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Top ten tips on setting a business budget (part 1)


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What is a Business Budget? Discover some tips for setting up a business budget now!

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Top ten tips on setting a business budget (part 1)

  1. 1. 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.
  2. 2. st 1 Here are the top 5 tips for setting up a business budget…
  3. 3. 1. Be realistic. When setting a budget for your business, it’s best to not do two thingscut yourself so short that it’s impossible to take some amount of risk translating into reward, and on the flipside giving your budget such a high value that you’re allowed to spend like it’s going out of style. Know where your costs are going to be based on your business’s projections for that year and plan on that. Don’t assume that things are always going to be bad, and don’t assume that the world is your oyster right away and spend, spend, spend.
  4. 4. 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.
  5. 5. 3. Accurately base your budget on your income projections. Income projections aren’t 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.
  6. 6. 4. Include business savings into your budget and treat it as a basic expense.
  7. 7. 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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