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5 Budgeting Tips to Ensure You and Your Small Business Are Free From Financial Issues


Let’s be real - saving money while running a business can be hard. As many business owners know, managing a company is expensive, especially when you include all of the smaller expenses (like office supplies and printing costs) that add up over time. A great way to stay money-smart is to practice responsible spending and to stick to a budget. But how do you stay on budget and not give into the temptations of splurging on fancy new features for your company? Keep reading to learn 5 tips on how to manage your business spending so that you can feel good about your financial future. 

 

1) Include and track all expenses

As we’ve said, a business has many different expenses each month. A great way to organize your monthly costs is to sort them into 3 categories: 

  • Fixed costs

  • Variable costs 

  • One-time expenses

 

By organizing your expenses into different streams, you can better track where your money is going and what areas may need to be changed to fit your budget. To learn more about what is included in fixed and variable costs, read our previous blog post where we review the basics of business budgeting and how to get a good start. 

 

2) Overestimate expenses

It is always a good idea to be cautious when things are good so you can plan for when things are bad. As a small business, you may not have the resources to protect yourself from unanticipated costs. By overestimating your expenses, you give yourself a safety net for any financial surprises. 

 

3) Understand your industry

It’s important to know the financial landscape of your industry. Prices and expenses vary based on the industry that you operate in. Being misinformed about the costing standards of your industry can lead to false or low estimations in your budget. 

 

4) Determine and understand your risks

Every budget comes with its own risks. You need to be aware of what risks are involved in your budgeting plan. Conduct a risk assessment and ask questions to ensure that you are fully aware of all the possible outcomes. 


5) Update and review your budget semi-annually

Once your budget is created, it is not set in stone. It’s important to review your budget mid-year and make changes as necessary. This review also allows you to ensure that the budget is in alignment with the company’s vision and is making progress in accomplishing its goals. 

 

Ultimately, creating a strong and reliable budget for your business is a crucial part of ensuring its success. Even just one mistake or oversight can launch your company toward financial turmoil. Keeping track of all of your budgeting details can take a lot of time that you, as a small business owner, do not always have. Luckily, there are eager teams of professionals available to take these budgeting responsibilities off your plate. Here at STEPS, we offer small businesses financial assistant services to help you manage everything budget related and more. Get more information by visiting our services page or sending us a message with your budgeting questions on our contact page. 

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