Last Updated: January 9, 2024 • Visit Blog Homepage

Starting and running a successful dog daycare and kennel requires a significant amount of time, effort, and money. Financial planning plays a crucial role in the success of any business, and a dog daycare is no exception. The key to success is setting achievable financial goals and having a well-thought-out plan to achieve them. In this article, I'm going to discuss the importance of financial planning for dog daycares and provide some tips to help you set and achieve financial goals.

Why is Financial Planning Important for Dog Daycares?

Financial planning is important for dog daycares because it helps owners understand their financial situation and make informed decisions. It provides a roadmap for business success and helps owners understand how much money they need to operate, how much they can afford to spend, and what they need to do to reach their goals. Without a solid road map, it can be hard to estimate where your finances will be in the coming weeks, months or years. By doing some financial planning, you can better understand where your money is going to be spent.

Statistics show that businesses with a well-defined financial plan are more likely to succeed than those without one. According to a study by the Small Business Administration (SBA), 30% of small businesses fail in the first year, and 50% fail within the first five years. However, businesses with a comprehensive financial plan have a higher success rate, with only 17% of these businesses failing in the first year and only 30% failing within the first five years. Why do businesses that have financial plans fail less? It's because they're better prepared for the uncertainty that comes with running a dog daycare or boarding business.

Tips for Setting and Achieving Financial Goals

Set SMART Goals

The first step in financial planning is to set SMART goals. SMART stands for Specific, Measurable, Achievable, Relevant, and Time-bound. Your goals should be specific, measurable, achievable, relevant to your business, and have a set deadline. For example, a SMART goal for a dog daycare might be "to increase revenue by 10% in the next six months by increasing the number of dogs enrolled in daycare services." If your goals are too hard to define, it's impossible to know if what you're doing is actually helping you achieve these goals. If you just set "Make more money" as your goal, but you don't put an end date or a percentage, it isn't going to be as effective.

Create a Budget

Once you have set your goals, the next step is to create a budget. A budget will help you understand how much money you need to operate, what your expenses are, and how much money you have to work with. It will also help you determine how much money you need to achieve your financial goals. Most small businesses don't set up a budget, and that's a huge mistake. Budgets are necessary for any business, especially small businesses. They help you visualize where you're spending and what for. When you start your business, you might think that you NEED a landline. However, after a couple months, you realize through your budget that your landline is costing too much and never getting used. Thanks to your budget, you now know to cut it out.

Monitor Cash Flow

Cash flow is the movement of money in and out of your business. It's important to monitor your cash flow because it helps you understand how much money you have available to invest in your business and how much money you need to keep your business running smoothly. As a dog daycare and boarding facility, you're going to have different streams of revenue. If you have recurring daycare appointments, you'll be able to forecast your future earnings pretty easily. Forecasting boarding income is a bit harder because you can never be sure how many appointments will come in last minute. Regardless, monitoring your cash flow is essential.

Track Expenses

Tracking expenses is essential for financial planning. It helps you understand where your money is going and how much you are spending on various business activities. This information can then be used to make informed decisions about where to allocate your resources. This goes back to the previous example about having a landline. By tracking your expenses and then going over those expenses every month, you can get a better idea of where you're spending (or hemorrhaging) money. Sometimes small businesses don't realize that they're spending too much on a certain thing because they never keep track of how much they are spending on that certain thing.

Seek Professional Advice

Finally, it's important to seek professional advice. A financial planner or accountant can provide valuable advice and help you make informed decisions about your finances. They can help you create a budget, monitor your cash flow, and track your expenses. You only know as much as you know, and you don't know what you don't know. That's why it's always a good idea to consult a professional. They can take a look at your books and help you figure out where you are doing well and where you're not doing so well. Paying for a professional will pay for itself, trust me!

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