Have you calculated the full cost of all loans, including overdrafts, fully drawn advances and mortgages?
	Have you calculated the full cost of hire purchase and leasing arrangements?
	Have you fully assessed your fixed costs (rent, insurance, telephone, etc)?
	Have you assessed your variable costs (materials, labour content, car expenses, power)?
	What is your break-even point?
	Are prices set at a level that will achieve a real profit?

 

Budget Components

A properly detailed budget will reveal what prices should be charged to cover all expenses and yield a profit that is commensurate with the effort expended by the owners and the financial risk they take.  A good business budget will include:

	A sales budget.
	A product or service budget.
	A profit and loss statement.
	A cash budget.

Use historical figures as a starting point or, better still, start from scratch.  include all costs of labour, including holiday leave, payroll tax, etc.  Make a conservative estimate of future turnover.