Budgeting for Your Houston, TX Business: Expenses Beyond Start-Up

As you prepare to launch a new business or grow your current one, you know that you have to spend money. But, where does it all go? There are many answers to this question, and the Cy-Fair Houston Chamber of Commerce touches on some of them and offers suggestions on how to save without sacrificing quality or service.


Software and Equipment to Cut Costs


The software and equipment that you use to run your business is not a one-time purchase. You must update and upgrade as your need for output grows. You might, for example, barter with a local IT company to exchange your services for theirs. Another idea is to use a credit card when you need to make large purchases so that you can enjoy cashback or favorable payment term promotions.


On the software side, you could use Voice over Internet Protocol (VoIP) to make phone calls via broadband instead of using a phone, which saves on monthly phone bills. You can also save money by using free online tools, such as Google Docs, Slack, and Canva, to run your business. If you find that you need to convert files, you can also find free online conversion tools, too. You can convert docx to PDF easily in only three steps: load your file to the drop zone, watch the tool automatically convert the file, and download the newly converted file.




Payroll may be one of your largest ongoing expenses. But, you must remember that your payroll numbers will change as your employee roster and their pay grades change. Although you’re not required to increase salaries each year, you should budget for cost-of-living raises as well as additional money for higher-performing staff. If you run into a tight spot and need to save, consider temporarily suspending bonuses or reducing lower-wage workers to part-time hours. This way, your management staff are still involved, and it should cost you less to acquire and train new entry-level employees down the road.




Employee benefits are another thing that you should keep in your budget. If you are a small business, you may not provide health insurance, but that doesn’t mean that you shouldn’t have a few perks of employment. A few budget-friendly benefits to keep include an employee discount, vacation days, free lunch once a month, or discounts or special services negotiated with partner businesses.




Training and education for both you and your employees should be a non-negotiable expense. Look for training courses for you that fill knowledge gaps. For example, if you’re not great with numbers, a course on bookkeeping may save you money in the long run. You can also utilize online training and certification programs so that your employees can become certified in everything from project management to supply chain and logistics.




Your utilities are the services necessary to run your business each day. This includes everything from your electric bill to your water bill. But, you may also have other expenses, such as weekly trash service – estimates an average of $178 per month – and internet fees. The best way to save on these is through conservation. For your trash service, invest in a trash compactor that may allow you to cut your dumpster pick up from twice a month to once per month. To save money on internet and phone service, check with your provider about reduced rates for longer contracts.




Any time you sell a physical product, you must have inventory. This might be raw materials used in manufacturing or it could be items, such as clothing or toys, that you keep on your store shelves. Cutting inventory costs isn’t always simple, but there are a few strategies you can use. Sellbrite offers several tips, including tracking your sales to forecast upcoming needs, centralizing your inventory management, and setting up par levels. 


When budgeting for inventory, you can also evaluate your products to see which, if any, might work well on a dropshipping platform. This way, you’re not holding inventory, and your supplier takes care of the shipping and handling.




Gone are the days when you could simply market by word-of-mouth. Today, you have to utilize a combination of digital and printed materials to get your name in front of your customers. Marketing expenses may also be incurred when you host an open house or offer a giveaway on your social media. There is no one-size-fits-all method for calculating how much you should spend on marketing. However, a good rule is that it should be a percentage of your overall revenue, and that ranges from about 6% to 8%. Depending on what you sell, you may even wish to allocate up to 20% of your annual revenue toward marketing.


Community Outreach


Your community outreach efforts are part of your marketing, but this deserves a special mention on its own. Make sure that you set money aside every month to do things within your local hometown. Pay your staff to volunteer at community events, make a donation to your local animal shelter, or sponsor the occasional lunch for nearby school teachers. 


Remember, although you may spend a bit of money here, there are many donations that you can write off on your taxes each year. Staying involved in your hometown not only helps you reach more customers, but it also helps you network with other businesses with whom you might form a reciprocal and mutually beneficial referral network.


Team Building 


While you are the foundation upon which your company stands, your employees are the structure that holds it all together. Another recurrent expense that you may not have thought of is teambuilding. This is especially important when you have a remote staff, as people who know each other in real life tend to work together better at the office, even when the office is on the web. Further, according to Sodexo, team building results in greater productivity, which may lower your overall operating costs. Remember, the more proficient and productive your current employees are, the less likely you are to have to onboard new ones to take up the slack.


Beef Up Your Credit


When it’s all said and done, budgeting, cutting expenses, and saving is a tried-and-true way to build your credit standing. For businesses, this means increasing the ability to source funding as you grow, or freeing up needed cash during down times. With a good credit rating, lenders are more apt to make loans to those with an outstanding credit report. To get a handle on how your credit report looks – and to keep tabs on what the reporting agencies like Equifax and TransUnion are including – download yours free at


Be Strategic about Spending


There’s an old saying that it takes money to make money. This is true in just about all areas, and you will have to whip out your wallet sometimes. But, that doesn’t mean that you can’t save in places that you have to spend. Use the above tips – including using technology to cut costs, staying on top of your credit report, and saving in areas like utilities, payroll and marketing – and you’ll be on better footing in no time.

Connect with and learn from other local business leaders by joining the Cy-Fair Houston Chamber of Commerce.