Vinu: Manu, every year I set targets, but things don’t go as planned. Where am I going wrong?

Manu: You’re planning, but not budgeting with control. A target is a goal—budget is execution discipline.

Vinu: What exactly should a business budget include?

Manu: Three parts—Sales, Expenses, and Cash Flow.

For example,

Planned sales ₹25 lakh/month,

Manu: By comparing budget vs actual every month.

If actual sales are ₹22 lakh but expenses are ₹21 lakh, your expected ₹5 lakh profit drops to ₹1 lakh.

Manu: Exactly. Identify gaps early.

If marketing budget was ₹2 lakh but you spent ₹3.50 lakh, that ₹1.50 lakh overspend needs justification.

Vinu: What about cash?

Manu: Budget cash separately.

Even if profit is ₹5 lakh, your cash outflow may be ₹7 lakh due to EMI ₹2 lakh—creating a gap.

Vinu: How detailed should my budget be?

Manu: Not too complex. Focus on major heads—sales, key costs, and fixed expenses like salaries ₹4 lakh, rent ₹60,000.

Vinu: What’s the biggest mistake entrepreneurs make?

Manu: Preparing a budget once a year and never reviewing it.

Manu: Monthly minimum. Weekly if your business is fast-moving.

Vinu: One practical tip to stay in control?

Manu: Fix spending limits in advance.

If your monthly expense budget is ₹20 lakh, crossing it should trigger immediate review.

Vinu: Final takeaway?

Manu: Budgeting is not about prediction—it’s about controlling your business before costs and cash go out of hand.

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