Updated: November 5, 2024
Holidays are usually prime spending time, but there are things you can do to prevent unnecessary expenses and maximize your holiday enjoyment.
Spend for Small Business Within Reason
One thing small businesses tend to do during the holidays is overspend, but saving money is much better. It’s okay to be generous, but not if it will put your business operations at risk. Make sure you can afford the bonuses or gifts you’re giving. Make sure that you have a budget for the holiday party. Just because you set a budget doesn’t mean you need to use the whole thing, either.
Don’t Fall for Small Business Holiday Advertising
A new year equals new stuff. It doesn’t have to be the case. Many retailers push overstock and put poorly selling items from the year on sale at the end of the calendar year to eliminate it. If you need something on sale, go ahead and take advantage. But if you didn’t know you needed it before the sale, odds are you don’t.
Save Money for Small Business Taxes
Another common thing we see at this time of year is businesses making big purchases to get more significant tax deductions. There are several problems with this. If you’re buying an asset, you’ll be using a significant amount of cash, but the tax deduction will be taken over time, and you’ll still have a tax bill. Even if what you’re buying is an expense, you’re saving pennies while spending dollars. Why pay a dollar to save thirty cents?
There can also be hidden costs to making purchases at the end of the year – such as inventory carrying costs or delivery charges – that don’t get considered. Generally speaking, if you have a profit, be grateful! Paying taxes isn’t bad; it means you’re making money.
Think to Save Money for Your Small Business
Long story short, think about your purchases. Is it essential? Is the purchase in line with your business goals? Or are you just spending money to save money? Or worse, has advertising taken you?
While these tips may sound like we don’t want you to participate in the holiday cheer of spending, we remind you to be cautious, as this is usually when people overspend. It can bring temporary joy, but the new debt level does not feel good in the new year.
If you know that you want to do some holiday shopping for your business, take some time to consider your needs carefully and if upcoming sales will work best for you. Then, stay within your assigned budget and celebrate taking care of your money.