CFO Magazine: Budgeting for Global Success
A privately-held software company based in California is starting to pursue new sales in Europe. The company has already opened a U.K. office as its headquarters in the region, and is now charting its course into other European countries. As executives there begin to budget for these efforts, they are struggling to understand country-level requirements, in part because they are in a bit of a rush. In particular, they are concerned about whether or not they have captured all important expenses. While they can use their U.S. and U.K. expense bases as a starting point, there will be items that are materially different in other European countries, and if these are not properly captured and planned for, they could have a negative material effect on their budget.
Here, we look at the major budget categories and some common pitfalls finance executives face when going into new territory.