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Invest In Your Business

Short Term Sacrifices For Long Term Gains

Capital Preservation Services recommends you begin marketing on a larger scale. The new entity that will enhance your commitment to more and better marketing and promotion of your business will obviously need funding. This additional funding will increase your marketing expenses and will many times have a short term negative impact on cash flow. This will be a short term and expected stage in your business model.

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“Companies spent an average of 10.2% of their annual 2014 revenue on overall marketing, with 50% of companies planning to increase [in 2015] to an average of 10.4%.”

- 2014 Gartner Research Study

Calculating Your Marketing Budget

Applying A Multifaceted Approach

Obviously 10% is not a magic number but does seem to be a benchmark.

Your budget will be subject to varying factors. Examples of these factors include your business being either in its growth stage vs a well-established brand. Other factors may include introducing a new product or service. This would warrant more dollars being needed over a specific period.

Many of our clients have been spending 1% – 3% on marketing. This number will not be adequate for growth. Remember marketing dollars are not to be viewed as an expense but and investment in your business. Your growth goals will proportionately assist in determining your actual marketing budget.

The SBA recommends a budget of 7.8% – 8.4% of revenue of your net profits range between 10% – 12%. As you begin your enhanced marketing, these will be minimum numbers to begin your budgeting process. We will review on an annual basis your marketing budget, as well as, the results.

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