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2026 Business Plan and Budget
"2026 Business Plan and Budget"
November 2025
Richard T. Hendee
A Silver Fox Advisor
Last month, I addressed the reasons and elements of a Business Plan. This month I will do the same for the Business Budget.
I will start by saying the same thing I did last month about the Business Plan and that is --- “If you have been in business for a while, you are probably saying, “Why do I need a 2026 Business Plan and Budget”?
And my response last month was - “Your business is probably the largest single asset you have. It is also the source of your family’s livelihood”. Don’t you want your business to be successful and generate profitability to support your family? If you said yes to these questions, then let’s do something about it to make that happen!
Doing an annual budget and measuring the results monthly is your financial barometer of the success of your business. I do not know of any business owner who is in business to lose money. If you don’t have a budget and measure the actual results, how will you know if you are making money or losing money? I have had some business owners tell me, “If I have money in my checking account, I am making money”. Well, if you have money in your checking account, that means you have cash today, and that’s good, but what about tomorrow and the day after that and so on?
Doing a budget can be overwhelming, but it doesn’t have to be. Some business owners like to start by taking the previous year’s numbers and simply adding some amount or percentage increase to each line item.
I always start with looking at expenses. First, I take all the expenses I know will be the same each month like rent, phone, cleaning etc. Then I look at expenses I know will vary, like utilities which likely will be more at certain times of the year, e.g. electricity in the summer months will be more because the air conditioner is running more then. If there are loan payments, I look at what the interest payments will be each month and include that amount (principal loan payments are not an expense item. Principal payments come out of profits). Payroll expenses can be the same each month if you have all salaried employees. Hourly and part-time employee costs will vary and may be seasonal.
Once you have expenses calculated, then move to the revenues side of the profit and loss statement. Start by looking at what revenues need to be each month to cover all the expenses you calculated. Then, look at what the revenues were each month the prior year and see if you need a big increase in revenues to cover the expenses. If you don’t anticipate big revenue increases happening. then you probably need to look at what expenses can be reduced to cover those expenses. Also, don’t forget about how much in the way of profits do you want to generate. Add that amount in to then see where revenues need to be to cover the expenses and generate the profitability you want to achieve. This all may sound complicated, but once you get involved in the process, it is really not.
Now that the budget is built, each month you should measure the actual results to the budgeted numbers and determine if you are on track or need to make some adjustments. Additionally, this monthly assessment can be very helpful if say half way through the year you have an unexpected expense that you need to cover, and you want determine if you can afford that need. Simply look at the expense categories that you are under budget on, and you may discover you can afford that unexpected expense and still be on budget overall. At the very least you will be making more educated decisions instead going on a hope and prayer, although in some cases the prayers may be of great help also!
If you need assistance in working through your “”2026 Business Budget”, I recommend you start by contacting the Silver Fox Advisors. Silver Fox Advisors are former or present business owners themselves, and they have experience in running a business, and in some cases several businesses, and they have lots of experience developing Business Budgets. We encourage you to visit our website at www.silverfox.org to select a Silver Fox Advisor and also to learn more about the Silver Fox Advisors, as well as our great programs and community outreach endeavors.
November Leadership Training/Mentoring Situation
THE LEADERSHIP TRAINING/MENTORING CORNER
In August of this year the Silver Fox Advisors introduced a new offering in its monthly newsletter which is called the Leadership Training/Mentoring Section.
In this section a thought-provoking situation will be presented. In most cases these situations will be real life circumstances. Our readers will think about them and play them out in their minds or on paper, as they consider what they would do or should have done if these incidents actually happened to them in their businesses.
Being a good leader requires you to be able to react to unexpected happenings or developments. Our Silver Fox Advisors have experiences they want to share with you that they have managed through, with the hope of providing you with some touch points so you can become more than a good leader but a GREAT LEADER.
There is an added benefit: if you respond to us and provide a reply to this situation, and your response is selected as the best, you will be awarded a seat at one of our Lunch & Learn events.
NOVEMBER LEADERSHIP SITUATION
You have the opportunity to expand your business to a new market about 200 miles away completed a business plan and loan request package, which you presented to several banks, all of them have declined your request.
Your brother-in-law has offered to provide you the money needed to expand your business, but he wants to take a security interest in your company’s fixed assets (land and building) and obtain a minority interest in your company, which converts to a controlling interest if you can’t pay the loan back.
WHAT SHOULD YOUR NEXT STEPS BE?
Please provide us a brief write-up of What are your next steps? Send your write-up to Lynn Rosado at [email protected]
In our November 2025 Newsletter, one of our Silver Fox Advisors will provide a response to what he or she would have done and what precautions he or she would have taken in this October Leadership Situation.
If you need assistance in becoming a better leader, I recommend you start by contacting the Silver Fox Advisors. Silver Fox Advisors are former or present business owners themselves, and they have leadership experience in running a business, and in some cases several businesses, and have dealt with unforeseen and unplanned situations throughout their careers. We encourage you to visit our website at www.silverfox.org to select a Silver Fox Advisor and also to learn more about the Silver Fox Advisors, as well as our great programs and community outreach endeavors.
