There is a lot to love about owning and operating a small business. Keeping track of all of the costs is not one of them. In fact, one of the few downsides of being self-employed as a business owner is having to put the time and effort into keeping track of all those little details that sometimes get in the way of serving customers. It is part of business. And where the costs of doing business are concerned, paying attention to the details means the difference between profitability and not doing so well.
It is the small costs of doing business that tend to wear on the budget. Things such as payroll software for small business, rents and mortgages, and monthly utilities are big-ticket expenses that are always at the forefront of the business owner's mind. Easily forgotten are the scratch pads and pens, break room supplies, and all the other things that qualify as incidentals in the grand scheme of things.
So how does a business owner keep him or herself from being nickel-and-dimed to death? By doing the same thing the family does: establishing a budget and then tracking spending. There is nothing more to it than that.
Your Budget Is Your Spending Plan
It is probably safe to say that some individuals and business owners fail to budget because they don't really understand what a budget is. In short, a budget is not an iron-clad policy that allows no flexibility for spending. It is a spending plan that acts as a financial road map.
The typical business budget starts with the big-ticket items we have already mentioned. These are known expenses that involve a good portion of monthly outlay. They include things such as payroll, utilities, rent/mortgage, and any professional services used to run a small business. After all of the big-ticket items are accounted for, the business owner adds in different categories that cover the smaller, incidental things. For example, categories might include:
- Office supplies
- Marketing materials
- Annual licenses and fees
- Janitorial supplies
- Breakroom supplies
Finally, every budget needs a means of tracking spending in order to be successful. The best way to go is with budgeting software. Just like payroll software for small business helps the business owner by handling all the heavy lifting of payroll, budgeting software makes tracking spending easier.
Almost all business accounting software includes budgeting and tracking by default. But the small business owner does not have to invest in a top-of-the-line accounting package. There are lots of free open source business accounting packages available online. There are even household budgeting and accounting packages with enough functionality for sole proprietors and other small business.
Getting Back to Your Customers
Small business owners tend to appreciate the opportunity to be self-employed because it allows them to do what they love doing. A big part of that is knowing, at the end of the day, that everyone served by the business is satisfied. This is why it's imperative to keep spending under control. Business owners do not need the added pressure of financial problems when they should be focusing all of their attentions on customers.
Indeed, it is all of those small, incidental expenses that truly add up for the small business. If you are a small business owner, we encourage you to put some sort of budget and tracking system in place to monitor spending. The same as payroll software for small business relieves you of the pressure of doing payroll in-house, a good budgeting and tracking tool will mitigate the need to spend so much time worrying about financials.
Choosing BenefitMall as your payroll, benefit, compliance expert allows you to focus on what matters most - your business. Contact us today.