In this episode, Mak & G discuss why every business needs a budget, what to do when your business starts to earn money and how to invest profits back into your business.
Mak &G have got their first customer for their new business and they’re excited!
But before they go out spending that new cash they need to properly plan what they’re going to do with their company’s profit.
In this episode, Mak & G look at what companies spend their profits on, the importance of having a budget for your business, and how to invest your profits to make them grow…
“If you invest in the stock market you spend money on buying a stock because you think you’ll sell it for more in the future at a profit.” – G
“When starting a business it’s important to plan for the future, saving money to invest in the future will help ensure the long-term health of a business.” – Ben Jones
00:16 – Getting the first customer for our pet sitting service.
01:40 – What to do when you first earn more money.
02:14 – Why you need to have a budget.
03:10 – What you need to spend your company’s profit on.
04:03 – What investing means and how to invest in your business.
05:00 – Naming our new business.
05:42 – Things to consider when starting a company.
Connect with Ben Jones:
MAK: Hi, I’m Mak.
GRANT: And I’m G.
BOTH: And you’re here for money with Mack and G. Dad guess what?
DAD: What is it? What are you guys so excited about?
MAK: We got our first customer.
GRANT: And almost at the library. We are printing our flyers and he said he couldn’t make it home for lunch.
MAK: So he asked if we could walk his dog today. He even filled out our contract and paid us on Friday. So we better get over there and take care of the scooter. I don’t want to let Mr. Kendall down.
DAD: That’s great kids. Getting your first customer is a huge step forward to running a successful business and making more money. Mr. Kindles’ house, though, is quite a walk. So how about I give the two of you a ride. And afterward we can celebrate with some ice cream.
MAK: Thanks, dad.
DAD: Welcome, Julia Creamery. What can I get you?
GRANT: I want a hot fudge sundae.
MAK: With sprinkles. Can I have it?
GRANT: A cookie dough?
GRANT: Oh, and some frozen peanut butter bits.
DAD: Slow down there, champ you’re loading on quite a bit.
GRANT: Don’t worry, Dad. We’ve got this covered. We’re making big bucks now.
DAD: Oh, really? Well, let’s see how much it all comes out in the end. And what do you want MaKenna?
MAK: I just want a banana split.
DAD: And I’ll have a double chocolate milkshake. All right, that will be $17.05.
GRANT: Whoa, okay, that was more than I was expecting. I think I need to change my order.
DAD: Don’t worry about it this time, g, I’ll cover it. But I think we should discuss what to do now that you’ve made a little bit more money. I know it’s exciting, you feel like you can do anything. But it’s important to learn how to handle the extra money responsibility. If you don’t, you’ll end up burning through all your hard earned cash faster than you can make more.
MAK: That’s gonna point, I don’t want to spend all of our money on the little things and then have nothing left for what we really want.
GRANT: Oh, you’re right. But I really want more ice cream right now.
DAD: It’s okay to treat yourself every once in a while. The key is making sure you are always working within your budget and not spending more than you can actually afford. Sometimes that means you won’t be able to get the little things as often. Or it might mean you have to compromise with yourself to save money.
GRANT: But I want all of it.
DAD: I know. I know. But I have a budget and I have a ton of fun. You have to put it in your budget. And it feels really good when you do get it. Maybe not the biggest bowl, but it still tastes awesome. Here’s your order. Enjoy.
GRANT: Your eye dad. This does taste delicious. Oh, wow. Wow.
MAK: So wait, should we be working ice cream into our company’s budget then?
DAD: You might need to account for food expenses in a business budget for times when he can’t get back home between jobs. But I’m talking more about your personal budget for your business. You can decide how much you want to invest towards future growth and how much is left over for you to take for yourself.
GRANT: So you don’t get to take all the profit out?
DAD: No way. Your company needs extra money to invest in new products. Oh yeah. Say for emergencies and other expenses.
MAK: That makes sense. We’ll make more in the future if our company grows, right?
DAD: Absolutely. Your personal paycheck can pay for new toys or going to the movies. My paycheck goes towards our house utility bills, car payments, and some is used for fun. Keeping a personal budget helps you keep track of everything you have and allows you to save for things that you truly need now and in the future.
MAK: Okay, but you said we could invest in our company. I thought investing was for stocks and bonds.
DAD: Well, it is. But investing is when you spend money to make money.
GRANT: So if you invest in the stock market, you spend money on buying a stock because you think you’ll serve for more in the future at a profit.
DAD: Bingo. So if you spend money on supplies for your business, such as bingo’s bubble bath soap, you can use those supplies to make a profit by providing new or better services like a bubble bath. You can also invest in advertising, which will help you find new customers.
GRANT: Got it and since right now, we won’t know what supplies our customers will give us. I think we should focus on our advertising.
MAK: Agreed that should be our top priority. We should also take a look at our budget and decide how much we can afford to pay ourselves.
DAD: That sounds like a plan. How about we look at it together and make a plan for the future with an expectation that your company will grow? By the way, what’s The name of your business?
GRANT: Grant and MaKenna’s pet sitting services.
MAK: Dog walking with Mak and G.
GRANT: Friendly foods walking service.
MAK: The fantastic twin pet sitting.
DAD: Okay, I guess we still have a few things to work out. Mak and G have learned a ton about managing their money, but sometimes even they need a little help. When starting a business, it’s important to plan for the future. Saving money to invest in the future will help them ensure the long term health of their business. Now that they need to get a little overboard on the ice cream thing, spending way too much money when they may not have had it. And that’s what we need to do both in our business and in our own lives. Here are some things to consider. Running a company is like running a household, you have to put together your budget, no exceptions.
Next, identifying opportunities to save money or make additional money. Have an emergency fund set aside just in case and remain disciplined to stay on course. Next, saving money is sometimes the most overlooked step to help your budget be successful. Giving yourself a smaller paycheck will allow you to invest more of your profits into growing your business faster. Focus on the goals that are most important to you and try not to spend too much on the little things. And each potential savings situation is different. So consider all your options because money saved is money earned. You can also increase your profits by increasing your sales.
Additional services can increase revenues. So some opportunities that McAfee could look into are washing dogs or simply sitting when you can do those tasks like collecting mail and watering plants while the owners are in charge of it. Learning new skills is always a good one, like how to care for different kinds of pets that can open up new opportunities to make money. Or you can think creatively and consider what your customers really need or want and how you can provide a great experience for them. Thanks for being here for this season. We really appreciate you holding together with us along the way. And money with Mak and G. We’ll be back soon. Thanks and we’ll see you next season.