The budgeting process in a small business runs in two directions and meets in the middle: strategic budgeting sets the year's figure from the top, revenue less the margin the owner needs, and a bottom up budget builds it from the lines each department will actually spend on. The reconciliation between the two is the process, and it is where budget software business owners buy and budgeting software business teams keep earn their price: every line with its holder, its annual figure and the actuals that will land against it. This page is the process as figures, and the free departmental roll-up sheet on this site works the month-end reconciliation from the business's own numbers with no account.
The strategic figure
Revenue expected, less the margin the business needs, is what the departments may spend between them; strategic budgeting is that one line, and it is the ceiling the bottom up budget has to fit under. A business that skips it budgets what it spent last year plus a percentage.
The bottom up budget
Each department lists its lines with the figure it needs and the holder who owns it; the sum is the ask. The ask against the ceiling is the reconciliation, and it is a conversation about lines, not a percentage cut. The roll-up sheet on this site works the lines' sum and, once the year runs, the variance against it: $10,000 over at month six on the worked example.
What budgeting software business owners buy has to keep
Lines with holders and annual figures, commitments and actuals against them, the roll-up by department and total, and an export. Budgeting software business teams keep is judged by whether the month-end variance is a lookup; Opexvo Pro keeps that record at one flat price, and the sheets work the figures free.
Questions people ask about strategic budgeting
What is the budgeting process for a small business?
A strategic figure from the top, a bottom up budget from the lines, and the reconciliation between them; then the month-end variance against the result.
What is a bottom up budget?
Each department's lines with a figure and a holder, summed into the ask; the free roll-up sheet works its sum and its variance.
What should budget software for a business keep?
Lines, holders, commitments, actuals and the roll-up, exportable; the variance as a lookup.