a monthly budget for businesses

How to Make a Budget for Your Small Business

Many small business owners started the company because they’re passionate about what they do, not because they’re good at crunching numbers. So they’re at a loss when it comes to business essentials such as creating a budget.

We’re here to tell you it doesn’t have to be super complicated. As long as you have a few key numbers in place, you’ll be able to see:

• Whether the business is making or losing money
• How much income you need to cover expenses
• How much money you have to reinvest in the business, hire more help, pay down debt or put into a reserve fund
• Where you can cut costs or increase income
• Whether you can or should take out a business loan

With Xendoo, our monthly profit and loss statement will give you a lot of the essential information you’ll need for creating a budget.


Look through your records and note all the outlays your business makes per month to keep operating. These may include:

• Overhead — fixed, recurring costs such as rent and utilities.
• Payroll — permanent staff and independent services or consultants. Don’t forget payroll taxes and employee benefits.
• Materials — retail stock or manufacturing raw materials.
• Depreciation — on business equipment such as computers or vehicles.
• Debt repayment — on business loans or other investments.
• Insurance — liability, property, worker’s compensation, commercial auto.
• Taxes — income tax, sales tax, business licenses, import duties.
• Marketing — advertising, promotions, business forms printing.
• Incidentals — office supplies, business travel, client entertainment.


Now review your monthly income. Ideally, it is greater than your expenses. Although it is sometimes a good strategy to take a loss for a short period in order to meet a particular goal, no business can sustain long-term losses. You may receive one or both of these types of income:

• Recurring income — consistent revenue from retainers and contract work.
• Expected income — variable revenues depending on the season and other factors inherent in your market or industry.

Next Steps

Now you can start creating versions of your budget for different situations — both good and bad — that may happen to your business, and planning how you’d handle them. For example:

• Your competitor undercuts your prices
• You lose your biggest client
• You move to a more (or less) expensive location
• You boost the sales volume by 5%
• You hire an additional employee
• You obtain a loan to expand your business

Make It Even Easier

Xendoo makes it easy for small businesses to use our professional services by offering flat monthly fees. No variable expense like you get from accountants who charge by the hour; just one simple, affordable number. Try plugging that number into your budget, along with how much more you can produce in the time you used to spend on accounting chores. We think you’ll find that it’s a very smart option indeed.


This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.


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