As a business owner youíre probably well aware that just about everything you do for your business can be defined as a project. In fact, you might wisely approach most projects with a project management sensibility. You may establish goals, identify tasks and set deadlines. You might build a team to ehlp you with the projectís tasks and measure success when youre done. Howver, one key step that many business owners unfortunately skip is often ciritcal to success, and peace of mind. They forget to budget their proejcts.
Budgeting Your Project
It may sound like a simple step, howver budgeting your project is also an important one. Youíll need to be able to look at not only your cash on hand and avaialbel money but also your expenses and your anticipated income related to your project.
Cash on Hand
Ideally your existing business budget has a miscellaneous category that you can tap into for emergencies. Hopefully thatís not what youíre using for your project and youíve already set aside cash for the project. If you havenít, take a look at other areas where you can cut back> For example, maybe you reduce your advertising budget for the month to help pay for your project.
You can also hold a fire sale or some other type of fast cash generating event to make money for your project. Try not to go into debt for a business project, particularly a project that you havenít managed before.
Like with any budget youíll want to identify categories for your project. They might include office supplies, contractors and advertising. List the categories and the anticipated expenses for each category. If you already have contractors lined up, great then you can estimate accurately. If not, then consider meeting with a few contractors to get a quote. Compare your cash on hand to your estimated expenses. Make the necessary adjustments to your budget and donít forget to create a miscellaneous category that can cover unexpected expenses.
What income do you anticipate generating from your project, if any? Itís also important to identify this amount because it can help you make good business decisions. For example, if you expect the project to generate $5000 then you know to keep your expenses below that amount.
Tracking and adjustments. Just like with a monthly budget, youíll want to review your budget as your project progresses and make any necessary adjustments. Reviewing also helps ensure youíre sticking to your budget and not going over. If itís a project that is repeatable and something youíll likely do in the future, retain all of this information in a handy place so you donít have to reinvent the wheel next time around.