When it comes to budgeting for your business, it pays to make sure that your budget is as accurate as possible. To discover a few handy budgeting tips for businessmen and women, simply continue reading!
How to budget for your business:
1. Work out what your monthly rent is or the amount of money which you have to spend on your mortgage each month
If you don’t own your business’ location outright and have to pay rent on a monthly basis, your first step in budgeting for your business’ operating costs should be to note down your business’ monthly rent. Alternatively, if you have taken out a mortgage in order to purchase your business’ premises, make sure to write the amount of your monthly mortgage payment instead.
If you’re lucky enough to own your business’ premises outright, make sure to jot down any rates which you may be expected to pay as the owner of a commercial property.
2. Figure out how much money you currently spend on wages each month
Once you figure out how much money your business currently spends on wages each month, you’ll have a fair idea on whether or not it’s viable for your business to continue to employ each member of your team. Or whether you may need to consider letting a few members of your staff go. Alternatively, you may find that your business can afford to hire extra help.
3. Remember to factor your business’ utility costs into your business’ budget
Many first-time business owners forget to factor their business’ utility bills into their business’ budget. So ensure to factor your business’ power bills and water bills into your business’ budget.
4. Factor your products or services’ materials into your business’ budget
Make sure to calculate the total cost of your products or services’ materials into your business monthly budget.
5. Factor your business’ marketing budget into your business’ budget
Even if your business offers the most competitively priced products or services in your industry if you’re unable to advertise your business’ products and services to your target demographic, your business will be unlikely to thrive. So it’s important to allocate a percentage of your business’ budget to your marketing budget.
6. Consider applying for a bank loan in order to fund your business’ future plans
If your business requires further funds in order to grow, you may want to consider applying for a bank loan. Just be sure to meet with several bank managers in order to negotiate the best possible contract on a bank loan possible.
7. Consider turning to potential stakeholders in order to provide your business with capital
If your business desperately requires extra funds, consider whether or not you’d be interested in offering up a minority share of your business to potential stakeholders in exchange for a large cash investment in your business.
If you’re interested in bringing stakeholders on board be sure to choose stakeholders who’ll also be able to provide your business with valuable expertize. As many stakeholders are successful businessmen and women, in their own right!
So what are you waiting for? There’s no time like the present to use the information which you’ve gained in order to create a useful budget for your business!