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Every small business has expenses. It is wise to take some time each month to look over your expenses from the previous month and make sure you are keeping them in check. Maybe you spent too much on something and need to scale back spending for the next month, perhaps you have forgotten about a subscription you are being billed for, or maybe a larger profit will allow you to buy a piece of equipment you’ve had your eye on. In any case, let’s look at the three types of expenses.
3 Types of Business Expenses
- Fixed Expenses. These expenses are fixed monthly and must be budgeted for. In terms of a month to month basis, these items can’t really be controlled. Examples include: Store or studio space rent, website or store hosting fees, insurance, business licenses, association memberships, and loan payments.
- Semi Fixed Expenses. These types of expenses are more flexible than fixed expenses, but are likely to occur monthly. Examples include: Shipping costs, wages for employees, legal fees, phone and internet costs, and electricity.
- Variable or Non Fixed Expenses. Of the expenses to look at each month, the easiest to keep in check are the variable expenses. These expenses change monthly and if you are looking to cut down spending, these are the ones you can cut back on. These include: Consumables like mats and blades, materials for creating products (paper, vinyl, embellishments), equipment purchases (a new Silhouette or Cricut or a heat press), advertising costs, subscription costs for website memberships, and office supplies.
Today, why not take a few minutes to look over your expenses from last month? It’s great habit to get started.
Need help tracking your expenses? I like and recommend Craftybase for Silhouette Cameo and Cricut Explore crafters.
Confess in the comments – do you review your expenses monthly?
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Since 2015, Christine Schinagl has been helping crafters start and run craft businesses through her blog, Cutting for Business. As a Silhouette and Cricut crafter herself, she has a unique take on what works and what doesn’t work in the craft business world. She also enjoys teaching other crafters how to create digital SVG designs, available through the Design with Me series.