How to Create a Financial Road Map in 2024

“A budget should reflect the values and priorities of our nation and its people.” -Mary Landrieu

And your budget, the financial road map, should reflect the values and priorities of your beer business.

Creating a financial road map is essential for the success of your business in 2024.

In this post, I’ll share the 6 Steps to Create a Financial Road Map, and provide resources to help guide you through the process.

  1. Use Financial Planning Best Practices
  2. Build the Sales and Margin Plan
  3. Create the Operating Expense Plan
  4. Outline the Capital Expense Plan
  5. Summarize Loan Schedules and Debt Payments
  6. Implement Proven Tactics to Train Department Managers


6 Steps to Create a Financial Road Map

#1 Use Financial Planning Best Practices

  • Begin with the end in mind
    • Do you need to hit a certain profit as a % of sales? Make that your target, and work backwards from there.
  • Start and finish on time
    • Deadlines are the key. Set a deadline. Let everyone know. Stick to it.
  • Know your audience
    • Owners, investors, bankers. They may have different needs. Make sure these needs are known and in the plan.
  • Create actionable plans
    • What, exactly, will you do in order to achieve the numbers on the financial road map? Write it down. Take action.
  • Involve your managers
    • If you want your managers to buy-in to the budget, they need to be involved in the planning. Involve them.

#2 Build the Sales and Gross Profit Plan

  • Leverage reports and templates
    • My favorite way to do this is to run a sales and gross profit report by supplier, by brand, by package
    • Then dump this great data into Excel and build a monthly and annual plan for the new year
  • Use key metrics
    • Sales growth % by supplier, brand, package
    • Gross profit % by supplier, brand, package
  • The trend is your friend
    • Look at year over year trends – which suppliers, brands, packages are growing?
    • Look at monthly trends. Did a new package sell great for a couple months and then flame out?  Take note of this when projecting the new year.
  • Don’t forget new suppliers, brands, and SKUs
    • What new items are you taking on in the new year?
    • What items are you getting rid of?  Build this into your new plan.

#3 Create the Operating Expense Plan

  • Use strategy, goals, and objectives
    • You’d think the strategy people would talk to the finance people, but sometimes…
    • Make sure the costs associated with strategic changes, goals and objectives are in the plan. Think: opening a new market, adding new sales people, acquiring a big brand.
  • Review departmental needs and initiatives
    • Ask key questions of managers: what safety issues do we need to address? What will this cost?
    • What tools, resources or training does your team need to be their best in the new year? Build this into the plan.
  • Make the costs justify their existence
    • Don’t forget about the Zero Based Budget mindset. Every cost must justify its existence, not the other way around.
    • Clarifying questions: Will the customer notice if we cut this cost?

#4 Outline the Capital Expense Plan

  • Teach them ROI
    • People love to buy new things (trucks, forklifts, cars, computers).  I love those things, too. But will the purchase of these items deliver an ROI?
    • Show your managers how to calculate the ROI, return on investment of a purchase. If there’s no ROI, do not buy.
  • Insist on alternatives
    • Before pulling the trigger on that $150,000 delivery truck, does it make good financial sense to refurbish or repair the one we have?
    • Consider leasing options as well. I’m a fan of the purchase, but sometimes, a lease option makes sense. Run the numbers, do the math, and make an informed business decision.
  • Use a model to capture the needs

#5 Summarize Loan Schedules and Debt Payments

  • Make a list of loans and payments
    • If you have multiple loans, create a document that summarizes the terms and details. Use this one.
  • Don’t forget any new loans
    • Look to your Capital Expense plan. How are you going to pay for those new trucks? Loans. Get them on the schedule.
  • Build an amortization schedule
    • This is a payment schedule. It’s show the monthly payments along with the break-out of principal and interest.
    • These are easy and fun to build, and very useful in planning out interest expense and cash flows.

#6 Implement Proven Tactics to Train Department Managers

  • Give budget responsibility
    • Define what managers will be responsible for, set expectations, and provide access to data
  • Education and training are key
    • Financial literacy training, business literacy training, systems to communicate and control the flow of expenses
  • Reporting tools
    • Every department manager should have 2-3 key metrics to track
  • Monthly department P&Ls so that managers can understand the costs flowing through their department, their ‘mini business’

Need More Resources to Build Your Financial Road Map?