Most small business owners we speak to ask the same question: “How much should I be spending on marketing?”
It’s a fair concern. Every pound matters, and no one wants to throw money into a black hole. The truth? There’s no magic number, but there is a proven rule of thumb that makes budgeting far simpler.
The Rule of Thumb
The general guidance is 5–10% of your annual turnover.
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Closer to 5% if your business is well established and just maintaining.
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Closer to 10% if you’re new, rebranding, or chasing growth.
Example budgets:
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£250k turnover → £12.5k–£25k per year on marketing.
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£500k turnover → £25k–£50k per year on marketing.
Think of it this way: rent pays for your space, staff wages keep things moving, and marketing buys your future customers.
Why Underspending Hurts
Cut corners, and you’ll likely face:
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A dry sales pipeline — fewer enquiries, fewer leads.
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Lost visibility — competitors dominate search and social.
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Inconsistent results — campaigns stop-start, no momentum.
Invest properly, and you’re building a system that keeps enquiries coming in without the panic.
Where Should the Money Go?
A sensible small business marketing budget usually covers:
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Website & SEO – making sure people find you online.
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Paid Ads – Google Ads or Meta campaigns aimed at your customers.
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Content – blogs, graphics, videos that show you’re the expert.
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Email & CRM – keeping in touch with leads and loyal customers.
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Branding & Design – a professional look that builds trust.
The trick is balance. Don’t blow the whole pot on ads, but don’t waste six months posting on social with no plan either.
How to Decide Your Budget
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Know your goals: Do you want steady leads, or do you need growth now?
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Work out customer value: If one client is worth £2,000, spending £500 to get them isn’t wasteful — it’s smart.
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Stay realistic: You won’t outrank national brands on a shoestring. Aim where you can compete.
Quick Wins (You Can Do This Week)
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Check if you’re spending anything consistently on marketing — even £200/month is better than nothing.
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Review your website: is there a clear “Contact” or “Book Now” button on every page?
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Set up Google Business Profile properly — it’s free, and it drives local calls.
Frequently asked questions
Most UK SMEs spend between 5–10% of annual turnover. Newer or growing businesses lean closer to 10%.
Yes, marketing expenses are classed as allowable business expenses in the UK. That means it reduces your taxable profit.
It depends on your goals. Ads are quick wins (leads this week), SEO is the long game (visibility every month). The best results come from a mix of both.
What's Next?
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