Budget as a Small Business! CB47

[@bcbloc02]

"Money isn't everything but if you run out of it it sucks" That is so true!! Always important to know what money is coming in and what money is going out.

[@beachboardfan9544]

This is why I come to this channel it has to be the best all in one channels. CAD/CAM, Machining, technology, software, business, finances! Great channel.

[@jasonrussell6534]

"Accounting for the numberphobic" is a great resource to get a good understanding of why you look at some reports and the usefulness of each, in real world understandable terms. But that said, this video is GOLD. Very good resource!

[@prodesign8189]

Speaking of money coming in, I rec'd my first quote acceptance to make 100 Nylon parts! I test ran some and they came out awesome. Thanks again John for all your insight!

[@prodesign8189]

lol...how funny.

[@firstlast7867]

John, Nice going, you have allowed your viewers to read between the lines. This is a very generous view you have presented, one not many are willing to share. John tells you he is not the greatest machinist in the world, he doesn't have to be one; he is the boss, he has to recognize a great machinist when he sees one, no more, no less. Accounting is the language of business; if you do not understand it, perhaps you might consider getting a job, it will save you a great deal of pain and probable failure. Nice job John! Dennis L.

[@jodyolivent8481]

Anything that involves a spreadsheet equates to fun for me :) thanks for sharing your method. it will come in handy as my business grows.

[@MikeDittmanmachining]

I'm really liking these videos on the behind the scenes business stuff. I know my first two years were riddled by mistakes but I'm still going and things are looking up for me.

[@derrickvance9790]

Any plans to ever do videos on determining burden rates and hourly rates for machines.

[@rstubocca6737]

Brother! You are a pretty courageous and generous human being. I've been watching/admiring your work (through your videos) for a while now. Your insight, in all of your videos, is priceless to someone like me; especially this type! You've got much love and appreciation here.

[@rstubocca6737]

No, Thank YOU! Haha. I feel that I carry the same attitude as you, for the most part; but especially the same passion in machining and, just as importantly, the business of it! I'm about 6 years behind you though ;) I look forward to watching up on your continued growth! Keep on keeping on man. Life's a garden, dig it, and make it work for you. Hehehaha (I couldn't help myself...)

[@collinsmwangi3744]

Hi John, thanks for the great insight and for sharing one of the most crucial elements of any business, big or small. You have no idea how many people will benefit from this. Keep up the good work...

[@norahung588]

Budgets so important no doubt.

[@Abom79]

Great video John! Thanks for sharing your knowledge with us.

[@billmoran3812]

John, As a former small business owner, I applaud you for sharing this. There is more to running a successful business than being a great machinist, welder, engineer or whatever. A good business needs great craftsmen and good managers and accounting. One of the bis problems in American business is that these talents aren't valued equally. Too often good design suffers from accounting or management bad decisions. Companies like SMW are the future. Lean, agile, able to see their place in the market and make good business decisions. I wish I had the benefit of your knowledge 40 years ago when I was starting out. It took me a lifetime to learn. You have a great future, keep going for it! Don't know if I can make this year's open house, but I'll try.

[@horsekid98367]

I used to be a bankruptcy attorney, and it was rare for business owners who came into my office to be able to provide me with an accurate profit and loss statement. Once they figured everything out, they usually netted substantially less then estimated, often it was a negative number. I'm now self employed, and keeping track of the numbers can be a pain, but it's absolutely necessary so that you know what's going on.

[@prodesign8189]

I just revisited this one. This bookkeeping talk is so helpful now. I had to talk to a loan officer/bank today about where I am currently and what you said about being able to look them in the eye and confidently tell them where you stand is great. I was at least able to show him my previous year earnings, but I think I need to start using a program to keep things cleaner going forward. I'm just soaking up as much as I can before I make another investment.

[@rickwebb3172]

I prepared a nearly 1M budget yearly when I ran a in plant print shop for a large company - 1700 employees. In 11 years the biggest mistake I could make was to budget money and not spend it, even if it turned out I didn't need it. The most ridiculous thing I had to deal with was purchasing new equipment. I could spend $50k (unbudgeted) to fix a broken machine, but couldn't spend $10k to replace it. I fully understand that budgeting is a great tool, particularly for forecasting cash needs, as long as you don't go too far. Thanks for all you do.

[@zaldypangan4312]

its another learning tips for me me john, thanks , and also to NYC CNC

[@billgreathouse1913]

Just finished the book that you recommended last week. quick read and very concise. I'm a late bloomer so I'm only just now considering stepping out on my own. At 47, it's a scary as hell proposition. I just completed my own version of your budget and it's stunning how similar they are. Thanks for the reinforcement. My current job looks like it has a bleek future as the products that we manufacture are as old as Edison. Technology is gonna pass us up at some point. I'm a classically trained machinist and toolmaker and jobs in this field don't seem to be paying what I've been making. It's time that I quit being lazy and get going. your inspiring to say the least and I enjoy all your videos. question on the tormach. what do you think that the reasonable service life is for the 1100 with all the bells and whistles. understanding that I fully appreciate the real performance envelope of this type of machine. I simply want to use it as a fail fast and cheap, possibly catalyst for something much bigger. just trying to engineer my future if you get where I'm coming from.

[@billgreathouse1913]

NYC CNC thank you John, that is very reassuring. I enjoy yout videos. the array of subject matter is very useful and it all ties together. thanks again

[@MakerTable]

Great video, I've got a cash flow spreadsheet that is simpler than this but serves most of the same functions. Thanks for sharing all the nitty gritty details.

[@OzSpeedway]

Loving the channel John, great variety. Just became a patron to your brilliant channel Great advice on budgeting, this info can be used in all walks of life not just small business. Cheers!

[@Dunc]

Please don’t take this the wrong way as I appreciate your videos quite a bit. The formula in C41 is Operating Income and not Cash Flow. Cash Flow would be the section on rows 44:49. If you’re ever interested, I have an Excel sheet I’ve created that you might find useful for budgeting the payroll. The full file does other items as it’s built for corporate use, but I can easily strip out the payroll worksheet as a template. In summary, it budgets by name and breaks out the wages/benefits/taxes by month in a high level of detail. You basically just enter the start date, the hourly rate, the schedule type (if they are on 5-day or 7-day schedules,) the benefit elections if you offer it and it calculates total payroll by month.

[@Dunc]

Yeah I will admit I was splitting hairs regarding terminology. Thumbs up for putting this video together for folks!

[@wfsteenkamp]

Great video John! Thanks for sharing. 👍

[@GregsGarage]

Fantastic video John.

[@Fromeco]

Been in business for 20yrs. When someone asks me for advise in regards to setting up a business, I skip the how to make a friend written by a billionaire books and go straight to learn accounting. Or try to learn accounting, research double entry book keeping, understand what Balance sheet is and how it differs from a P&L etc. And stay out of debt, and if debt is required make sure that debt is making you money. Great Chip Break, budgeting/accounting and knowledge there of can't be overstated.

[@Pilot_Pirx]

You are doing God's work with these videos.

[@jalenjohnson1000]

Excellent Video!! Keep up the great work! Cheers!

[@samuelirons5548]

Had the pleasure of meeting you at IMTS, just I was guy going "hey it is you....the CNC guy on KZbin...

[@aarondickenson7146]

Very helpful video John! Great work ! 👊🏽

[@EZ_shop]

Thanks John.

[@grandjunctionguy]

Oh man I'm envious of that rent. Your building is awesome! I'm finally moving out the garage this month, and I wish I could find a deal like that!

[@p3t3rblu3]

thank you so much.... your are a epic humanness of happness

[@jimnnobody]

The tooling purchase multiplier is always fun.... The known unknown. Capex seems to be a steady 2.5x kick in the butt. :)

[@PeterWMeek]

On bailing out when needed: "When you find yourself in a hole - stop digging!"

[@MorganOliff]

Hey great video John. I'll take a look at the file from patreon. I want to make a dumbed down version to work with.

[@MAKEPARTScom]

A good rule of thumb that I have always tried to stick to is having a minimum of 3 months expenses from your budget in the bank. I shoot for 6 months to a year. For example if you have a budget of 10k per month work to have 60 to120k in cash reserve. Bare minimum 30k.

[@indoorherbivore]

Once upon a time, I wrote spreadsheets for a living. Was going to D/L and tweak yours, but am not a patron. [Love to help out, just no money in my...budget] What version of Excel is that? Looks pretty slick. When I started on Excel, there was little or no automation, if you needed say, a criteria table, well, you did it by hand. I still manage my household budget in Excel, it is a fantastic tool for organizing numerical data.

[@BDMcGrew]

Awesome explanation, thanks man!

[@italoximenes8755]

Loved the video, learnt a lot. Thank you!!

[@survivalisme88]

I am going to start up my own company. The place I’m at at the moment everyone is supportive about the decision. My manager has told me some interesting tips business owners do that is perfectly legal. One being that you can claim you earn minimum wage and claim money back through dividends.

[@steviebsdjservice]

Is this excel file still available? I don’t see the link for it in the description.

[@MrGsWorkshop]

Thanks. Great Video.

[@OldIronShops]

interesting stuff John but I have no skills in acounting. suppose I'll have to learn that to.

[@landlockedviking]

like that 179, wish we had that in Canada! Cashflow is the devil !

[@jimnnobody]

landlockedviking It's the most business-friendly section of the US tax code IMHO.

[@landlockedviking]

jimnhezza man we're like 7 years if has a motor and cost over 500 bucks

[@AdamLundquist]

When the month is over, do you go back and update the sheet to the previous month?

[@b3nsb3nz]

This is a great explanation of core things every small business owner needs to understand. That said I would be totally lost keeping track of stuff with excel, you don't use something like quickbooks for your accounting? I've been using that for 10+ years now and man it makes all this a breeze, all that info is just a click away in a nice report. It also makes tax time and reconciliation pretty easy, every accountant I have ever used just takes my file and does their thing.

[@b3nsb3nz]

Ah ok, I was thinking how the heck is there enough time in Johns day to do all his business accounting stuff in excel lol.

[@bjre.wa.8681]

Why are there property taxes if your renting property? I once tried business buildings depreciation taxes and finally got out, never again. It was extremly complicated with all the extra forms and sheets. I'm not the same person now, that tax filing just about cause me to loose it mentally. Good luck to all those that decide to go there.

[@SoundsFantastic]

Hypertherm Powermax 85?

[@gusbisbal9803]

This is not accounting, this is just common sense. Like walking into the desert and knowing how much water you have. That snot called water accounting, its called "don't be a fool!" It takes relating to money as an asset of survival rather than something that buys shit you enjoy.

[@vinnyvince23]

Can I have your budget? Thanks!

[@occamssawzall3486]

Think I'm gonna go watch a video on like brain surgery or Astro physics or something. You know. Something I may actually grasp the concept of 😆

[@TheGuerillapatriot]

Or if your an older guy, thanks.

[@khtaipei]

sorry... so much lecturing and so little about budgeting