As a prerequisite for the existence of a business organization
A business organization must build such a detailed revenue budget that each function in the organization will have quantitative and qualitative goals that can be tracked.Through a series of clear indicators throughout the year and predict the pace of progress compared to budget targets. As a business owner, it is recommended that we examine all revenue parameters. Profitability and expenses at any given moment in order to understand if his business is in the right direction to achieve its goals. Such a plan should be detailed at such a level that every official in the organization knows what their role is, what their goals are, and what they should do to achieve them.
Iron rule
Failure to meet the revenue and profitability target will require spending cuts. In 2009, the Israeli government set a target of green electricity generation. The target set by 2020 was to produce about 10 percent of the economy’s output, but in practice the performance is about 7 percent. Last year, IEC announced it was breaking the record for electricity generation derived from renewable energies.
This is a specific peak recorded on one of the hottest days, when total “green” electricity generation in the economy was about 27% of total demand. Although the achievement happened because of a specific event, it proves that the target is yishim and the government, like any organization, must meet its objectives.
What business organizations should learn from this
The correct budget should be made up of 2 types of targets:
1. Revenue and profitability target.
2. Expense target.
What is important that we take into account when building a budget
Revenue
- Desired sales rate based on previous year’s performance.
- Growth or decrease rates (with regard to the state of the market and competition).
- Number of working days per month.
- For example: the sales target in January cannot be the same as in the months when there are holidays and vacations.
- ARPU – Average subscription revenue and forecast is expected to erode at what rate compared to last year.
- Each product must determine a profitability rate and direct salespeople both at the target level and incentives to sell the most profitable products.
- What’s each salesperson’s Capacity?
- How many meetings does he do a day?
- How many deals does he make out of the meetings?
- What is the sales “funnel” and what is the pipe line of future transactions.
- Customer abandonment rate.
- Rate of upgrades and lows of existing customers.
Expense:
- Payroll costs, office, etc.
- Sales commissions and resellers.
- Marketing and advertising costs.
- Investments in new products, technology, etc.
In addition, a work plan should be built that includes an orderly Gant that will support the company’s goals.
Why are we?
Our experts make sure to sit down with the relevant parties in the business and discuss all these questions and other questions.
They perform an in-depth analysis of the answers and in-depth familiarity with the specific needs and characteristics of your business.
They then formulate all the insights and recommendations that are best suited for you and your business, Through all of these, it is possible to embark on a joint path of building a marketing strategy and business development, including addressing the points of failure in the organization and improving work processes.
This move will allow you to maximize your business goals and business.
