3 Important Things To Include in Your Company’s Budget
An organized and reliable budget is an essential tool for any small business. It helps keep you focused, lets you track and understand expenses and promotes fiscal discipline. A well-ordered balance sheet will also serve as an asset on any lending applications. Here are three vital areas that deserve extra attention in any prudent fiscal plan.
For most companies, marketing will be an absolute necessity in your budget. It is vital in getting the word out when you open, and both draws in new customers and keeps the old ones returning.
Online marketing is particularly useful from a cost/benefit standpoint. Social media can serve as an effective marketing tool with little cost outlay. Active profiles on Instagram, Twitter, Facebook and other sites all serve to target different demographics and bring in new customers. For more exposure, social media sites also offer paid promotion at reasonable rates. A social media consultant—or even a particularly tech-savvy employee—may be able to help maximize your social media gain.
Payroll costs often occupy an enormous portion of your budget, and some business owners will be tempted to cut corners. But staff are ultimately the essence of your business, and a reasonably-paid staff will always do their best work and remain loyal to your company.
This doesn’t mean, however, that employee costs should put you in a fiscal hole. Get creative! Consider whether you need to hire a new full-time employee, or hire someone on a part-time or contractual basis.
Likewise, in some lines of work (like the construction industry), subcontractors may play a significant role. At the end of the day, you don’t want to skimp on staff costs, but be sure to hire creatively.
If your business is doing well and you end up with a budgetary surplus, consider the ways this money can be reinvested. Perhaps it can be used to fund a renovation, or purchase a needed piece of equipment. Maybe you can hire an additional staffer.
You might also consider leveraging a surplus towards a loan, procuring a larger sum of money in order to fund an even more substantive aspect of business growth. Ultimately, reinvested money will help grow your business more quickly, making you more resilient in the longer-term.
Budgeting is an essential part of running a business, and should be done with the utmost care. Understand your expenses, costs, and business needs, and work to consistently apply funds in the most effective way possible.