Running your own small business can provide you with loads of freedom and success, but trying to keep a million different plates spinning all at once can also cause difficulties.
From hiring staff, optimising marketing efforts, and most importantly managing finances. Small firms/businesses have less cash reserves than larger businesses and therefore this may mean less flexibility.
It’s therefore imperative for a small business to maintain complete financial control at all times. Unexpected expenses and world events such as Covid can leave small business owners vulnerable in terms of their finances.
Planning is key. So we’ve put together 6 things that you should take into account when budgeting for your business.
1) Have a Clear Budget
There are so many things to keep track of when starting a business, from marketing to acquiring new clients to creating a website and establishing your online presence.
However there is one aspect of your business budget that you should keep track of right from the start. If you want to develop a strong, long-lasting firm/business, you’ll need a precise and accurate budget.
To get started why not have a look at the following:
- examine your income
- subtract fix costs i.e. supplies, payroll, taxes insurances etc
- look at your expenses i.e. equipment, utilities, marketing costs etc
- unexpected costs. Every business has only at unexpected costs it’s essential that you keep a contingency fund available for such events.
- profit and loss. Once you have the above information you can put together a profit and loss statement.
Remember, small businesses are not always profitable every month let alone every year but if you plan well and carry out the steps above you’ll be able to plan for most eventualities.
2) Review Your Software Packages
Depending on the type of business you have, you will undoubtedly have subscriptions and software packages to assist in your day-to-day work. You must review your subscriptions regularly as you may not be using them enough to warrant paying monthly subscriptions.
Why not take a look at software providers such as Sage to see if you can save yourself some time and money? Software packages are usually cheaper if you subscribe to an annual package following which you will find that they probably increase.
So, maybe make a note before the expiration of your package to shop around and see if you can get something like for like a little cheaper.
3) Consider Whether Travelling is Always Necessary
Prior to Covid, it was the norm that if you wanted a meeting with someone you would travel to wherever they were, or they would come and meet you, or perhaps you would meet somewhere in the middle.
Covid actually taught the majority of us that we can save a lot of time and money by meeting remotely via Microsoft Teams, Skype, Zoom etc. With the rise in fuel prices rapidly increasing and with more of us working from home, surely the way forward is to cut out unnecessary travel (you’ll also be doing your bit for the environment!)
You’ll also be cutting down on your expenses which will save your business money!
4) Opt for Digital Marketing Over Traditional
Firstly, you may be wondering what digital marketing is, it can be summarised by the following:
- SEO (search engine optimisation)
- social media
- PPC (pay per click)
- content marketing
- email marketing
- digital advertising
…these are just a small number of things that you can do to increase your brand awareness and traffic to your website.
With more and more people working from home, and more people selling and buying online, digital marketing could be much more cost-effective and efficient than traditional billboards, leafleting etc as your reach will be direct to your audience. However, if your business does still require traditional marketing such as leaflet printing then make sure you use providers such as Where The Trade Buys to get better discounts.
5) Go Green in the Office
Unless you have been living under a rock, you’ll know that global warming is a real issue and we all need to do our bit for the environment. You can do this in your office simply by going green.
There are simple things that you can do in the office such as going as paperless as possible. Where this is not possible, why not use recycled paper from Office Stationery and ensure that you’re printing on both sides?
If something can be emailed, then always do that rather than printing and posting. To ensure you’re not wasting electricity make sure your computers and monitors are turned off every night and make use of any natural sunlight rather than using those terrible office lights that we all despise.
If you’re not lucky enough to have natural light, then invest in energy efficient lighting. We’re also approaching the summer so switch your heating off or put on some extra layer (especially with the cost of energy rising)! Adjust your thermostat and save some money.
6) Be Savvy With Business Insurance
Although business insurance is expensive, there are ways to save money without compromising coverage.
It’s your job to make money. Of course, cutting costs is one approach to boost profits, but a wise small business owner can save a lot of money on commercial insurance.
The objective is to save costs without sacrificing coverage so we recommend checking out insurance providers such as Cover For You to see what insurances are on offer. Saving money is important but you can’t endanger your business just to save money. It’s imperative that you evaluate your protection and any potential risks. You must ensure that you examine your policies thoroughly to ensure you’re not overpaying for your coverage. If in doubt, it is definitely worth speaking to a business consultant who will be able to guide you in the right direction to look after your business.
For a small business you must remember cash flow is king! Taking into account the above and planning will make your business a success!
