Budget and Investments Pt. 2


The preparation for greatness.


Last week we dove straight into what a healthy bottom line should look like: Your business operating on a budget and making a profit! Hidden within these first few years of operation are the foundational cornerstones of your rise and fall. I know it sounds like a lot of pressure, but really it is more so that the habits you form today will not only set your future in motion and be the same habits you follow for the lifetime of your operation. There will always be lean months and there will be astronomical growth seasons, but no matter the terrain, you must have a constant. You now and how you operate your business is that constant. The only tool I have found that brings me peace of mind no matter what my month looks like has been my budget.

Think of your business as a gourmet meal. Everyone believes the magic happens when the first bite of decadence is tasted and enjoyed, but every chef knows, that moment is simply the spoils of his hard labor. The real magic occurs as he pours every ounce of his passion, gifting and education into the perfected decadence being enjoyed. His measuring, whisking, mixing, watching and waiting––every attentive minute he gave to produce his masterpiece–– was the real magical moment.

You are that chef dear maker and your business is the decadent dish. Most business owners miss the real magic––the greatness to behold––the preparation. Your mind, money, dedication, hard work, education, passion and willingness to do the grunt work all come together to make your mission great. Some of us miss it altogether while most underestimate its power. Some call it a budget, but I call it wisdom.


When you prepare for greatness, something wonderous is found....greatness!


Where do I start?
A budget provides you with a guideline for the income and expenses you stand to face. In other words, it serves as a barometer for how your business is performing. Budgets manage cost, profits, and determine what your actual worth is. In its simplest form, a budget is your indisputable tool for providing peace and control.

A budget should first include your revenues, costs, and most importantly – your cash flow. Generally, budgets are laid out in yearly increments, then broken down monthly, weekly & daily to back up the numbers and calendar. By the end of your yearly budgeting, you will know exactly how much profit you need to bring in every day you are open for business.

Start with:

1) Cost of labor and materials:

  • What is the total sum of you start-up costs?
  • What is the sum of your operational costs? (including wages, advertising, materials, etc.)

2) What revenue is necessary to support the business’ monthly operation?

3) What is a realistic estimate of expected profits each month?

4) What are your yearly fixed costs? (expenses that remain the same, whether or not your sales rise or fall. Some examples include rent, leased furniture, and insurance, etc.)

5) What are your variable costs? (cost of raw materials you need to product products/service according to demand and inventory level, etc.)



Nothing is set in stone.

Based on your monthly review, make changes to your budget to ensure your bottom line is healthy. First, start by month and then assess your year. It is possible you need to take advantage of free marketing options and devote more of your budget to employee support. You can always reassess where you need to focus your spending according to your costs. For example, if you look ahead at next quarter’s budget and see this month’s sales volume was higher, you can plan vacations, marketing activities and inventory accordingly.

Your budget is here to help you adjust to the natural ebb and flow of your fiscal year. It will also enable you to make educated decisions to grow your business operations in peace and clarity. Once you experience the efficiency of operating your small business on a budget, I know you will never travel blindfolded again.

Nuggets of wisdom:

Self-trust is going to be your greatest ally through this entire journey. You are the visionary that will be taking your mission to the next level and the next and the next. You are going to have to trust that the work you have put in every step of the way will reap a reward. But be mindful if you begin to see that this whole budget business is too much for you to handle. Don’t underestimate the power of bringing in a professional! Consider consulting a trusted CPA, financial advisor or banker to help you create a budget. A trusted professional can help get you started on a budgeting system that will work best for your individual needs.

Until next time,




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