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How to Use Your Business Budget Template

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If you’re building a business, you already know the importance of careful planning. Because financial health is essential to success, part of that planning should be a carefully crafted budget. With the right budget in place, you can tackle any challenge that comes your way, even during those sluggish months when sales are low.

Fortunately, there are tools that can help. There’s no shortage of budget templates on the market, but with so many options, it can be tough to narrow it down to a single one. Understanding your own unique business needs can be a big help. Here’s what you’ll need to know to choose a business budget template and make it work for you.

What is a business budget?

Even if you don’t put it on paper, chances are you’ve thought about a budget at some point. In your personal life, you know to set money aside each month for your mortgage, car payment, student loans and groceries. For your business, you probably know you’ll need a certain amount of money for your office lease, travel costs, website hosting, marketing and supplies. In document form, a business budget merely puts those expenses in writing, allowing you to be more exact in your monthly projections.

The biggest benefit of a business budget is that it puts your business in planning mode. Instead of merely reacting to the bills that come across your desk each day, you can be proactive, setting aside the money you need in advance and spending only what’s left over. It also gives you oversight into where your money is going. Over time, you’ll learn exactly what you need to accomplish in sales each month to break even and, ideally, become profitable.

Business expenses recorded on a budget can generally be separated into two categories: one-time costs, such as equipment purchases, and recurring costs, such as monthly rent and utility payments. Startup budgets tend to include more line items in the first category, but every business will have one-time costs to account for throughout the year. A good budget will anticipate and build such expenses into your business planning.

As such, a budget can be useful to maintain proactive flexibility as your businesses changes over time or life throws unexpected surprises in your way. When an income item on your budget takes a hit, or a big one-time expense become necessary, for example, you can look at your budget to see there are other line items that can be adjusted to most easily make up for the change.

You can play with the numbers to see how much you would need to reduce certain expenditures or increase income from certain sources to make up for an upcoming shortfall. Arming yourself with this specific knowledge is the best way to enable swift corrective action when things change.

Typical budget categories include everything from wages to postage. Make sure to think about every little thing your business spends money on so you don’t wind up shortchanging your needs. Here are expense categories that most businesses in any field may need to consider when making a budget:

  • Employee wages
  • Employee benefits
  • Employee training
  • Contractor costs
  • Marketing
  • Utilities
  • Rent
  • Insurance
  • Supplies
  • Equipment
  • Travel
  • Meals and entertainment
  • Postage
  • Building signage and maintenance
  • Professional membership dues

Product-based businesses might also need to consider the following:

  • Manufacturing
  • Inventory
  • Shipping


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Get a business budget template

Although there is a wide variety of business budget templates available, here are a few recommended by experts:

  • SCORE Business Plan Template for a Startup BusinessThis template walks you through creating your business plan, including 11 fillable worksheets.
  • Microsoft Office TemplatesThis one gets points for ease of access. Chances are you already have Microsoft Office installed, so it’s just a matter of downloading this template and filling it in.
  • Smartsheet Business Budget TemplateIncome and expenses are broken into categories to make it easier to monitor cash flow. There are also separate versions for service- and product-based businesses.
  • Vertex Money Management TemplateThis template has a handy, time-tracking feature. The yearly overview setup makes it easy to see, month by month, where your money goes.
  • QuickBooks Free Startup Budget Template and Guide — Geared toward startups, this template has a heavier emphasis on recording the one-time costs that businesses just starting out need to invest in. The template comes with a filled-in example and explanations to guide you in making your own version.

Create your budget

Even with a template in place, you’ll need to pitch in and do a little work. A large part of this work is in the planning stages, since your goals will play a huge part in the budgeting process.

A great way to start the process of creating a budget is to sit down and outline a few goals you hope to accomplish during the upcoming period. If, for instance, you’re setting your budget for the calendar year, what do you hope to attain during this period? Here are some sample goals:

  • Cut operating expenditures by 10 percent
  • Increase warehouse stock by 5 percent
  • Increase marketing expenditures by 10 percent

It’s important to choose goals that you can control. If you want to increase monthly revenue, for instance, find areas you can boost to achieve that, such as marketing. In realizing these goals, it will be clear as you look at your monthly expenditures that you’ll need to move money from one area into another. If you’re increasing spending on efforts like manufacturing, you’ll need to find an area where you can drop costs a little, such as supplies or travel.

Whether you use a template or build your budget from scratch, a large part of the work will be collecting data for your budget. Here are a few line items commonly found in business budgets with tips on where to track down the information.

  • Human resources — If you have an HR specialist, this person can pull reports for you. Otherwise, look into the reporting features of the software you use to process payroll and manage company benefits. If you contract with a third-party provider for services like retirement savings accounts and life insurance policies, they should be able to provide information on your expected monthly costs.
  • Marketing — Businesses that have been around for a while likely already have a set monthly or annual fee they’re paying for this. Gather information on your domain hosting fees and any recurring expenses for online ad accounts you’ve set up. If you work with a graphic designer, determine what future expenses you may have and ask that designer to quote a rate.
  • Manufacturing — If you specialize in selling goods, you likely have a cost to manufacture those items. If you aren’t sure what this will cost each month, work with your manufacturer to estimate an average cost. Also factor in the cost of shipping those goods to your warehouses for distribution, if applicable.
  • Operating expenses — Every business has general operating expenses that remain relatively the same month after month. This could be costs related to rent, electricity, travel and the like. You can usually get this information from your business’s bank statements, but some costs may be unpredictable. In those cases, estimate an average monthly expenditure and include that across all months.

The bottom line

Although setting a budget may seem intimidating initially, the good news is that you aren’t committed. You can revisit your numbers each month and adjust as needed. But having the numbers on paper will make it easier to adjust upward and downward as your business grows and you get a better idea of exactly what your costs are.


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