The Budget Battle: An Independent Company's Approach To CapEx
As an independent company, we spend what we make and keep a watchful eye on our P&L and cash position. Wants are plenty—on any given day, we could find no less than 20 things we’d like to update in each department. Add all those up and we’d run up a tab we couldn't possibly pay. This seems to be the case no matter how much we grow, our appetite is always bigger than our stomach.
Instead of allocating a paltry amount of money to each department for CapEx, we have a quarterly allocation of a larger lump sum shared company-wide. If the retail department uses $10K for something, that's $10K that the marketing, roastery, or partner program departments don’t have access to.
This shared budget approach means every large CapEx allocation involves a discussion with our leadership team to decide where the money will go. The ongoing dialogue about the health and needs of each department drives interdepartmental cooperation, fosters ownership, and connects each department's actions to the bigger picture better than a siloed culture of “I have to protect my money and spend my full budget or I won't get it next year.”
Our departments aren't in competition with each other. We’re not playing a zero-sum game. The goal of any expenditure is to drive our mission forward. If the money gets allocated to the highest-level organizational need, everyone wins.