Every body knows that the business success depend on the profit that they able to achieve. But it is also known that in order to make profit from the business you will need to spend money as cost to pay the business operations. Therefore the decision maker must establish a proper budget plan to finance the business operation.
Cost management
To make sure that the business is getting the highest profit from their operation, they must applied proper financial management. Business cost management is very crucial for any types of business. It is unacceptable to spend huge amount of budget on expensive equipments and operations if the result can be achieve effectively using simpler and cheaper equipments and operations. The tally between the amount of cost or budget with the business profits (profit margin) will indicate the success of the business.
Board treasurer
The first line in cost management is the board treasurer. They will maintain the clear bookkeeping information about your financial statements and record every cent that entering and going from the business account. They will control the cost that need to be paid according the business plan. Using the financial information, the business decision maker will be able to decide the clear business plan according to the budget.
Besides controlling the expense, every members of the business organization must also committed to carry out the business plan without unauthorized adjustment or changes. Therefore the business operation cost will not increase or exceeds the budget. The unplanned expenses will only burdening the business budget and reduce the profit. But the decision maker should also consider about the unexpected cost that may appear or occur during the business operation and include it when planning the budget.