The best ways to budget for your business
Our economy is on its knees, and everyone is feeling the pinch right now. So, whether you’re an individual, or a business, it is more important than ever to watch what we are spending.
However, I will be going through ways by which you can be skrimping and saving as a business in these challenging times.
Identify your fixed costs
The first step to creating your business budget is to distinguish what your fixed costs are. Some examples of fixed costs are:
- Payroll
- Tax
- Insurance
- Rent
Ascertain your variable expenses
Variable expenses are those that can’t be pinned to an exact cost each month.
Some examples of variable expenses are:
- Marketing costs
- Utility bills
- Replacing old/broken equipment
Try to predict one-off costs
Perhaps you’ve got an old boiler on the blink, or a company car due for its MOT. Either way, just try to think ahead and forecast what might require spending and factor these costs into your rainy-day fund.
Tally it all up
Now you have defined your fixed, variable, and one-off costs you can now add this all up and compare your income to your spending. And from this you can look for ways in which to improve…
Re-evaluate your overheads
Now that you have all your costs written up it is easier to pinpoint where the excessive spending may be. This is a pretty obvious one when focusing on budgeting for your business, but perhaps there are some monthly outgoings that aren’t actually necessary to the running of your business.
Maybe you have been using the same printing company for yonks now and you have just never thought twice about what they charge you. Now might be the time to try and negotiate a better cost, being a loyal customer and all, this is likely to work in your favour. However, if not, perhaps start looking to take your business elsewhere.
Set aside a rainy-day fund
A great way to always be prepared for unexpected costs is to set aside a contingency fund for your business. This could involve stashing away some cash each month, but your future self will thank you for it!
Obtain finance to grow your business
Asset finance is a great way to protect your cash flow. It is also a quick and easy way to get an instant cash injection into your business.
Contact Us
If you could do with a cash flow rejuvenation, why not get in touch to see what we can do for you? We offer a range of affordable loan options here at VAT Loans. Additionally, if you are looking to go down the asset finance route, our parent company WestWon can help. Give us a call on 01494 956 871, or send an email to [email protected].
