Top Ten Tips on Setting a Business Budget (Part 1)

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Top 10 Tips on Setting a Business Budget
(Part 1)
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One place where many new business owners
unfortunately completely fail revolves around
their budget- either the lack of a budget, the
creation of a very improbable budget, or creating
a decent budget and not following it. Much like a
budget made for running the home, the business
budget is an extremely useful tool in helping to
manage spending, to help gain and overall picture
of business health and of course, is always
necessary for basic accounting purposes.
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Here are the 1st top 5 tips for setting up a
business budget
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• Be realistic.
• When setting a budget for your business, its
  best to not do two things- cut yourself so short
  that its impossible to take some amount of risk
  translating into reward, and on the flipside
  giving your budget such a high value that youre
  allowed to spend like its going out of style.
  Know where your costs are going to be based on
  your businesss projections for that year and
  plan on that. Dont assume that things are always
  going to be bad, and dont assume that the world
  is your oyster right away and spend, spend, spend.

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2. Base your budget on how you, the owner, spends
money and how that fits into how you run your
business. This relies on thinking about your
personal situation- never make a budget based on
a prefab template. This may rely on how you do
you purchasing, how you bill customers, and other
basic functions that are also unique to your
business.
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3. Accurately base your budget on your income
projections. Income projections arent the same
thing as a budget, so never treat them the same.
This is something that should be made clear to
every business owner but unfortunately, is a
common basic mistake new small businesses make.
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4. Include business savings into your budget and
treat it as a basic expense.
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5. If your business deals with cash, find a way
to track that like a hungry hawk on a mouse. This
is an area where most budgets fail.
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