The Strategy Team should include a proposed marketing budget in the Plan, the Marketing Budget Worksheet Template can be used as a guide. MP1070-2 MARKETING BUDGET TEMPLATE covers advertising, sales promotion, sales force, marketing research, and more. Because marketing needs and costs vary widely, there are no simple rules for determining what one organization’s marketing budget should be.
A popular method with small businesses is allocating a percentage of gross sales for the most recent year; this often amounts to between five and ten percent for an existing business. However, if the company is planning to launch a new product or service, it may want to increase its marketing budget to ten percent (or greater) of expected gross sales. Another method small businesses use is analyzing and estimating competitors’ budgets and matching or exceeding them. The Strategy Team should review the previous year’s Marketing Plan and determine, in light of the previous year’s budget, if marketing funds should be allocated differently.