All kinds of B2B businesses experience fluctuations in demand, sudden increases in material procurement, slowness in payment collections, etc.

Creating and sticking to a budgeting plan, hence, is a super smart operational practice for a B2B business.

Being without a budget is like being in tumultuous waters without a map to tell you which way to steer your ship to!

A realistic and sustainable budgeting plan enables you to manage your B2B business finances like a pro, even when the going gets tough. Read on for some dependable small B2B business budgeting tips.

Acknowledge Your B2B Business Risks

A good budgeting plan accounts for the major risks your B2B business is exposed to. Some of the risks include:

  • Seasonal availability of manpower and material
  • Upcoming implementations of changes in minimum wage regulations
  • Exposure to natural disasters
  • Need to pay more than going rate for quick and bulk purchase of material for fulfilling a large order

By acknowledging and accounting for the short and long term risks to business output, you can plan for resources needed to mitigate them. Also, it is crucial to understand your business competition in order to take the best decision.

Remember: risk mitigation planning in your budget requires you to first baseline your going business expenses and guaranteed monthly incomes.

Understand Your Money Movements

Once your basic budgeting plan is ready, you will need to devise mechanism to improve it, at least once a quarter. Some new cost heads will need to be added, some will be consolidated, and others will become more nuanced. It’s best to start using an intuitive dashboard application to track your expenses and baseline for better budget preparation every subsequent quarter.


After the ‘What’, Focus on Answering ‘How’

A mistake committed by B2B business managers in budgeting – they know what their business will need, but don’t answer how they’ll fulfill the financing need. Rising costs of doing business, supernormal growth, appraisal cycle for your workforce, exodus of key customers, need to move to a better office – anything could place pressure on your monthly budget. If you don’t have well detailed financing plans in place, panic will set in, and that’s where businesses end up buying expensive debt, or underselling equity. Consider modern financing alternatives like Loanable, for instance, where you can specify your financing need and seek short term, secured, bridging, or personal loans at attractive rates.

Factor in Time in Your Project Budgets

Every project has running costs that keep on accruing even when there’s no real work happening. While preparing a project budget, assign a percentage contribution to these running costs, so that you can estimate your margins accurately. This also helps you allocate adequate resources to the project upfront, instead of introducing mid-way alterations in the budget, which is sure to irk your customer, your business directors, and the project delivery team.

Concluding Remarks

Budgeting keeps B2B businesses firmly on track and prepared for the future. Adopt the tips and methods shared in this guide to prepare your small B2B business’ budgeting plans.