Six Thing You Might Forget To Add To Your Business Budget This Year
Creating a realistic business budget is a critical task for every entrepreneur. You must plan not only for regular expenses such as rent, insurance, payroll inventory, but also for the unforeseen circumstances that may arise unexpectedly and can place sudden, additional burdens on your financial resources. If you budget for a few of these surprises, you will be able to manage your expenses and preserve a healthy bottom line.
Technical Support
Computers, peripherals, smartphones and other highly technical equipment have become critical to daily business functions. The acquisition of a virus or a sudden breakdown in your system can bring your business to a halt. Make sure you have budgeted a reasonable amount for skilled IT repair services to get your system up and running quickly to keep your workforce functioning and your revenue flowing.
Rental Equipment
Extreme weather conditions can easily knock out power and bring your business to a halt. The rental of generators or heating units can easily eat up your profit margin for the quarter. Even unusual heat waves in summer can necessitate rentals of supplemental cooling equipment to keep your workforce functioning. Flooding or roof problems can cause a sudden need for water removal equipment. Make sure your budget has enough money available to allow you to deal with these emergencies. Although renting extra equipment will take some money from your budget, it probably won’t cost you as much as shutting down your business while you get equipment repaired or replaced for a comfortable work environment.
Collections Services
Tough economic conditions have caused many individuals and businesses to go into bankruptcy. The amount of past due invoices on your books can become a drag on your revenue stream. Make sure you get the money that is due to you by using collection agencies, but remember to work their fees into your budget so that this money-raising effort does not become a drag on your own budget.
Legal Counsel
Circumstances can arise that cause disputes with customers, vendors or employees that require advice from qualified legal counsel. These expenses can quickly eat into your annual budget. If you keep a small legal fund and keep it funded year-over-year, you will be able to manage these unexpected legal costs without difficulty. Having experienced legal help will actually save you money on a lawsuit or other type of dispute.
Temporary Employees
Many growing businesses find that it’s a good idea to add temporary or part-time help at various points during the year to handle increased customer traffic or to manage special projects that may not recur. Keep a small amount in your budget for hiring these temporary workers so that you can take advantage of heavy work periods without spending on overtime. Maybe you need to have more staff around the holidays or a certain busy season.
Storage Expenses
Changing business conditions can cause stresses your business space. Keep money in your budget to pay for storage space for additional inventory, temporarily unused equipment or special items so that you can use your current business space more profitably.
Setting up a proper business budget takes time. Make sure you do your research and don’t leave anything out. If you account for most changes and emergencies in your yearly budget, you are more likely to reach the end of the year without spending more than you expected.
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Category: Budget
