Finance

The Budget: A Key Point for Every Company

When developing our business, communication with potential clients is a key factor. For this reason, it is important to adequately convey the products or services you offer and adapt to the needs and demands those potential clients. For this, key instruments to develop for your business are budgets. By budgets, you inform the details of your products or services to your clients and the value of their demands and your adjustments to what they are looking for.

Next we will see some of the most used types of budgets:

1. According to the sector in which they are used
The budgets of a company can be adapted according to the sector to which they are directed. It is depending on whether it is the public sector or the private sector. When a company adapts its budget for the public sector it usually tries to get some type of competitions with which they would choose to perform any type of service to the State. Normally these budgets must follow specific rules and are usually adjusted more to win the public competitions.

2. According to its application in the company
Depending on its applicability, budgets can be economic or financial. The economic budgets are made to budget the activities for the following period of the company. While the financial budget includes the calculation of items that mainly affect the balance. Financial budgets are money measurements of operational or strategic plans.

3. Depending on the period covered
In this case budgets can be short or long term depending on the type of service provided and its magnitude. Budgets may be short-term or long term.

4. According to the flexibility
According to the client’s needs, rigid or fixed budgets can be developed in which the economic amount is fixed or it can be a flexible budget that adapts to the circumstances that arise at any time.

Apart from these types of budget there are many more depending on the type of company or the need of each client, for all this, the budget is a key instrument to develop your business, therefore a way to make it easy to develop them is through budgeting software or simulations. Microsoft Excel or budgeting software will help you make budgets easily and fun.

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