Setting Your Small Business Budget

Most people have a sense of dread when they hear the word "budget" and imagine something restricting and impossible. As a small business owner, it's important that you understand how to set a budget and stick to a budget. Having a budget for your small business is essential. Without a budget, your expenses will outpace your income and you'll lose all your profits.

It doesn't a take a rocket scientist to figure out that this is no way to run a business! If you want to maintain your profits, you've got to:

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1) Increase your income

OR

2) Decrease your expenses

Although it would be nice to instantly increase your income (and if you find the secret to that, please let me know!), most small biz owners need to decrease their expenses. Lowering the costs of doing business is the easiest way for you to get more profits.

There are a lot of ways that you can cut down on your business expenses. Check out these ideas and save some money (and automatically increase your profits)!

One of the biggest areas that business owners go over budget is with software. New software makes us feel professional...and it's just plain fun! Even if you don't exactly need it, software can make its way on to your computer.

Before you download that next program ask yourself how it's going to help your business. Is there a way you can do the same task without the piece of software? Will it really help your business or will it just be a waste of space on your hard drive? If you feel it will really help your business then earn it! Earmark a certain amount of money from your profits to spend on your software and then buy it once you've gotten the money. That way you won't be cutting into your profits significantly or spending before thinking about it.

If there's a software program that you really do need, try to find the smallest version you can get your hands on. Many pieces of software have levels of use. For example, there is database software that can handle hundreds of users and there is a version that is for personal use only. Even if your vision for your business is huge and you imagine that you'll have dozens of employees someday, you don't need the full fledged version right now. You won't be saving money by purchasing it now. You'll be wasting it.

Tell yourself you can always upgrade when the time comes. You don't need to spend the money right now...you have more important things to spend it on! Be strong and put yourself on a software ban. You can be creative and find other ways to get your tasks done without breaking your budget.

Setting Your Small Business Budget

Tricia Mischler is a home business coach and owner of The Blue Jean CEO, the definitive resource for new entrepreneurs. To learn more about starting your own successful business, visit http://www.thebluejeanceo.com and pick up a copy of your free report "7 Biggest Mistakes New Entrepreneurs Make When They Get Started."

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