Question: The basic reason why anyone starts a business is to make a profit. In order to achieve this goal, it is very important that a
The basic reason why anyone starts a business is to make a profit. In order to achieve this goal, it is very important that a business maintains good budgeting practices. If you correctly select a budgeting strategy, then naturally if the company is bringing in positive revenue then you will see growth. However, poorly managed budgets with incorrect budgeting strategies will lead to losing track of funds and could very well be the down fall for a company. With so many techniques, a business must choose a budgeting technique that fits their business model and practice. For example, a small business may find zero based budgeting beneficial as you must keep track of every single aspect of your inputoutput This allows you to keep a very tight grip on your budget. However, naturally this will take time, effort, and knowledge that may be better suited for a larger business that can staff financial employees to specifically balance and track budgets. A company must consider the how they are profiting. If it is product based, choosing a technique that is better suited to track inventory will be essential. With a business that is service related, you may have to consider other various unique situations that may effect budget tracking more than if you have a fixed product. It may make sense to adjust budget strategies and techniques as a company grows. If a company takes off quickly, do you have the people to make a zero based budget work? Or do you have to pivot to a flexible budget strategy to compensate the change? These are essential questions all business owners, operators, and managers must consider when choosing and implementing budgeting strategies. Do you agree with your classmates assessments of budgeting techniques in relation to an organizations performance? Why or why not?
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
