One of the great things about running a small business is that it allows you to more closely interact with your clients. At MeloTel, we have developed numerous business relationships with clients that we happily refer to as “friends”. And yes, sometimes, we like to help our friends out by giving them a bit of a break, if possible.
The more you know about someone, the more you develop a personal concern for his or her well-being. There is nothing wrong with that, of course, but because you are working with people you like, don’t forget that they still owe you money! It’s fine to offer those who are close to you discounts, but there’s a way to do it that will still allow your business to thrive.
After all, you don’t want your business to suffer just because you are working with friends who are on a tight budget! There may be times where you are working within a tight budget yourself and will need a helping hand to get through some difficult patches. On Microsoft.com, freelance writer Jeff Wuorio discusses the ways in which business owners can make budgets work.
The key, says Wuorio, is to remember that being on a budget is not a bad thing. In fact, it’s a good business strategy to set guidelines for yourself that include smart saving habits. There are some problems that arise when working within a tight budget, however. Wuorio offers some suggestions that may help.
Accept the learning curve. Wuorio writes that it’s important to understand that the practice of properly allocating your money towards appropriate expenses will take some trial and error. Learn to adjust your budget, over time, as you go through your list of requirements that will help drive your business. The more you do this, the better you will get at it.
Be prepared to miss your budget estimates and act accordingly. According to Wuorio, “This was rule No. 1 in setting up a budget: knowing that your budget projections are a best guess and nothing more.” As part of your learning curve, you will sometimes need to reallocate funds to certain areas of your budget so that you are able to make up for potential losses in particular areas.
Work flexibly. Sometimes your revenue won’t match what it is you expected to make. In some cases, you will need to trim back your expenses. In other cases, you may need to invest in better advertising methods. This works best, however, when you actually are making more than you expected!
Watch your cash flow. Writes Wuorio, “If you want to stick to a budget, make sure that your inflow more than compensates for your outflow. Monitor your income closely to make certain that you’ll have adequate funds to pay your bills, particularly if your business is prone to long lapses between paychecks.” Check out our next blog for the completion of this list of tips!