What percentage goes back into your small business versus the percentage that you keep?
Upon writing a BUSINESS PLAN, these numbers would reveal itself and indicate if your business is capable of maintaining itself. You have to input the numbers for salaries, operational costs, expenses, etc. Put together, you'll have a financial picture of success, weaknesses, strengths, etc. A ideal business will have in-coming revenue that exceeds the expenses.
Pretty much at most 20% goes back into my physical business. Usually less.
Online-wise with websites, maybe 10%? 45% for those that sell physical products I'd imagine.
Last year, approximately 10% of my pre-tax business income went on things such as IT support, software and hardware, telephone and accountant's fees.
I had no spending on postage, raw materials etc, because my output is my intellectual work. I also had no spending on advertising/marketing/promotion, because I get more work than I can accept anyway.
Tax ate up about 20% of my business income.
It is important to invest back in the business, even though the costs are not that huge when you are running an online business.I keep 50% and invest 50%.
80% of monthly profits I put back into the business to allow for quicker growth and expansion, including paying employees, reinvesting in merchandise, location rent, promotions and advertising, 10% goes to the fattening up of the "nest egg" : - ) , finally 10% is used for everything else to pay "obligations" like personal bills , home rent and utilities, groceries, etc.
Once every 4 months (Apr, Aug, Dec) I reverse it to only 20% reinvested back in to the business and 80% for everything else as mentioned. Which 50% gives the nest egg a nice boost and only 30% is used for "obligations". These 3 months are also the most profitable for me, which is why I chose them for my system. End of school, back to school, and of course, Christmas.
However since 30% of profits is triple the usual amount I use for bills and such, it works out to be very rewarding and satisfying to enjoy the "extra cash".
by Kevin Lam4 years ago
If you start any small business, what would it be. I would start a aquaculture farm. A aquaculture farm is basically a fish farm.
by raisingcapital8 years ago
You need to have a plan and find the tools to start up. With the days of “having a job for life” firmly behind us now, the online environment is helping to transform initial thoughts of business start up in to a...
by Simone Haruko Smith5 years ago
What advice could you give to people interested in starting their own businesses? Share your tips and entrepreneurial expertise as part of this week’s Weekly Topic Inspiration challenge! If you don’t know where to...
by captain planet7 years ago
What If you were superman?
by Grace Marguerite Williams5 years ago
America is a great nation. However, the unemployment situation is awry and it is not going change anytime soon as more and more jobs are being outsourced to oversea businesses. Our educational...
Copyright © 2017 HubPages Inc. and respective owners.
Other product and company names shown may be trademarks of their respective owners.
HubPages® is a registered Service Mark of HubPages, Inc.
HubPages and Hubbers (authors) may earn revenue on this page based on affiliate relationships and advertisements with partners including Amazon, Google, and others.