Building a Better Budget, Part 1: The Process and the Plan

May 2010
by Marion Gropen

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SKILL SETS: BUDGETING

Building a Better Budget, Part 1: The Process and the Plan

by Marion Gropen

Building a budget is arduous, and many smaller publishers avoid it, feeling that it is only a waste of time. After all, as owners of small publishing companies, most of us have a good idea of their financial status, and good ideas of how much we need to sell and what limits our spending must observe if we are to be, and to stay in, the black.

That attitude, however, misses much of the point of the budget process. Many benefits of budgeting lie in the things you learn during the process of building the spreadsheets and analyzing them. After you have built your budget documents, you can use them in a variety of ways, and these also confer benefits.

So, what is the basic process?

In essence, you:

• Develop your strategic plan for the midterm future (not just for one year, but for

three to five years).

• Add tactical specifics to that plan for the near term (one to two years).

• Test that plan for viability.

• Add yet more detail, down to every expense line in your income statement for each

month. (If…IBPA Members – Click here to view the full article (login required).

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