The Courier Industry and Budget

Forecasting is a tool often employed in determining unknown variables when preparing a budget while a budget is a detailed plan expressed in quantitative terms that specify how resources will be acquired and used during a specialized period of time.
Budget will enable a courier company to be able to communicate company objectives throughout the firm, focus on planning for the future, effectively allocate resources, reveal bottlenecks, coordinate department objectives with the firm and provide benchmarks for performance evaluation.
Siyanbola Oladapo, managing director and chief executive officer of Bowill Errands Limited explained that budget period varies depending on the organization and different levels of management to execute the budget.
Oladapo, who is a former banker said the budget period could be daily, weekly, monthly, quarterly or annually but noted that the 2010 budget which is yet to be released, has affected the courier industry, which is a service industry.
He said what obtains in the industry now is zero-base budgeting, which as one of the modes of budgeting requires that the budget for virtually every activity in the organization is initially at zero, because to receive funding during the budgeting process  each activity must be justified in terms of its continued usefulness.
He said the above mentioned approach forces management to rethink each phase of an organization’s operations before allocating resources because the budget is not passed as at when due, like the 2010 budget.
On the other hand, he said base budgeting is the approach that set the initial budget for each of the organization’s departments in accordance   with  a base package which includes  the minimal resources  or the sub-unit to exist  at an absolute minimal level, for instance when the budget for 2010 is released latest in January.