The Perks of Two-Year Budgeting

Laura Neumann, Acro Commerce’s controller, examines the benefits of setting a budget two years in advance. Learn how this type of financial preplanning improves efficiency, tracking, and modelling.

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Acro Commerce uses a two-year budgeting strategy, providing great benefits for our management and finance teams. 

Biennial budgeting is the practice of preparing and adopting budgets for two-year periods. It helps companies focus on long-term and strategic aspects of budgeting rather than narrowly concentrating on "number crunching" for a single year. A two-year budget is also a better complement to a long-term strategic plan. Additionally, biennial budgeting leads to more consistent company-wide priorities from year to year.

Why Did Acro Commerce Change to Biennial Budgets?

The decision to shift to a two-year budgeting strategy was motivated by a range of challenges we encountered. 

Firstly, we recognized that delays in decision-making arose as management waited for budgets to be finalized for the following year. Moreover, there was a clear desire to enhance our ability to make projections over an extended period of time. 

Finally, there was a need to efficiently track long-term contract changes and anticipated price increases that would fall into future years. 

By adopting biennial budgeting, we aimed to overcome these obstacles, allowing for greater foresight and strategic planning capabilities.

Benefits of Two-Year Budget Planning

• Efficiency—Although budgeting in two-year increments requires a bit of extra setup work in the first year, the efficiency gained in subsequent years is well worth it. Maintaining two years' worth of data means that when budgeting season rolls around, we are already halfway done and have a strong starting point to build upon to complete the process. 
• Tracking—Throughout the year, we are able to track long-term changes within our budget. Gone are the days of gathering detailed lists of upcoming changes that will need to be implemented in the following year once the budget is prepared. Making those changes and seeing their implications in real time is invaluable.
• Modelling—Following this strategy allows us to take a long-range view of our data. Even when coming to the end of our fiscal year, we can rest assured that we will have at least a full year's worth of modelling at any given time. This way there are no roadblocks for our teams in waiting for a new year’s budget to be approved and implemented before they can start to make decisions for the new year.  

While our expertise lies in web development and integrations, we feel it is important for our clients and prospects to understand why and how we do things behind the scenes at Acro Commerce. By building a strong foundation, we are assured of long-term financial stability, allowing us to continue to serve our clients well into the future.

A stable partner as your development agency just makes sense.

With more than twenty-five years in business, Acro Commerce is here for all of your digital transformation and web development needs. If you are ready to build for the future of your business with an experienced team, reach out using the form below and one of our experts will reach out directly.