It may feel as though you've won the lottery when you receive small business grant money, and if you're not careful, you can spend it all up. Using small business grants money wisely takes discipline and knowledge of which aspects of your business will propel you forward if it's funded. Here's a plan for what to do with the money:
Build a Cash Reserve
Some of your money should be used to build a cash reserve for your business. Your goal should be to save three months worth of business expenses in cash. Make a frugal budget for your business to determine what amount to save. Don't include luxury items, and consider cutting those out all together if you want your business to grow. For example, a frugal business budget should not contain monthly entertainment expenses that haven't resulted in you getting clients for more than 3 months. Unless there are restrictions on how you can use the small business grant money, you should add your salary to the cash reserve fund as well.
Spend on Marketing
Allocate six to eight percent of the small business grant money to implementing your marketing plan. That assumes you have one that's written, and well researched in the first place. If you don't know how to create a marketing plan for your particular business, pay a marketing consultant, take a class or attend a training session with some of the money you set aside. Your business will only survive if you market it effectively.
Buy Software to Automate Your Business
t's important to automate your business, so that you'll be more productive and more effective in business. You'll deliver products and services, much faster and better, which can lead to repeat business. Make a list of the tasks that you do on a daily and weekly basis, and determine whether there's an affordable software program to help you do the task. Some examples include:
- Email marketing
- Data entry
- Web inquiries
- Social media marketing
- Web design and development
- Mail and catalog orders (fulfillment and shipping)
There's web based software and subscriptions for all of these, but you'll have to plan how you'll pay to use the applications after the grant money runs out. You could pay for a one year subscription and save for a second year as you make a profit, or from the grant money.
Buy Office Equipment
If you rely on office equipment to do your work, then you should spend money to update it, or make new purchases. The first purchase you should consider making with your small business grant money under this category, is a new computer. If you only have one computer, it will be your backup. You should also consider a laptop computer, so that you have the flexibility to work in any room you want in your home. Buy accessories for your computer, such as additional hardware to expand the memory, an extra laptop battery and anything else that will allow you to work more efficiently.
These are the essentials for how you'll want to spend your small business grant money.
Daphne Mallory, Esq. is the co-owner of Mallory Writing Services and has written more than 100 articles helping home based business owners and entrepreneurs start and market their business. You can learn more about her here.