How To Create A Marketing Budget For Your Business

1: Determine your marketing objectives: Before you create a marketing budget, you need to determine your marketing objectives. These objectives could include increasing sales, expanding market share, launching new products, or building brand awareness. Your objectives will help guide the allocation of your marketing budget.

2: Calculate a percentage of revenue for marketing: A common method for determining a marketing budget is to allocate a percentage of your revenue to marketing. According to the U.S. Small Business Administration, a company with under $5 million in revenue should allocate 7-8% of its revenue to marketing. For larger companies like your $60 million revenue food service company, a marketing budget of 5-7% of revenue is appropriate.

3: Review past marketing spend: It is helpful to review past marketing spend to determine what worked well and what did not. Reviewing past campaigns and expenditures can help guide your future marketing investments. Additionally, consider the industry benchmark and average marketing spend for companies similar in size and industry.

4: Allocate budget by marketing channel: Once you have determined your marketing budget, it is time to allocate it to specific marketing channels. For example, your company might allocate a certain percentage of the budget to digital advertising, social media, email marketing, events, and print advertising. The allocation should be based on what has worked well for your company in the past and where your target audience is.

5: Track and adjust the budget: Finally, it is important to track your marketing spend and adjust your budget as needed. Keep an eye on the results of your marketing campaigns and adjust your marketing investments accordingly.

Based on the method of allocating 5-7% of revenue for marketing, your company's yearly marketing budget should be between $3,000,000 and $4,200,000. However, this is just a starting point, and your actual marketing budget may vary based on your specific marketing objectives and past marketing performance.