Creating Your Business’s Budget

Creating Your Business’s Budget

As a business owner, when you make your budget, you may think that your financial concerns all involve production, sales and investments. While these three components do determine how much profit you will make, you also need to consider these other sides of finance.

Legal Issues

Every business needs to either have a lawyer or know how to reach one on short notice. Even if you have ethical business practices and do not engage in behavior that merits a court proceeding, someone could still accuse you of a crime or misdemeanor. In addition to having a good lawyer, you should make sure that he or she has access to a financial expert witness who can offer advice and testimony related to a wide variety of financial topics.

Healthcare

Depending on how many employees you have and how many hours they work, you may need to provide healthcare for them. Refer to the federal government’s guidelines to make sure that you do not break the law. While healthcare bills may seem like wastes of money, in the long run, they will make your employees healthier and make them more likely to stay with your company. In return, your employee retention percentages will go up and your employees will be happier.

Charitable Donations

Some businesses may not be able to afford charitable donations in their early stages. However, once you can afford to do so, you should dedicate a portion of your profit each year to organizations in need. You could consider donating to local organizations to build a sense of community, or you could donate to a nonprofit whose mission has a special meaning for you.

Business finances are complicated and have many components, requiring detailed budgets. Don’t forget to consider legal issues, healthcare and charitable donations when you plan each year’s budget.  

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