Let’s face it: Managing money isn’t the reason many of you started your businesses. But having a solid budget? That’s like having a GPS for your business journey. It helps you avoid those financial potholes and keeps you headed toward your destination (i.e., success). 

Whether you’re just starting out or looking to get a better handle on your finances, these practical budgeting strategies can help you take control of your business’s financial future.

Get to know your numbers 

Before diving into budgeting, take a good look at where your money is going. Pull out those bank statements and receipts from the last 6-12 months. Then, break down your expenses into two main categories: 

• Fixed costs (e.g., rent, utilities, insurance) 

• Variable costs (e.g., supplies, marketing, seasonal staff) 

Tools like QuickBooks® or even a simple spreadsheet can help you track everything. The clearer the picture you have of your spending habits, the better equipped you’ll be to make smart budget decisions.

Set goals you can actually achieve

Having a budget without clear goals is like having a map with no destination. Think about what you want to accomplish in the next few months (and years). Maybe it’s:

• Boosting monthly revenue by 10%.

• Cutting operational costs by 15%.

• Saving $5,000 for new equipment.

Whatever your goals, make them specific and give yourself a deadline. This will keep you accountable and help shape your budget around what matters most.

Create a budget that bends (but doesn’t break)

Your budget should work for your business—not the other way around. Consider allocating your revenue like this:

• 50% for daily operations

• 20% for growing your business

• 10% for savings

• 20% for other expenses

Don’t forget to budget about 5%-10% for unexpected costs. (We all know surprises can—and will—happen in business!)

Focus on what keeps the lights on

When money’s tight, prioritize what truly drives your business:

• Fulfilling customer orders.

• Paying your team.

• Essential marketing.

• Critical supplies.

Look for places to trim costs without sacrificing quality. Maybe you can negotiate better rates with vendors or find more affordable software solutions.

Keep tabs on your progress

Creating a budget is just the start; checking in regularly keeps you on track. Set aside time each month to compare your actual spending against your budget. Notice you’re spending more than planned in some areas? That’s your cue to adjust course.

Watch out for budget busters

We’ve all been there—getting excited about potential income or underestimating costs. Stay grounded by:

• Being conservative with income projections.

• Building an emergency fund.

• Avoiding impulse purchases.

• Sticking to your plan.

Remember, budgeting isn’t about restricting your business; it’s about giving yourself the freedom to grow with confidence. Start small, stay flexible and watch your business thrive.

Need help getting started?

Consider working with a trusted financial advisor who can help tailor these strategies to your specific business needs. Happy budgeting!