Budgeting is a crucial aspect of any business, especially when you are just starting out. It’s imperative to be informed on the most important things you should spend your money on and what help you can get in taking full stock of your expenses.
Here are a few tips that can help you spread out your finances in a way that best profits your firm.
Take advantage of free apps like Wave that let you organise and chart every financial aspect of your business, from payroll to accounting. Don't have an in-house accountant or bookkeeper? 'Wave' and other similar apps let you keep track of where the bulk of your budget goes, so you can prioritise accordingly. For larger SMEs that prefer more advanced systems, Quickbooks is an affordably priced option that is lauded by many of its customers.
Not every demographic will take to your product or service, so trying to market to all of them is a waste of time, resources and most importantly, capital. Save money by picking out your target niche and honing your advertising to appeal to those most likely to actually shell out money for your product.
Identify your target audience with minimal cost through survey sites like TypeForm or Google Forms and research panels. Defining your target group also allows you to pick out other similar enterprises targeting the same demographic, so you can zoom in on the competition and stay ahead.
Inexpensive options might seem like a good idea upfront but cheap products are often indicative of lower quality. When it comes to the important things like software and communications systems, choose software and equipment from a reputable company. Quality products will last longer and serve you well, so even if it seems like it costs you more upfront, it will save you excess expenditure in the long run.
Raad Mobrem, former CEO of eCommerce platform Lettuce Apps gives his advice on how businesses can get better quality products without shelling out for the full price. He recommends asking for discounts with business to business (B2B) services, for example purchasing office supplies and equipment. "People understand that you're a small business just starting out, and if they offer discounts, you'll want to work with them in the future."
Social media can be a good, budget-friendly way to let people know about your product or service, but to really get the word out, invest in a publicist or media relations professional. If possible, hire a publicist with more experience. Experienced professionals possess not only the know-how needed to boost your company's profile, but come with the contacts and influence that could get your name out to the public.
Apart from your average monthly expenditure, set aside around an additional 10% of your budget for unforeseen circumstances. This way, you don’t incur costs from unexpected accidents that end up eating up a considerable amount of your budget.