1.1 Explain The Importance Of Agreeing To A Budget And Operating In A Business Case Study
AC 1.1
Explain the importance of agreeing to a budget and operating within it:
Budgets within a business are used to control expenditure, and maximise profit. Managing budgets is a vital skill within my role, and how I am able to stay on target plays a huge part in my performance reviews. We communicate our trading results on a weekly and monthly basis with our Head of Operations and our Business Director. We need to have an explanation for any variances and have an action ready to remedy the solution. Sticking to a budget is not just in one area of the business, it is incorporated in each and every unit that we operate in, to each separate cost centre and GL code, from labour, to medical expenses to waste bags to ink cartridges. In Compass …show more content…
This allows for more effective cost control.EG, Compass would use this system only in very extreme cases, where we might get a call from customer asking us to come in and take over a contract and we need to have it done in one month. We then would benchmark the site against maybe something similar that we have now or previous to forecast cost of labour, food supplies, machinery and stationery. We would then have finance keep check on the costs and send us reports of the spend and what the contract was actually costing us. We would take the variances and see where we can apply any changes within the business that could bring the costs down. All aspects would be looked at, and the changes or cost cutting measures would be applied in line with the actual costs. Therefore controlling the costs. But this only works if you have a good reporting and analysis system in …show more content…
Take advantage of the weekly deals that procurement get for the units from suppliers as one offs. Review weekly trackers coming from the units and validate with SAP that the costs they are submitting are correct. Monthly pull one manager’s payroll and go back to the end of the previous month and match off with singing in sheet or Bioscan – whichever method is in use on the unit for any discrepancies. Regularly review costs against budget including the overheads to ensure we are on target. Map our journeys. Each unit is subject to an audit from our profit protection risk management team, they will review all purchases, check all labour, review stock holdings and we must receive an 86% mark to
Explain the importance of agreeing to a budget and operating within it:
Budgets within a business are used to control expenditure, and maximise profit. Managing budgets is a vital skill within my role, and how I am able to stay on target plays a huge part in my performance reviews. We communicate our trading results on a weekly and monthly basis with our Head of Operations and our Business Director. We need to have an explanation for any variances and have an action ready to remedy the solution. Sticking to a budget is not just in one area of the business, it is incorporated in each and every unit that we operate in, to each separate cost centre and GL code, from labour, to medical expenses to waste bags to ink cartridges. In Compass …show more content…
This allows for more effective cost control.EG, Compass would use this system only in very extreme cases, where we might get a call from customer asking us to come in and take over a contract and we need to have it done in one month. We then would benchmark the site against maybe something similar that we have now or previous to forecast cost of labour, food supplies, machinery and stationery. We would then have finance keep check on the costs and send us reports of the spend and what the contract was actually costing us. We would take the variances and see where we can apply any changes within the business that could bring the costs down. All aspects would be looked at, and the changes or cost cutting measures would be applied in line with the actual costs. Therefore controlling the costs. But this only works if you have a good reporting and analysis system in …show more content…
Take advantage of the weekly deals that procurement get for the units from suppliers as one offs. Review weekly trackers coming from the units and validate with SAP that the costs they are submitting are correct. Monthly pull one manager’s payroll and go back to the end of the previous month and match off with singing in sheet or Bioscan – whichever method is in use on the unit for any discrepancies. Regularly review costs against budget including the overheads to ensure we are on target. Map our journeys. Each unit is subject to an audit from our profit protection risk management team, they will review all purchases, check all labour, review stock holdings and we must receive an 86% mark to