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Business Btec: Unit 2

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Submitted By gurjeavenbasi96
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Bilborough College
College Way
Nottingham
NG8 4DQ
Riverside Café
Canal Street
Nottingham
NG2 1CB

17th November 2014

Dear Adam and Josh,
Having looked at the predicted and actual budgets for the business, I am going to give you some advice on how to manage your money more effectively which could start to help you and the business make a profit again.
It is very important that you look after your cost and your budgets because you will be able to manage your finances; if you manage your costs you will be able to save more on your expenses which can then lead to increasing your revenue, for example if you controlled your costs you will be able to save money and then by having the correct amount of stock which can then be sold for money which will then bring extra money in so that you can spend that money on improving your business. If you didn’t look after your costs the amount that you spent on your expenses could impact on the amount of profit that you make. If you control your budget then you will be able to increase you income, you’ll be making sure that you have working capital and you will be able to set aside extra money when it is needed. You are over spending on the following things: stock, wages, administration, insurance, interest and loans, bank charges and repairs and maintenance. There are ways that you can adopt to make sure that the overspending stops. You could hire an accountant to help you structure you budgets, you could do research on what customers are demanding and the popular products that you do, you could look at your previous records and see where you went wrong and you also could look at your previous sales turnover, these are all suggestible ways that you might be able to stop overspending. On your budgets you have adverse variances and favourable variances. An adverse variance is when you have done worse than expected; this

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