Oh no! I can see a whole lotta entrepreneurial business wooers running for the exits as soon as the word Budget gets into the conversation.
Hold on! Sit down, maybe snack on some comfort food… how about a nice big piece of home-made pie? … and let’s rethink this budget word for a bit.
The low regard we have for the concept of budgeting as a whole makes sense.
We can’t chalk it up solely to the dislike for structure that characterizes many entrepreneurs and independent business owners. It’s pretty well ingrained in all of us. After all, look what comes to mind instantly. Thoughts like… Tight Budget, Low budget, No Budget… pretty unpleasant stuff to contemplate. How do we get to Medium, Large and Extra-Large Budgets you ask?
Having an unlimited budget seems like a dusty old relic of history, here in 2016. On the political side, every since tree Great Recession, and with Brexit looming large, governments at every level are dealing with Broken Budgets in news story after story, ad nauseam. Even venture-capitalized start-ups don’t have nearly as much free rein as they used to for their “Burn Rate.” The hidden clause in many a venture-backed firm is a near-vow of poverty for early entrants until cash flow come into being, so don’t be fooled. Many new ventures as self-funded until that can pond there market worth. Even crowd-funding has its allocated-fundind restrictions. But those are topics for another day.
Is there any good news, or at least a more palatable mindset on the matter of budgets?
I Googled “Budget Examples” to see what’s out there. Well, 20,200,000 Budget Examples came up in just one quarter of a second. Wow! Clearly, a passel of people have done the work to construct can-do formulas, or offer their opinions, for keeping track of money. Do we care?
Honest answer? No! I didn’t even read the first 10 of those Example Budgets. (I feel bad for the ones buried at the end of that long Google list. I’ll bet they never see the light of day!) Every time I ask a room full of business owners what tasks they’d really like to give up, it’s always bookkeeping, accounting, and all sorts of numbers-crunching at the very top of their lists.
Do we we like Budgeting any better in the digital age, when a mouse click or two can “run the numbers” on your business, in depth, at a moment’s notice? Are we happy about all these digital budget tools? Not really! Because that creates even more pressure to “Stay on Budget,” which many feisty business owners see as cramping their style. Yech!
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So let me bottom line it for you. Now that you’ve finished your slice of pie, remember this:
“If you count it, it will come.” If you don’t, it won’t.
Yes, I’m talking Budget, and Money, here. Revenues, cash flow, hard dollars, and profits. No kidding.
I’ve done it both ways, counting, and not counting, just like most entrepreneurial types.
Guess which one works, and which one doesn’t? Yup, only counting works. No matter how bad the “Economy” out there is.
Oh, we could get fancy, and make a Google-sized list of all the reasons why budgeting is hard, and business is tough.
I get it. And, I am in no way trivializing the very uncomfortable shifts many of us are tangled in, business-wise, and the ripple effect that has in all areas of life. Making sure to get the right support, so you don’t stay stuck or isolated, is essential.
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Psst. Here’s are two simple secrets to begin Budgeting.
#1: Keep it basic & Keep it current.
“Count” the sum total of revenues in hand: every single business day. Get a hold of that one number.
Every Single Day! It doesn’t take long at all, and the more you do it, the faster it gets.
You will be amazed at what happens once you build that amazingly simple little habit. Because Budgeting is not only about what you spend. Yes, do get your computer to do the heavy lifting.
Make that one mouse click Every Single Day. If you miss a day, just start counting again the next day! It’s not a punishment, or a contest. It’s a habit being built. Inside of 21, or 30, or 90 days at the outside, you’ll have created a powerful habit, and deeply shifted your business perspective, and gained entry inside the gates to mogul-land.
Write you daily reviuens toal on a list. It can be a spreadsheet, by date, but doe snot have to be for those who don’t like spreadsheets. A simple list will do.
Once you have done this consistently for 4 weeks, do it again for the next month util you have 2 solid months under your belt and listed.
2 months in, you can consider getting fancy, and may discover you want more data. Go for it. Or just keep counting that way you have been, but don’t stop.
Having a budget does not mean there won’t be any surprises, or space for spontaneity in life.
In fact, you now have a magic yet grounded way to allow for the unexpected and still stay solvent. To the savers in life, this is a no-brainer. To the spenders in life, it;s a revelation.
When you have budget categories, and life brings unexpected needs, preference or opptunties, you can reallocate moment from one budget s category to another.
It’s not a shell game, but it does give you room to move while still being responsible to stay inside the pie you’ve got and room to meet the goals you’ve set.
Start with a guesstimate of the 6 core payments essential to any business each month. If you pay zero for any of them for several months in a row, that’s a red flag in itself, stifling growth, or signaling key challenges. Here’s a streamlined list:
- Fixed Overhead (utilities, phones, computing, debt payments, quarterly taxes, etc.)
- Production Costs (direct expense and raw materials, what it takes to make and get goods out the door)
- Wages (hourly, salary, paying out commissions or royalties)
Once you create the habit of counting your revenues Every Single Day, then Budgeting, with expenses included, will cease to be just icky-tasting medicine you have to swallow.
Working on your Budget will be a lot more like slipping a mouthwateringly fresh-baked pie out of the oven, and slicing it into tasty pieces for a celebratory party with friends you chose to invite. And there’s plenty more pie where that came from… because you have a recipe!
Yum! I can almost taste that Plump Budget Pie right now. Will yours be a La Mode, with something spicy drizzled on top? Yum!
— Diane A. Curran