it can be easy with the right tools in place! A one or two-page spreadsheet is really all you need. You should be able to use this same tool year after year by updating it with current numbers.

#2 – Untracked and Undefined Key Performance Indicators  

Are your Key Performance Indicators (KPIs) clearly defined? You should have a clearly defined KPI for average ticket amounts, closing rates and booking rates that you need to hit on every call for your business. Without a good forecasting tool, you can never clearly define your specific KPIs.

How many calls do you need? What average ticket do you need to hit? What closing rate? And those KPIs need to be set by you and the rest of the leadership team as clear indicators of success for your business. Remember, no two businesses are alike, and they shouldn’t be treated that way.

#3 – Too Much Focus on the Numbers

Most forecasting and budgeting classes focus too much on the numbers without any care or context behind what the numbers mean. Numbers are important, but they must be applied with real-life lessons. Some people and software teach classes about the numbers, but they’ve never done anything in a real business. They are missing the essence and heart that is needed in business.

Moreover, any number on a forecast can only be achieved through activity. Someone in your business has to do something — they have to put in the work. Your business is more than numbers. It’s hours of blood, sweat and tears, and the context behind each of those numbers is important. You might have a particularly low month because you had a sick kid at home or a high month, but it was at the expense of burning out one of your best techs. You are more than just points on a spreadsheet.

Want to Learn More?

The Owner’s Series hosted by the coaches and experts at Service Excellence Training will have you forecasting and budgeting with ease! Embrace budgeting and forecasting by getting an easy to use forecasting tool. Learn your specific company KPIs, and learn from seasoned industry experts.

In the program you will:

  • Learn a budgeting and forecasting process you can use every year to take control of your future.
  • Establish the KPIs – average ticket, closing rates, and booking rates – you need to hit on every call for YOUR business.
  • Get an easy to use budgeting and forecasting tool you can use for years to come.

 

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