When it comes to purchasing an iPhone, especially the newest versions, you would want to think about finding the perfect iPhone insurance for your cell phone. When it comes to finding the right phone insurance you would want to think outside of the box. Your mobile phone carrier is not the only ones that will offer insurance policies for your iPhone.
Know What You Want
When it comes to finding the best insurance for your iPhone you would want to keep your needs in mind. When you are looking for an insurance company you would want to make sure that all of your needs are met and they offer the services that you will need to help protect your iPhone. When it comes to owning an iPhone it can become expensive but in the end when having an iPhone insurance policy you will feel better knowing that your mobile phone will always be covered.
Find an iPhone Insurance Plan That Fits Into Your Budget
When you are looking for the best iPhone insurance you would want to make sure that it will fit into your monthly budget. When it comes to purchasing an insurance plan you would want to make sure that you set some extra money to pay for the insurance plan. When trying to fit a policy into your budget you would want to make sure that the insurance policy that you are getting covers exactly what you want it too without having to break your budget.
Shop Around For the Best iPhone Insurance Policies
When it comes to finding the best iPhone insurance policy for you there is a way to compare some of the latest and most popular insurance policies for the iPhone. By comparing the different companies you would be able to tell which companies stick out from the rest. After you have narrowed down your list of choices you would want to compare the two different policies.
By comparing some of the different insurance policies you will be able to find the company that features all the different items that you are looking for. When comparing insurance companies and plans you will want to narrow down your choices and find the one that will fit your budget while meeting all of your needs.
When you are choosing your insurance policy you would want to make sure that they cover the version of the iPhone that you have. If you have an older version getting an insurance plan on that phone can be more difficult. Finding insurance for the latest iPhone would be a cinch but you might have to look around more to find the perfect iPhone insurance that will cover an older iPhone. When you are finding an insurance policy for an older iPhone you will find that often times it will cost more due to the fact that the version of the iPhone that you could have been outdated and is older.
When looking for the best iPhone insurance for you and your iPhone you would want to make sure that it has all the features that you need. You would want to make sure that it will fully cover your iPhone without going over your set budget. By following your instinct and doing some research you will find the perfect insurance policy for you.
Article Source: http://EzineArticles.com/7341998
Mobile Phone Insurance Comparison
When it comes to getting a more expensive phone, you would want to think about insuring it to go along. There are many times when people drop their phones on the floor, in water, and many other accidents can also happen with your phone. By looking at different insurance plans you can find the best one for you. When you are looking at different plans you would want to look at the comparison between the different types of insurances that you are looking at.
Benefits of Getting Insurance for Your Phone
When it comes to insurance for mobiles you will get many benefits from purchasing a plan. Most phone companies will give their customer protection from three months to a year depending on the company. They will offer these plans as an extra fee per month. These insurance plans will make sure that you always have a great working phone and the coverage. Another great benefit of getting insurances is that you can choose a company other than the company that you go through.
Finding a Great Insurance Company to Go Through
When you are looking for a mobile phone insurance company to go through you would want to think about using a comparing service to help you make some decisions when it comes to choosing the best insurance company. You do not want to let a comparison service make all the decisions for you but you would want to use this service to help you to make decisions on a few different insurances. Do your proper research on each company after performing the comparison to find the best insurance for your mobile phone.
Don't Overpay
When it comes to finding the perfect mobile phone insurance for your mobile phone you would want to find one that would fit inside of your budget. By looking through insurance comparison services will allow you to compare the prices of these different insurance companies and how much they charge their clients. These services can also help you to compare multiple insurance services and evaluate which one is the best.
When you are going through a insurance comparison service, you would want to look at popular companies and services that you have already heard about. By choosing a company that you have heard about you will be able to know that they will provide the best services to you. Asking your friends and family what services they go through will help you to determine the best services for you and your mobile phone.
When you are looking for a mobile phone service you would want to make sure that you go through all the different features and benefits that they will offer you as their client by using a this service. Researching different companies will allow you to find the perfect one that will take care of your needs if something happens to your mobile phone.
Article Source: http://EzineArticles.com/7342016
Benefits of Getting Insurance for Your Phone
When it comes to insurance for mobiles you will get many benefits from purchasing a plan. Most phone companies will give their customer protection from three months to a year depending on the company. They will offer these plans as an extra fee per month. These insurance plans will make sure that you always have a great working phone and the coverage. Another great benefit of getting insurances is that you can choose a company other than the company that you go through.
Finding a Great Insurance Company to Go Through
When you are looking for a mobile phone insurance company to go through you would want to think about using a comparing service to help you make some decisions when it comes to choosing the best insurance company. You do not want to let a comparison service make all the decisions for you but you would want to use this service to help you to make decisions on a few different insurances. Do your proper research on each company after performing the comparison to find the best insurance for your mobile phone.
Don't Overpay
When it comes to finding the perfect mobile phone insurance for your mobile phone you would want to find one that would fit inside of your budget. By looking through insurance comparison services will allow you to compare the prices of these different insurance companies and how much they charge their clients. These services can also help you to compare multiple insurance services and evaluate which one is the best.
When you are going through a insurance comparison service, you would want to look at popular companies and services that you have already heard about. By choosing a company that you have heard about you will be able to know that they will provide the best services to you. Asking your friends and family what services they go through will help you to determine the best services for you and your mobile phone.
When you are looking for a mobile phone service you would want to make sure that you go through all the different features and benefits that they will offer you as their client by using a this service. Researching different companies will allow you to find the perfect one that will take care of your needs if something happens to your mobile phone.
Article Source: http://EzineArticles.com/7342016
Reinsurance Overview
Reinsurance may sound like a foreign term to those unfamiliar with the reinsurance industry, but it's really just a way for insurance companies (insurer or ceding company) to spread the risk by transferring a portion of its financial obligations to another party (reinsurer).
While most consumers are familiar with "insurance," few are acquainted with the term "reinsurance." Insurance is a means by which the risk of a loss to an insurance company is spread over large numbers of insureds exposed to a loss. Reinsurance is the secondary market in the insurance industry-it is insurance for insurance companies and provides a mechanism to transfer the insurance risk from one insurer to another.
Insurance companies use reinsurance to provide protection against large individual losses or an accumulation of losses arising from one event and to provide protection against annual aggregate claim experience that may exceed actuarial projections. Basically, insurance companies want to protect themselves from unexpected loss development, so they buy "reinsurance." Further, insurance in the US is regulated at the state level. As such, insurance companies are permitted to issue policies up to a maximum percentage of their net worth. Once that maximum percentage has been reached, an insurer wanting to write additional business can increase its capacity to issue insurance policies by purchasing reinsurance.
Under a "reinsurance agreement," the ceding company and the reinsurer enter into a contract that stipulates the calculation and terms of payment for premiums due to the reinsurer and conditions upon which the reinsurer will be responsible for its share of claims. The terms of the contract are negotiated up front by the ceding company and the reinsurer, often with the assistance of an intermediary or broker. This broker earns a brokerage fee based on the premiums charged to the insurer and will assist in reporting and settlement of monies between both parties.
There are two general types of reinsurance agreements: Facultative Reinsurance and Treaty Reinsurance. Facultative Reinsurance agreements are designed to reinsure individual risks and are purchased on a per-policy basis. Facultative Reinsurance is typically used for large or unusual risks that an underwriter may want to specifically exclude from a Treaty Reinsurance agreement. Treaty Reinsurance agreements are designed to reinsure a group of policies that are specifically defined in the terms of the agreement.
Reinsurance plays an important role in the insurance industry, providing additional capacity to insurers and protection to insurers, which would otherwise not be available.
Article Source: http://EzineArticles.com/7334134
While most consumers are familiar with "insurance," few are acquainted with the term "reinsurance." Insurance is a means by which the risk of a loss to an insurance company is spread over large numbers of insureds exposed to a loss. Reinsurance is the secondary market in the insurance industry-it is insurance for insurance companies and provides a mechanism to transfer the insurance risk from one insurer to another.
Insurance companies use reinsurance to provide protection against large individual losses or an accumulation of losses arising from one event and to provide protection against annual aggregate claim experience that may exceed actuarial projections. Basically, insurance companies want to protect themselves from unexpected loss development, so they buy "reinsurance." Further, insurance in the US is regulated at the state level. As such, insurance companies are permitted to issue policies up to a maximum percentage of their net worth. Once that maximum percentage has been reached, an insurer wanting to write additional business can increase its capacity to issue insurance policies by purchasing reinsurance.
Under a "reinsurance agreement," the ceding company and the reinsurer enter into a contract that stipulates the calculation and terms of payment for premiums due to the reinsurer and conditions upon which the reinsurer will be responsible for its share of claims. The terms of the contract are negotiated up front by the ceding company and the reinsurer, often with the assistance of an intermediary or broker. This broker earns a brokerage fee based on the premiums charged to the insurer and will assist in reporting and settlement of monies between both parties.
There are two general types of reinsurance agreements: Facultative Reinsurance and Treaty Reinsurance. Facultative Reinsurance agreements are designed to reinsure individual risks and are purchased on a per-policy basis. Facultative Reinsurance is typically used for large or unusual risks that an underwriter may want to specifically exclude from a Treaty Reinsurance agreement. Treaty Reinsurance agreements are designed to reinsure a group of policies that are specifically defined in the terms of the agreement.
Reinsurance plays an important role in the insurance industry, providing additional capacity to insurers and protection to insurers, which would otherwise not be available.
Article Source: http://EzineArticles.com/7334134
How To Get Cheap But Good Quality Insurance
If you own a car, it is essential to buy some form of insurance. By getting insurance, you basically agree to pay a small fee to an insurance provider, in exchange for a guarantee from the insurer that they will take care of the expenses from a large, unintentional loss in the future. An insurance policy will pay for the price of repair for damages to your automobile and the other party's car.
In case of injuries, insurance will also take care of medical expenses or loss of income. Besides helping you avoid out-of-the-pocket expenses after an accident, some kinds of insurance are a legal requirement. While insurance regulations vary by state, most states require that motorists get liability insurance as a way of demonstrating financial responsibility. Just in case you got into a collision, and it is established that it was a result of your carelessness, you may get penalized and your driving privileges might get suspended if you fail to show proof of financial responsibility.
How can I get a good quote
Prices are different among insurers. Therefore, to obtain a good quote, you must compare prices thoroughly before getting a policy. Various factors impact the price of your vehicle insurance, and one of the most significant ones is the type of your car. For example, a sports car will have a higher insurance than a regular sedan. So if you would like to pay less for insurance, look at buying a car that insurers consider as less risky.
Where you reside is also another thing that impacts price. Case in point, insurance rates in urban locations are usually more substantial since more accidents occur there than in rural locations. Other factors that impact the price of vehicle insurance have to do with who you are. Insurance companies will take into account your age, sex, and driving record when you buy a policy. For instance, 19-year-old females tend to pay higher than much older females.
Go here to know how much is auto insurance for a 19 year old.
For adolescent drivers, there are several tips to keep insurance fees low. For one, you can obtain special discounts from doing well at school. You will also receive special discounts if you have enrolled in a defensive driving course. Having a spotless driving record will also make you eligible for discounts.
How to bargain insurance fees
Insurance policies are negotiable. Begin your negotiations by discussing the coverage you would like to have to your preferred insurance company and stating how much another insurer is offering for a comparable coverage. If they are unwilling to lower their rates to equal those of their rivals, think about transferring to an insurer that will cover you for a more affordable premium. Just the same just remember to resist the urge of sacrificing quality and good service just to get a more affordable premium.
Article Source: http://EzineArticles.com/7335534
In case of injuries, insurance will also take care of medical expenses or loss of income. Besides helping you avoid out-of-the-pocket expenses after an accident, some kinds of insurance are a legal requirement. While insurance regulations vary by state, most states require that motorists get liability insurance as a way of demonstrating financial responsibility. Just in case you got into a collision, and it is established that it was a result of your carelessness, you may get penalized and your driving privileges might get suspended if you fail to show proof of financial responsibility.
How can I get a good quote
Prices are different among insurers. Therefore, to obtain a good quote, you must compare prices thoroughly before getting a policy. Various factors impact the price of your vehicle insurance, and one of the most significant ones is the type of your car. For example, a sports car will have a higher insurance than a regular sedan. So if you would like to pay less for insurance, look at buying a car that insurers consider as less risky.
Where you reside is also another thing that impacts price. Case in point, insurance rates in urban locations are usually more substantial since more accidents occur there than in rural locations. Other factors that impact the price of vehicle insurance have to do with who you are. Insurance companies will take into account your age, sex, and driving record when you buy a policy. For instance, 19-year-old females tend to pay higher than much older females.
Go here to know how much is auto insurance for a 19 year old.
For adolescent drivers, there are several tips to keep insurance fees low. For one, you can obtain special discounts from doing well at school. You will also receive special discounts if you have enrolled in a defensive driving course. Having a spotless driving record will also make you eligible for discounts.
How to bargain insurance fees
Insurance policies are negotiable. Begin your negotiations by discussing the coverage you would like to have to your preferred insurance company and stating how much another insurer is offering for a comparable coverage. If they are unwilling to lower their rates to equal those of their rivals, think about transferring to an insurer that will cover you for a more affordable premium. Just the same just remember to resist the urge of sacrificing quality and good service just to get a more affordable premium.
Article Source: http://EzineArticles.com/7335534
Orang Bisa Tiba-tiba Berubah, Karena Allah Membolak-balikkan Hatinya
Starting Up a Small Business Concerns
In a previous article I dug a bit deeper into small business volatility but it is worth mentioning again especially in the context of getting a business started. Small business exists because large business has carved out a method to meeting the needs that doesn't reach everyone in a market place. In other words small business is small business because large business has deemed the pursuit of such market places not worth the effort. Large businesses seek opportunities that exist in well-established mature markets. These would be markets that yield smaller margins but are also less volatile. Consequently this leaves the more dynamic and volatile markets for the small businesses. This is part of why small businesses don't last long, they compete in an ever changing market place.
So, what does this mean for you? It means that the opportunities that will exist for you and the business you aspire to open will be opportunities that require quality and custom solutions quickly. This also means there will be a good deal of work involved in order to gain market share for you niche. Abandon any idea of providing a single product or service, you will need to diversify your products/service, customers, and possibly industries. To combat the ebb and flow of the small market place you will need diversify all aspects of your company.
Alignment
Ok, now that you understand a little about the realities of the small business market place the next thing to look into is how well your potential business aligns with who you are. In the beginning stages of a business the founder is the business and the business is the founder. To offer the most value the business should be the embodiment of you and you should be the embodiment of the business. The realization of a single opportunity should not be the only deciding metric for starting a business. As an example; A few years ago I had the opportunity to start a frozen yogurt shop in my town that would have been modeled after a profitable model that was doing well in other cities. I did my homework and found that for $40,000.00 I could have everything I needed to open the doors and start selling yogurt. I decided against it for two reasons, 1. I live in a four season's area and I did not want to have a feast or famine demand and 2. I am not that crazy about yogurt. Now, the opportunity was there, and since then many of these shops have opened, but I didn't want to invest 80 hours a week into a frozen yogurt business.
Market Positioning
So you have an idea that aligns with who you are, and you have come to understand the nature of the small business market place, how are you going to position your product or service? How are you going to meet the needs of the customer? The answer is somewhat laid out above, but because of the nature of the small business market place you will need to become a high quality, quick turnaround company. Small businesses have the advantage in small volume custom areas. Your competitive advantage will be your ability to cater to the specific needs of your customer. As a small business you have no business competing on price.
Margin
You are your business, and chances are you do not have much capital behind you. This means that achieving a positive cash flow situation as quickly as possible is key. Cash is king and without it you don't have a business. The upside is small volume high quality work demands top dollar. That's right, by being a small business you are competing in a large margin arena. The mark up on your products and services can and should be high. The market will let you know when you are too far out of range, but a healthy profit margin is to be expected with small businesses. Individuals that fail to understand this begin to lower their prices in hopes of gaining some sales but what they don't realize is they are diluting the market and putting themselves out of business. So, don't be afraid to charge for your work!
Growth Strategy
The last thing I will mention for those looking to start a small business is that a growth strategy is imperative. You need to have an idea of where you are going if you ever expect to make it as a business owner. By nature small businesses should only remain small for a while, if you company is not growing it is dying. Markets mature, customer needs mature, and guess what... your business should also be maturing. Knowing where your business is headed will allow you to take the appropriate measures today to set up for tomorrow's market. A growth strategy can be vague. You don't need to define every variable, but you should use your intuition to determine where you should position your company.
If you are planning on starting a small business understand it is a lot of hard work and there are no rules. There is no one telling you what to and not to do, you will be responsible for your success or your failure. You must be persistent and willing to invest more of yourself than the next guy in line. If it were easy everyone would do it, but because it is demanding there are only a few to compete with.
Article Source: http://EzineArticles.com/6410915
Ingat, Tetap Jadilah Orang Baik Meski Kamu Sering Diperlakukan Buruk Oleh Orang Lain
Tips for Growing Your Small Business
Consumers have so many choices when it comes to choosing the right business for their needs. The first decision they must make is whether to go with a small or big business. Small businesses are able to focus on their mission and keep their fingers on the pulse of their customers. They are also able to offer more personal attention to their clients. But we have seen a dramatic decline in the number of small privately owned businesses these past few years.
For smaller businesses today, an important point to consider is whether they should develop an online store or website. Many experts agree that an online presence is essential for most businesses, and that there are several reasons why consumers should select a small business over a big one.
While many small companies see big companies as the enemy, their real competition is other small companies like themselves. Most big businesses already have a recognizable brand name. They also have a pretty loyal fan base. They are not worried about small operations knocking them down in sales. But other small shops must continue to fight their business counterparts to get an edge in today's market.
Why would people choose to go with a smaller business over a larger one? Many customers enjoy the more personal and face-to-face attention they get from a small business; they're not just talking to a voice on the end of a phone. Some people like to think that the money they're spending is going back into the local community. You need to remember these principles when developing your website or online store.
It is increasingly straightforward for a small to medium business to establish an online presence nowadays. Successful online stores can really help small businesses increase their sales and steer their profits into the black. Before launching an online store, however, a small business first needs to learn how to make the most of its strengths.
Some small sized businesses make the mistake of using their online image as a way to appear bigger. But that image may turn away the customers they would normally attract with their usual image. Building an online image that reflects the hallmarks of a small business is important. Having an email address and phone number on your website for customers to contact you is a good way help them feel more personally connected to your business. Also consider an instant chat option with customer service representatives for your customers to receive real-time responses.
Also highlight how your small business benefits the local economy. Use your website to remind customers that you are a member of the community and that you care about it. Maybe highlight the employees to give them the "face" your customers want to see. That added personal touch is what brings in the types of people who are tired of big businesses and want better customer service.
Too many small businesses try to go bigger and better when they establish their online store or website. They lose sight of their original mission and forget about the things that people value about small business. Make sure you make good use of your business's characteristics when establishing your online presence and don't discard your small business image. This will help your venture online be a success.
Article Source: http://EzineArticles.com/6747065
Jangan Hanya Karena Ingin Menolong Sang Janda, Kamu Rela Menjandakan Istri Sendiri
The Point of Budgeting In Small Business
Too many small businesses operate without budgets. And many small businesses that do have budgets aren't getting as much out of them as they could. We've seen it time and again.
It isn't because the mechanics are difficult to manage. Everyone knows the basics of how budgets work: you track money coming in, you track money going out, and you do your best to plan for the future. In fact, the very simplicity of that formula is what leads some small-business owners to consider budgets not worth the trouble.
Therefore, what we'll discuss here isn't what budgeting entails, because if you don't already know that, you can find it out with ease. We're more interested in why you should budget in the first place. Our suggestion, to put it plainly, is that budgeting is a way to amplify the very creativity and adaptability that allow small businesses to thrive.
Budgets' Reputation
You don't become an entrepreneur because you have a burning love of spreadsheets. At least, not usually. Being an entrepreneur isn't supposed to be about budgeting. It isn't supposed to be about paging through endless columns of variable costs or putting caps on spending. It's supposed to be about having the freedom to blend innovation and risk-taking with passion and expertise. It's supposed to be about removing barriers, not building them.
That being the case, small-business owners often see budgets as antithetical to the very spirit of entrepreneurship. According to this perspective, budgets impose stifling limitations. They're artifacts of mega-corporate culture devised by clammy-handed people in windowless rooms with poor lighting. They may be necessary evils for sprawling, inhuman conglomerates, but when it comes to organizations that rely on individual personalities and individual decision-making, budgets are more burdensome than helpful.
You might say the constraints imposed by budgeting make small businesses less nimble. Since nimbleness is one of their main advantages over larger rivals, budgets actually decrease small businesses' ability to compete.
Or so the story goes.
Some of it is accurate. For instance, it's true that passion and innovation go hand in hand with entrepreneurship. It's true that small businesses should strive to leverage their size into a competitive advantage. And it's true that budgeting for small businesses is much different from budgeting for colossal corporations.
What's not true is that budgets impose constraints. Budgets don't actually impose anything. They merely describe constraints that are already present. Perhaps more importantly, they describe a business's ability to cope with and even manipulate constraints placed on it by forces internal and external.
Constraints and Entrepreneurial Creativity
If you're an entrepreneur, you're aware that your business doesn't operate in a vacuum. It's part of a staggeringly complex system. For instance, you have your relatively immediate concerns, such as your employees and your local government. You also have your relatively big-picture concerns, such as national debt and foreign trade policy. No matter what, when you start a small business you're going to be hemmed in by laws, regulations, and unavoidable economic realities, all of which will have a major impact on how you operate.
In other words, no small business starts out in a position of unfettered freedom. The very conditions that allow small businesses to exist also impose a variety of constraints. Working capital, interest rates, the minimum wage, the minimum competitive salary for professional employees-there are countless factors that limit what you can do and how much money it takes to do it.
You can acknowledge the reality of these factors, but if you don't have a budget, then you might not know the exact ways they're affecting you. What particular constraints does a business in your industry have to deal with? Are there some that have a disproportionate impact on you because of the way your business functions? Can you make changes to reduce their impact? Are there constraints that you handle in an especially productive way? Can you turn this productivity into an advantage over your competitors? Do you approach some constraints the way everyone else does, even though you could be doing a better job with them?
These are the sort of questions a budget helps you answer. It doesn't create limitations that weren't there before. Rather, it gives you a way to assess the pre-existing limitations that every small business in your industry has to deal with. The more thorough your assessment of those limitations, the greater your ability to work within them, work around them, or in some cases, make them work for you.
Making limitations work for you is where entrepreneurial creativity comes into play. If you have enough details on your business's limitations, then you'll be better able to turn those limitations into innovations. A budget will help you marshal your creative energies and find the opportunities for profit embedded in the market's constraints. It tells you exactly what assets you have to work with, and helps you map out how those assets can be put to the most productive use given the rules of the industry.
After all, most of the market-based constraints you experience will be shared by your competitors, who also have limited amounts of money and freedom. Which of you comes out on top won't be determined by who has the fewest constraints, but by who does the best job of manipulating common constraints to find the possibilities they hide.
Speed, Spontaneity, and Profit
Small businesses, precisely because they're small, tend to be better than their larger competitors at taking quick, decisive action. It's one of their vital advantages. By the same token, it's one of the challenges that all entrepreneurs are bound to face. You'll be forced to react on a moment's notice to emerging opportunities or perils in the market-that's a given.
What's less certain is the profitability of your reactions. Obviously, acting or adapting fast doesn't do much good if it yields a loss.
So what information will you use to make your quick decisions? Do you have a detailed, practical breakdown of your business's strengths and weaknesses? Do you know exactly how many resources you can afford to redeploy at a moment's notice? Do you know how efficiently different aspects of your business tend to use the resources you devote to them? Are certain aspects of your business already strained? Are certain aspects flush with the potential for expansion?
A budget gives you a diagnostic readout of your organization. It tells you how much stress the business can handle and which areas can handle it. Hence, it helps you decide whether acting conservatively or aggressively in the short term will enhance your performance over the long term. Without a budget, you'll be relying too much on guesswork, and many of your quick decisions may be needlessly risky.
Supply-chain Relationships
A budget not only helps you assess yourself, but also helps you assess your relationships with other entities, like vendors and subcontractors. This will be especially important when the market is in flux.
As you know, successful entrepreneurship entails evaluating the vast array of forces that constitutes the market and determining where-for someone in your industry, someone with your passion and expertise-the opportunities and roadblocks lie. But no one can predict with any certainty how the market will behave tomorrow. There will be surprises. Sudden chances and sudden setbacks.
We've already noted that the way you respond to these inevitable surprises will play a critical role in the profitability-or survival-of your business, and that your ability to make the right call at the right time will be drastically greater if you have a budget in place. This is not only because a budget tells you about your own resources, but also because a budget helps you deal with other organizations that affect you.
Let's say you experience a sharp increase in demand for your product. It's good news, but it brings up questions: Do you have enough working capital to provide your product to a large number of new customers/clients? What are the current resources of each division of your business? How many more resources does each division need if it's going to ramp up its activities? How efficiently does each division tend to use its resources?
These are all internal questions that may well lead to others, such as: What do your vendor accounts look like? How much new inventory can you afford to purchase? What type of sales will you need if you're going to pay off the new purchases on time? Can you afford to hire subcontractors to help with the push?
And, of equal or greater importance: What's your plan for a downturn in demand? Will you find yourself in a precarious position with your vendors? Will you be able to keep promises to new customers? Will you be able to pay your subcontractors for the hours they've put in?
Indeed, budgeting can provide invaluable support for all your relationships. As noted on Inc.com, "your suppliers are in all likelihood mapping out their expectations for the year and you can help them do so by providing your outlook. As a best practice, you should share your budget and the variety of scenarios you might face to see whether they can handle each level of demand" (Field 2010).
Since your business is one element in a network of other businesses, it's important for you to be able to communicate both your capacities and your expectations to the people you rely on. A budget serves as a tool for facilitating such communication. It gives you a concrete way of describing not only where you stand, but also where you will stand in a given scenario. Thus, it helps foster strong partnerships and avoid uncomfortable conversations.
This doesn't mean sharing every detail of your budget, nor does it mean sharing some details with everyone. It simply means that guarding your budget like a state secret takes away some of its efficacy. You can use select portions of your budget to assist you in negotiating with critical partners-i.e., you can be prudent about the information you divulge without being obscure. How much do your current business partners know about your budget? Is it enough for them to understand your capacities and your needs?
The Bank
Speaking of business relationships: you don't want to mess around with the bank. Plain and simple. This is a relationship that should be as friendly and open as possible. And what do bankers like? Budgets. As the American Bankers Association (ABA) says, "You are flying in the dark financially if you don't have a budget for all income and expenses."
Come to them without a budget, and bankers are going to feel like you're wasting their time. They're certainly not going to be interested in loaning you money (or more money). "Prepare for your financial review with your banker," says ABA. "Have current inventories, cash flows and balance sheets ready."
When your banker asks you how your debt is structured, and whether you have an imbalance between long- and short-term debt, what are you going answer? Trust us: if you show up to that meeting with a budget, you'll be glad you did.
Flexibility
Just as the market's unpredictability makes budgets useful, it also makes them fallible. A budget is like any plan: it will contain inaccurate predictions and require ongoing revision. That's simply a condition of commerce; some academic models are predicated on entrepreneurs having perfect foresight, but we all know that's not the case. Businesspeople, even the world's most celebrated financial prognosticators, get it wrong sometimes.
That doesn't render planning completely useless. Even if your plans don't entirely match the way reality unfolds, they serve as benchmarks against which you can assess your progress. They record where you wanted to go, where you actually went, and why the two didn't coincide. In that way, they indicate which areas of your business are performing well, and which need to be modified in order to meet next quarter's goals.
When it comes to small-business planning, certainty is off the table. Nothing is guaranteed, including budgets. But setting expectations and monitoring progress remain indispensable to long-term survival. They help small-business owners analyze why they're drifting off course, and also help them formulate corrective measures.
How do you see a budget? As a static report that turns old news into flimsy predictions? Or as a series of living documents that records how you adapt to change?
Personnel
Thorough budgeting calls for a great deal of effort, and many small-business owners can't spare the necessary time or energy. Frankly, while the minutiae of budgeting are of interest to the entrepreneur, they are not the entrepreneur's main job. If they were, then a good head for numbers and a background in financial analysis would be prerequisites for entrepreneurship. Yet plenty of small-business owners have succeeded without an affinity for mathematics or statistics. Entrepreneurs don't all begin as certified public accountants.
That being the case, most small-business owners hire a bookkeeper. A bookkeeper collects and organizes your financial information, which, again, is time-consuming and requires close attention to detail. Too much time and too much attention for small-business owners to sacrifice. But even if you're not involved with gathering and sorting your financial information, you needn't remain aloof from it. To get the most benefit from budgeting, you'll want to be accustomed to reading your financial statements and locating important data in your financial system. When you meet with your bookkeeper, are you talking about his or her methods? Is he or she showing you how your financial information is organized? Are you able to navigate your bookkeeping software on your own, so as to pull up specific pieces of data without your bookkeeper's assistance?
Proper bookkeeping is important, but it rarely goes far enough in the analysis department. You'll notice that the bulk of our discussion has revolved around using budgets to orient yourself in the market-i.e., using them to take advantage of opportunities and to minimize risks. That requires more than tabulating numbers; it requires interpreting them. It requires fitting your numbers into a larger picture.
Is there anyone in your organization besides you who (1) monitors your finances on the close-in, detailed level, and (2) relates the details of your finances to your big-picture performance? If not, chances are you'd benefit from a dedicated financial person. Someone whose duties involve painting a comprehensive picture of your financial universe-more comprehensive, that is, than the picture you're able to paint on your own, simply because you have other things to do.
As with most aspects of running a small business, getting the most out of budgeting requires skillful delegation. If a budget is going to inform your decisions at major turning points, then it's a good idea to have someone to consult with, someone who's been looking at the same numbers as you while also looking at the same problems.
Takeaway
The value of a budget doesn't rest on the accuracy of its predictions or the stringency of its cost-cutting. Instead, the value of a budget rests on how well it articulates your business's financial strengths and weaknesses. A budget exists to help you balance risk against opportunity, to help you determine whether aggressive or conservative action is the right thing for the moment. It also exists to help you communicate with your business partners-to, in other words, cultivate healthy, mutually beneficial relationships with the organizations you rely on.
Above all, a budget exists to de-mystify, or express in concrete terms, the limitations imposed on your business by the market. Thorough budgeting, especially when undertaken with the right personnel, can enhance your creative initiatives and merge adaptability with profit. In short, budgeting is a way to sharpen, not blunt, a small business's advantages.
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