A budget is a statement expressed in monetary &/or quantitative terms, reflecting the policy of a business and determining business operations in respect of a particular trading period. In a business, organization budget represents an estimate of future costs and revenues. There are two types of budget: capital budgets and operating budgets.
The following stages would be useful while preparing a budget for the restaurant/ catering unit:
1. Establishing financial objectives
2. Forecasting revenue
3. Estimating expenses
4. Determiningnetincome
5. Reviewing and approving the budget
Once the budget is approved, operational budgetary control methods need to be followed for proper financial management by the food and beverage department.
Different types of budgets are prepared for different purposes e.g. sales budget, production budget, raw material budget, administrative budget etc. all these sectional budgets integrated into a master budget which represents an overall plan of the organization.
Budgeting: Budgeting is the process by means of which budgets are evolved for a business as well as the various departments/sections of a business.