Is It Time To Reevaluate Your Small Business Budget? Allie Wolff There are so many things you need to take into account when you run a small business. On some days, you may even feel like you are a juggler balancing an extraordinary number of rings in the air. Each ring has a name: customer service, budgets, cash flow, sales and marketing. If you aren’t careful, all of them could tumble to the ground in an instant. Don’t worry, many business owners can relate; you are definitely not alone. So, if you feel like your small business budget is in a pinch, ask yourself these nine questions. Is cash flow an issue? Your budget, in particular, must be a major concern as it has a knock-on effect on all the other areas of your business. If cash flow is a problem or marketing funds are tight, then your budget could be to blame. Your budget is your financial plan allowing you to estimate your sales and expenses, cover the wages and support your plans for growth. Is there a discrepancy in the actual costs vs. the projected costs? As you move through the year, you should be looking to your budget on a regular basis and noting actual costs next to the projected costs. The difference between the two should provide valuable information. If there is a huge discrepancy between your columns, then it may be time to reevaluate your small business budget. Is it the New Year or end of financial year? Budgets ought to be regularly re-assessed whether it be on a monthly, quarterly or yearly basis. The start of the New Year or the beginning of the new fiscal year are popular options, as business owners generally have a year’s worth of budgets to look over and assess. If you are new to the world of business, then your initial budget may be somewhat of a guessing game to begin with. Are you struggling to meet your expenses? Are you finding it difficult to meet your primary expenses such as rent or utilities? If you find your budget is limited and fails to cover your expenses, perhaps it is necessary to allocate some of the marketing or stock funds to some of the other budgetary categories. Your budget should be practical and usable; otherwise, there is no point spending the hours to create one in the first place. Are you trying to save money? While the struggle to pay your debts is one telling reason to evaluate your budget, it is not the only one. If your goal is to save money to grow your business and you are finding that at the end of each month you have nothing left in your savings account, then again it is worth assessing the situation. Are you spending too much? Can you cut back on your spending so there is money left over in the budget for a rainy day? Is your marketing budget limited? If your focus is on marketing and you have no funds left mid-month to continue your social media or online marketing strategies, then look at where money can be reallocated. Issues like these will be dependent on your particular business and your aims. As long as you are in tune with your business goals, you should be able to determine what may need to change. Have your business priorities changed? Regular budgetary analysis will help you confirm if your goals are being met. If not, you may be obliged to amend your budget or implement changes in your business. It’s only natural that your budget has to adapt alongside your priority changes. Extra funds can be siphoned into areas such as customer service or marketing as necessary. For the most part, your expenditure will remain relatively steady unless you’re making additional investments to allow for busy sales periods. Are you a start-up organization? If you are a start-up organization or have just had a business overhaul, it is imperative to assess your budget at the end of each month to see if it is accurate. There may be unexpected expenses that you had failed to consider when you first sat down to write your budget. There has to be some flexibility in the numbers to handle such situations, or you are going to struggle with cash flow on a daily basis. Plan a budget that will grow with your aims. That way you are not continuously worried about the state of your finances. Overestimating the figures will help you pay any unexpected bills which may arise. Is it time to outsource? As businesses grow, so may the demands on your workload. As a small business owner, you can only do so much in one day. You may find that it is necessary to hire a consultant or outsource some of your workload to make sure that everything gets done in a timely fashion. Additional wages may not have been part of your original business plan. So, if this is the case, you will require an evaluation of your budget to ensure there is enough money in the bank to pay the wages and meet all of your other expenses. Your budget is the lifeblood of your business. In times of cash surplus, it’s easy to disregard the need for one. But without it, your small business ship can quickly veer off course and into choppy waters.