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Even though it is possible to start a business on a shoestring budget – it isn’t possible to keep it running that way for long. Unless your business is a solo venture with everything totally automated – you are going to have a couple of overheads, and eventually, you might want to grow too.
If you don’t take care of your money from the start, it makes it much more difficult to try and manage money later on.
So how can you make the most of your budgeting?
If you have employees, get them involved with making smart financial decisions. And it’s not just about them making smart financial decisions; it is about clarity too. Being clear with your employees about the financial future of the business, how it stands now, and any of the tough decisions should be clear.
All of you will look at the budget in a different way – but it means that you are clear, and your employees can make informed decisions about their careers and what is expected of them in the future too.
You might be tempted to either underpay yourself or underpay staff – both of these aren’t a good idea. Your business budget should have enough space for you to be paid fairly and your staff too.
In the early months, many business owners scrap by not very much, but that is not a sustainable way to run a business, and when you do take a salary, it is going to feel and look even more impactful.
Most of the time, you will need to make guesses about your expenses. Unless you put the time and effort into not only finding tools, software, and companies like DoiT International, you’re always going to be on the back foot.
You need to anticipate expenses early and make adjustments. Anything that you use will have a cost attached, so start making sure that you are carefully tracking your spending and can make informed forecasts for the future.
In other words, plan well for expenses and always use tools and software that can give you better estimates for costs (or have a set cost).
Unless you have a service or a product that has no downtime, you will likely have a high and low season of sales.
There will be down periods, and what you do in these weeks or months makes a big impact. Any downtime that you have should be used for admin, marketing, and anything to bolster your next season of sales.
Your sales cycle can be powerful when used properly – if not, it will be a huge financial drain. Keep costs down and make cut backs in the down season, and prep for high seasons.
Your budget is not fixed – and you shouldn’t treat it as though it is. Instead, keep coming back to your budget and looking at the actual figures. This will help you to refine your spending, look at profit and loss patterns, and so much more.
Always keep in mind that looking after your credit will give you more options when you want to scale and grow the business at a later date: Build Your Credit the Right Way: A Guide for First-Time Business Owners – 🍉 FangWallet.
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