Case Study Of Brompton's Budgets

It is important that a business such as Brompton manage their resources and control their budget so that they can keep track of their financial situation. By having a business that is organized the company can run smoothly with limited problems.

Controlling budgets means that business such as Brompton can make sure they do not fall into financial trouble. For Brompton to run efficiently without financial woes it must plan it financial activities in advance. Brompton will have to estimate and predict its financial income taking into account costs, this will be done using data from Brompton previous years. Brompton’s head of finance will look after the budget and will help to predict the income. Brompton will have to have reliable data and will

By having a budget, it allows the different departments to be allocated how much they can spend, this is done so the departments do not overspend which could cause Brompton to lose profit. By having budget control, it allows Brompton to control how much assets they have in the warehouse, the assets such as the materials to make the bikes could have been spent elsewhere and not just sitting in storage, if Brompton had more assets than they needed it means less available physical cash thereby it could affect any plans Brompton have such as creating an advertising campaign or growing the business. By having a controlled budget, it allows Brompton to see which bikes are preferred and which sell more. Without a budget information like that would not exist and could lead to an order of more than there should be for a particular piece of biking equipment, this would mean yet again that Brompton would have less physical cash and would mean more money is tied up in stock then is needed. For a business like Brompton they may carry out consumer research to see which bike of the Brompton range sells best and why, to get this information the marketing team will have

Brompton needs its workers so that the bikes can be built and sold to the customer, this is why Brompton is reliant on human resources to keep the company profitable. The employee’s performance will directly affect the performance of the business as if there is not enough bikes built then Brompton will have less to sell and if the bikes are not up to standard then they must be built again and Brompton will lose money from the bikes that didn’t pass quality control. Brompton can look after the human resources through training, this will improve the development and effectiveness of the staff which allows the business performance of Brompton to improve. If staff at Brompton are not regularly managed and trained it could lead to some staff to get bored and could lead them to lose track of the correct procedures when making the bikes, if the bike was not correctly assembled or not to the right quality then the company would lose money as it would not only be paying to replace the biked but would also be wasting money paying staff to build poor quality bikes, this would damage Brompton’s reputation and could push away customers. The problems of human resources and managing it is that it can be costly to train staff and can lead to lost motivation from the employees if they think they are doing their job right but someone else tells them differently, by trying to increase the number of customers it could push the staff away decreasing the