Starting a new business is as expensive as it is stressful and of course, it’s going to require an incredible amount of hard work. That being said; it is certainly not without reward. The more work you put in in the beginning, the greater the reward down the line. However, it’s not just about having to work hard, but smart.
You might roll your eyes at that: the ol’ cliché “don’t work hard, work smart”. But clichés exist for a reason and it’s typically because they’re true. And in this post, we’re going to share some smart budgeting tips on how to budget for a small business.
1 – Delegate
The worst thing that you can do as a small business owner is hold onto absolutely everything. Yes, it is your baby and you’ve worked hard to get to where you are now, – but if you can delegate certain jobs, you can free yourself up with a lot more time to focus on the more important tasks.
In the same breath, it’s important to get your employees involved when it comes to budgeting. Obviously, you don’t need to include every man and his dog, though for those that you have entrusted more responsibility to and have shown promise, their perspective might be valuable (particularly if they head up a department)
2 – Know Your Industry and the Various Risks Involved
There are always going to be financial risks in any industry and it is important that you identify and consider which ones have the potential to affect you. This will afford you the opportunity to ‘plan in advance’ and prepare for how you can deal with such potential pitfalls in the future. It’s not about accepting defeat or worrying too much, it’s about being realistic and knowing that no matter what, you’ve got a way to overcome those obstacles.
3 – Always Overestimate
When it comes to budgeting for various expenses, you should always overestimate as there’s a good chance that you’ll end up with plenty of unforeseen, additional expenses. On the plus side, at the end of the financial year when you’ve spent considerably less than you accounted for, you’ve got some excellent savings.
4 – Time is Money
Time is an even more valuable commodity than money, as without time there is no money. It’s quite simple really. So, when it comes to your working week, you should be budgeting for your time as well. How can you best spend your time and which areas require the most? Tie delegation closely into this and you should be able to best optimise your time into the most efficient way, making as much money as you can, using your time.
5 – Take Care of You
Many small business owners feel bad when it comes to paying themselves and always think to themselves that their money could be best utilised elsewhere. You should never under pay yourself and you should always afford yourself the appropriate amount of time off. Of course, we can’t tell you what to do, but the best piece of advice that we can offer when it comes to budgeting is to: take care of yourself.
People set up their own businesses for a number of reasons, but the main ones are financial freedom and to be one’s own boss. So, pay yourself fairly and enjoy the free time and money that you have while you can! You should be able to leave your business in the capable hands of your employees now and again so that you can de-stress and unwind. You are the captain of the ship, but even the captain needs a little R’n’R, particularly if they’re to be able to perform well when on the job.