Budgets and Financial Forecasts
Turn your business plans into meaningful financial targets
Knowing what you want your business to achieve is important. A budget or financial forecast helps you understand what those plans look like in numbers – and what needs to happen financially to make them possible.
At ilumin, we help you translate your goals and plans into realistic financial targets, giving you a clearer picture of expected income, costs and profitability. Rather than simply looking back at what your business has already done, you can use your budget and forecasts to look ahead, measure your progress and understand the potential financial impact of the decisions you’re considering.
The result is greater visibility over where your business is heading financially and more useful information to support the decisions you make along the way.
Setting financial targets
Your business goals become more useful when you can measure progress towards them.
We’ll help you put realistic numbers around what you want to achieve, giving you financial targets to work towards and a clearer understanding of what success needs to look like.
Forecasting income and costs
Understanding what you expect to earn is only part of the picture.
Financial forecasting helps you consider the costs involved in delivering your plans, giving you a more realistic view of expected financial performance.
Planning for growth
Growth often requires investment before you see the financial return.
Forecasting can help you understand what your growth plans could mean financially and identify the resources or changes that may be needed to support them.
Understanding profitability
A budget gives you a framework for understanding the level of income and costs required to achieve your profitability goals.
That can help you identify where performance may need to improve and where your attention could make the greatest difference.
Measuring actual performance
A budget becomes more valuable when you use it throughout the year.
Comparing your actual results with what you expected can help you see where the business is performing differently from your plan and understand why.
Supporting business decisions
Hiring someone, investing in equipment, changing prices or pursuing a new opportunity can all have financial implications.
Forecasting gives you a way to explore those implications before making the decision.
Who are budgets and financial forecasts for?
Budgets and forecasts can be useful for any business owner who wants greater visibility over what lies ahead rather than relying solely on historical financial information.
It can be particularly valuable if you:
Want clear financial targets to work towards and measure performance against.
Are preparing for growth and want to understand what your plans could mean financially.
Are making decisions about hiring, pricing or investment and want to understand the potential impact.
Want to improve profitability and need a clearer picture of income and costs.
Are a woman founder or business owner wanting greater financial confidence when making decisions.
Are preparing for a significant change and want to understand different possible outcomes.
Are applying for finance and need financial forecasts to support your plans.
What you will walk away with
The aim is to give you useful financial information that helps you look ahead and make decisions, rather than simply another set of numbers.
You’ll gain:
Clearer financial targets
Giving you something meaningful to work towards.
Greater visibility over expected performance
Including income, costs and profitability.
A financial view of your business plans
Helping you understand what may be required to achieve them.
A basis for measuring progress
By comparing actual performance with what you expected.
More confidence making decisions
With a clearer understanding of their potential financial implications.
Common budgeting and forecasting questions
Don’t see your question here? Feel free to get in touch.
When to create a budget or financial forecast
The beginning of a financial year can be a natural time to establish your targets for the year ahead, but you don’t need to wait for a particular date.
A budget or forecast can be particularly useful when your business is changing. Whether you’re preparing for growth, employing people, making a significant investment or considering a new direction.
And it shouldn’t necessarily be something you create once and forget about. As circumstances change, reviewing your assumptions and actual performance can help keep your financial plans relevant.
How does budgeting and forecasting work?
We start with your business goals and what you’re planning for the period ahead. From there, we’ll work with your financial information and assumptions to put numbers around those plans and create meaningful targets and forecasts for your business.
The real value comes from using that information. Your forecast gives you a financial reference point for reviewing performance, asking better questions and making adjustments when circumstances change.
With cash, timing is particularly important. Cashflow Management can complement your financial forecasts by giving you greater visibility over when money is expected to move into and out of your business.
What's the difference between a budget and a forecast?
A budget generally establishes the financial targets you’re aiming for, while a forecast uses current information and assumptions to estimate what is likely to happen. Both can help you understand and plan for future financial performance.
Do I need a budget if my business is profitable?
A budget isn’t only about fixing poor performance. It can help a profitable business set targets, plan growth and understand whether current performance is enough to achieve its wider goals.
Can you help me understand whether I can afford to hire or invest?
Financial forecasting can help you explore the potential impact of a significant decision before you commit to it.
Should my budget change during the year?
Your original budget provides a useful benchmark. Forecasts can be updated as circumstances and expectations change. This can help you distinguish between what you originally planned and what you now expect to happen.
Plan ahead with greater financial clarity
Putting numbers around your plans can help you understand what’s achievable, what needs your attention and what needs to happen next.