Is there a budget in your future? In your past? Are you on budget right now?
If you're a small business, you had better be on budget! While that doesn't mean living a life of pure austerity - it does mean paying attention to your spending.
Austerity, according to the dictionary, refers to "markedly simple or unadorned." Many of us start out with austerity budgets - with second, or third, hand furniture, set up in our basement or dining room. Our budgets are beyond austere - they're non-existent. I talked to a young man just this week who said he and his wife put all their monies into his new business and were living off credit cards now. His budget has gone beyond austere and into... desperation!
But, if his passion is any indication, he will break out of the austerity life has imposed upon him, and enter the comfort zone of doing business on a real budget, with real money, focused on real spending, soon. Yet, he may find himself turning, once again, to his credit card.
The neat thing about credit cards today is that they come with a good many perks. For instance, you may be offered a tool to track spending, via your credit card. I know I use my Visa Business card to actually show me, month to month, what I'm spending on. The key is to make sure the card is only used for business and that you're aware of your spending habits.
While Visa Business cards can help you track your spending (what did you spend on restaurants or gas, this month, and how does it match up to spending overall?); enrollings in Visa SavingsEdge with your Visa Business card can get you discounts (yep, you can get discounts on those restaurants and even gas, sometimes). With the discounts appearing on your statement, that's another way to track savings. Some cards even forgive late fees, in difficult times.
The small business budget is like a living breathing creature. It needs attention - are you overspending on little things, like coffee shop meetings, or paper products, simply because you aren't tracking your costs?
Your budget needs respect - it can't take care of you, if you don't take care of it! Managing it means a weekly review and thoughtful planning. Little Orphan Annie can sing "the sun'll come out tomorrow" all she wants, but if you aren't giving your small business budget the true respect it deserves, there'll be dark days ahead for you!
Your small business budget can be the first indication of success or failure. Here are 4 Must Do Things to keep your budget healthy and happy:
- Track your spending. Visa Business cards can help. They not only track spending, they have security features like zero liability on unauthorized purchases.
- Be prepared. You should know, well ahead of time, what you need to get through the week or the month. Include small purchases like that coffee at your next meeting, or buying your new client lunch. Don't clutch your throat in surprise when your credit card bill arrives every month. Be prepared to pay it off, or pay it down.
- Admit when you can't afford something. This is a hard thing to do - you want folks to know you're successful, or at least think you're successful! Surely, that means you're springing for the bagels this week! Not so. Tell the people who need to know that bagels aren't in your budget this week, but you'll do bagels and coffee, in the coming months.
- If you must tap into your savings or use a credit card to get ahead, be frugal. Know how much you're using and how you're going to pay it back, when the time comes. Never assume you'll be on your feet next week or next month, and you'll pay it back then. Assume you'll need to work a little harder for the time being - make more contacts - and figure out new ways to bring in some cash.
It's not easy living on a small business budget. But, you can do it. Hang out with other small business owners and you'll be right at home!
I am blogging on behalf of Visa Business and received compensation for my time from Visa for sharing my views in this post, but the views expressed here are solely mine, not Visa’s. Visit http://facebook.com/visasmallbiz to take a look at the reinvented Facebook Page: Well Sourced by Visa Business. The Page serves as a space where small business owners can access educational resources, read success stories from other business owners, engage with peers, and find tips to help businesses run more efficiently. Every month, the Page will introduce a new theme that will focus on a topic important to a small business owner’s success. For additional tips and advice, and information about Visa’s small business solutions, follow @VisaSmallBiz and visit http://visa.com/business.