Empower Your Cleaning Service With What If Spreadsheet Template
When running a commercial cleaning business, decision-making is a critical aspect of ensuring its success. One of the most important decisions is managing the company’s finances, which includes creating a spreadsheet template for your budget.
A spreadsheet helps the business owners determine how much money they have and where it is going. It allows us to make informed decisions regarding spending and resource allocation.
To create a budget spreadsheet, business owners must consider the various expenses that come with running a cleaning company. These expenses may include salaries, supplies, equipment, rent, and utilities.
Additionally, owners must also consider the various “what-if” scenarios that can occur when running a business. These scenarios may include hiring an office manager, purchasing new equipment, expanding the business, or even buying out a competing company.
The first step in creating a spreadsheet is to list all current expenses. This should include all the necessary costs associated with running the business.
Owners should also be sure to include any recurring expenses, such as monthly rent, marketing expenses or utility bills. By listing all current expenses, owners can determine how much money is being spent and where it is going.
Key here is separating fixed costs from costs of goods sold. Fixed costs you have to pay no matter what like rent, insurance, debt payments, etc.
Cost of goods sold are specifically related to the job: labor, materials, etc.
The next step is to list all potential “what-if” scenarios. This is where owners must use their imagination and consider all the possibilities. These scenarios may include hiring additional staff, purchasing new equipment, or expanding the business.
By listing all potential scenarios, owners can determine how much money they will need to invest in their business to make these scenarios a reality.
Once owners have listed all current expenses and potential “what-if” scenarios, they can begin to create a budget.
This is done by comparing the expenses to the company’s current revenue. Owners should be sure to take into account any additional revenue that may come in from the “what-if” scenarios they have listed.
Example What If Spreadsheet Scenario
To illustrate the process, let’s use an example. A cleaning business currently spends $14,000 a month on expenses and has a profit margin of 27%.
The owners are considering hiring a part-time employee to help with advertising , which will cost an additional $5,000 per month. To determine whether this expense is feasible, owners must consider the impact it will have on their profit margin.
To do this, owners can use a budget template like the one mentioned in the video transcript.
The template includes two columns: one for current expenses and one for potential expenses. By listing all expenses, owners can determine the company’s current profit margin. They can then add the potential expense to the list and calculate the new profit margin.
Using the example above, the company’s current expenses are $14,000 a month, resulting in a profit margin of 27%. If the owners add the $5,000 expense for a part-time employee, their new expenses will be $19,000 per month. This results in a new profit margin of 22%. In order to return to the original profit margin of 27%, the company would need to generate an additional $15,000 per month in revenue.
This process illustrates the importance of budgeting and the need to consider “what-if” scenarios when making financial decisions. By creating a budget, business owners can determine the feasibility of potential expenses and make informed decisions regarding resource allocation.
In addition to using a budget template, business owners may also consider hiring a financial advisor or accountant to help with budgeting. These professionals have the expertise and experience necessary to help business owners create a budget that is tailored to their specific needs.
In conclusion, creating a spreadsheet to budget is a critical aspect of running a successful commercial cleaning business. By listing all current expenses and potential “what-if” scenarios, owners can determine how much money they need to invest in their business to make it profitable. This process requires careful consideration and analysis but is essential for making informed financial decisions. By using a