Important Tips for Small Business Budgeting

Starting a small business becomes the runway for those with relatively limited budget. Especially for beginner, it may be hard to manage finances from the start up costs up to the revenue. That’s why a thorough plan for small business budgeting is needed in order to balance between asset and income. Small business credit provider, Headway Capital, on their survey found that although 57 percent of small business owners anticipated growth in 2015, but almost 19 percent of them were concerned about how unexpected expenses.

Keys to Plan Small Business Budgeting

Experts said to the small business owners that if you want your business to be stable and goes on track, you need to keep your finance in order, for example by accounting both fixed and unplanned budgets. Furthermore, you also have to pay attention to another things such as:
·       Understanding risks
Every business certainly has a risk which potentially impacts financial aspect of the company. In order to minimize risks, you need to consider managing both long and short-term risks so that you can decide what financial plan should be arranged in the future.

·       Overestimating expenses
You know that not every project will turn out the same especially if your business focuses on a project-to-project basis with different client in each project. This situation proves that you do not know when is something going to go over budget. The solution is that to make a slight budgeting above the line-item costs. This aims to get prepared if something goes over. In such case, CEO of presentation management company Shufflrr, James Ontra, said that he applies the theory of the cost-moon-stars that mentions: 

·       Paying attention to the sales cycle
This step is important on a small business budgeting since many businesses just run their activities as busy as always and go through slow periods over the course of the year. But if your business has an off period, that is the right time for you to account expenses. Another suggestion said that to better think of strategies to plan ahead for the next sales boom during the slower periods. In addition, innovative and creative identification on how to market your products to the customers is also important in order to keep the revenue coming in.

·       Revisiting budget constantly
Revisiting budget is a must since it will never be consistent or static. Otherwise, it will change and develop as the business grows. This growth and the profit patterns are your reference to adjust budget. Revise your monthly and annual budget so you can get a clearer history of your business finance. For small business budgeting, this step is so helping to know what you can afford to spend versus how much you are projecting to make.

That’s at least 4 important tips of small business budgeting that you can apply to your company. The theory of “time is money” is also relevant for managing budget especially when your business is involving people who are paid for their time. Just keep your products or services good and your customers close.

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