Whether you’re a solo preneur or running a large company, you need a business budget to understand where your money is coming from and where it is going. A business budget template can help organize the numbers so you can easily track revenues, plan expenses, and save for future growth.
You don’t have to be an accountant to organize your business budget. There are thousands of business budget templates that simplify the process. Once you know what a business budget is and how it can work for you, you can use one of the free templates below to help organize your finances.
What is a business budget?
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A business budget is a spending plan that estimates a company’s income and expenses for a specified period of time, usually monthly, quarterly, or annually.
The business budget follows a set template that you can fill in with estimated income plus recurring or expected business expenses.
For example, if you run a digital marketing company, you might know that you typically make about $ 10,000 for your campaign creation work, plus an additional $ 5,000 for your digital courses. You would list the estimated earnings from all of your company’s revenue streams as cash receipts for the company.
Then you have your recurring expenses that you would list as money going out. This can include employee salaries, office costs, and software and technology costs.
How to create a business budget
Creating a business budget is a simple process, but it can be more complex for larger companies. Here are the basic steps for creating a business budget.
1. Find a template or create a table
There are many free or paid budget templates online these days. So you can either use one of these or create a simple table with custom rows and columns based on your company. Below we list some helpful templates.
2. Enter income
Once you have your template, first list all of your company’s sources of income. With a budget, you plan for the future, so you need to estimate this based on previous months or years of income. For a new small business budget, rely on your market research to estimate early earnings for your business.
3. Subtract the fixed costs for the period
Fixed costs are the recurring costs that you have each month, quarter, or year. Examples are insurance, office rental, website hosting, and the Internet.
4. Take variable costs into account
Variable costs change from time to time. Examples are utility bills, advertising costs, office supplies, and new software or technology. While you may always have to pay some variable costs like utility bills, if your estimated income is below average, you can also reallocate your expenses to things like advertising expenses.
5. Planning the business budget
There may be unexpected expenses or you may want to save to grow your business. Either way, after taking into account all expenses, fixed costs, and variable costs, you need to review your budget to see how much money you can save. It is advisable to create multiple savings accounts for emergencies and for funds that you want to flow back into the business to encourage growth.
How to manage a business budget
There are a few key components to managing your business budget in order to keep it healthy.
The process begins with properly preparing and planning the budget at the beginning of each month, quarter, or year. You can also create multiple budgets, some short term and some long term. During this phase, you will also set spending limits and create a system to monitor the budget on a regular basis.
Larger companies allow you to delegate budget tracking to multiple managers, but even if you’re a one-person show, you’ll need to monitor the budget on a regular basis. That means setting a time on your schedule each day or week to review the budget and keep track of actual income and expenses, and then compare the actual numbers to the estimates.
With regular budget tracking, you can always know how your business is doing. Check back frequently to see how your earnings are doing, where you are losing, where to minimize expenses, and how to put more money into savings. You can use well-tracked budgets to create more accurate budgets for future periods.
Why is a budget important for a company?
Having a budget is vital for businesses. Without one, you can easily drown in expenses or unexpected costs versus incoming funds.
The business budget helps with multiple operations. You can use a business budget to keep track of your finances, save money to grow the business or pay bonuses in the future, and prepare for unexpected expenses or emergencies.
You can also check the business budget to determine when to take the next leap for your business. For example, you dream of a larger office building or the latest software, but you want to generate healthy net sales before buying.
The best free business budget templates
1. Marketing budget template
Knowing how to manage a marketing budget can be a challenge, but with helpful free templates like this Marketing Budget Template Pack, you can keep track of everything from ad spend to events and more.
This free bundle comes with eight different templates so you can create multiple budgets to determine how much money to spend on marketing and the return on your investment.
2. Small business budget template
Finding the time to prepare a budget can be difficult for small businesses, but keeping the business healthy is important.
Capterra offers a budget template specifically for small businesses. It works with Excel, and you enter forecasts for the year. Then the table projects the monthly budget and you can enter your actual income and expenses to compare and easily see gains and losses.
3. Startup budget template
What if you don’t have previous numbers to rely on to make profit and expense estimates? If you’re a startup, this Gusto budget template will help you create a budget before your company is officially in the market. This will help you keep track of all of the expenses you need to get your business up and running, estimate your initial earnings, and determine where to pinch pennies.
4. Free business budget template
You may be familiar with Intuit because many businesses, large and small, rely on Intuit for services such as Quickbooks and TurboTax. Even if you don’t use the company’s paid financial services, you can still take advantage of Intuit’s free budget template that works in Google Sheets or Excel.
It has multiple spreadsheet tabs and simple instructions. You enter your income in one tab and your expenses in another. You can also add additional tabs if necessary. Then the spreadsheet magically uses the data in the Income and Expenditure tabs to summarize the information and even determine the net savings and final balance.
5. Department budget sheet
A medium to large company has several departments with different budget requirements. These budgets are all accounted for in a large, company-wide budget sheet, but a specific template for each department can help teams keep track of spending and plan for growth.
This free template from Template.net works in either document or table format and can help various departments keep track of their income and expenses.
Create a business budget to help your business grow
Building your first business budget can be daunting, especially when you have multiple sources of income and expenses. But once you’ve got it set up, it’s easy to replicate on a regular basis, and it’s even easier to get started when you have a business budget template to follow.
With a helpful business budget template, a little planning, and regular monitoring, you can plan for the future of your business, including bonuses, new product or service offerings, and enhancements.