Are you wondering how much to spend on advertising? There are several popular theories around. One says about 5 to 10% of gross sales. Another says that recommendation is flawed because it doesn't account for your markup and rent costs. 

Then there's the real world where you figured out a budget using one of those formulas years ago (or maybe just made it up), but are now in the rut of just using last year's budget as a guide. Sound familiar? 

If so, it's time to evaluate your ad budget based on a few more relevant factors including:

• What's going on in your community? Is it growing or shrinking. Any planned construction projects that will affect traffic and ease of accessing your business. 
• What's going on competition wise? Are there any new shopping areas opening?  Are any direct or indirect competitors opening stores?
• What's going on inside your business? Do you have any new products or services being launched? Are there any major changes in your operations that will impact your customers? 
• What's going on in your economy?  Are employers hiring or cutting back? How are consumer confidence and outlook?
• What seasonal impacts will affect sales throughout the year? Should your budget vary month to month to meet these variations, or would you be better served by a consistent campaign all year long?
• Where do you want your sales to be? If you want to grow your business, you need to grow your marketing efforts accordingly. Increasing your advertising budget is one effective way to get there, assuming you use that money effectively to reach the right audience with the right message.