Where expenditure is allocated in proportion to sales. For a new business just starting out, the percentage applied may be taken from figures on industry norms / averages (if available). Alternatively, for a well-established business, it may be based on previous experience / past records detailing sales and expenditure to achieve these sales. With such a method, if sales increase by a certain percentage, then the business (or relevant department) will be allowed to increase expenditure by the same, or a related, percentage. Whilst budgets produced by the sales-related method may be much simpler, less time consuming and, therefore, less costly to prepare, they are less likely to be as effective. This is because they may not reflect changes that have taken place in the market or within the business itself, which require a change in strategy. For example, if the objective is for sales to increase by 10% then the business may simply increase the advertising spend by 6%, personal selling by 3% and sales promotion by 1% (based on previous expenditure figures in relation to sales). However, if competitors are increasing the number of special offers to customers in order to gain a greater market share, then to achieve the above objective what may actually be needed during the budgeting period, is greater emphasis on sales promotion and thus a 3%, 2% and 5% split (respectfully).