Shoestring Budget Definition
Shoestring refers to a project or task that is attempted with a small capital which is insufficient for the proposed capacity of the project. Shoestring is a term often used in budgeting. A shoestring budget refers to a budget with a little capital, a budget with an extremely small funding and inadequate capital. A company that financed a project on a shoestring budget run the project on an extremely low capital which is adequate for the scope of the project.
A Little More on What does on a Shoestring Mean
‘Shoestring’ originated from The Century Magazine which was issued in 1882. According to the Oxford nglish Dictionary, the origin of the term ‘shoestring’ can be traced to the issue of this magazine. The term was further linked to the early peddlers who had a small amount of money for their trade. These peddlers sold items like shoelaces, needles, thread, pots, spoons and other items which were funded with an extremely low capital.
Merriam-Webster further disclosed the usage of ‘shoestring’ as an adjective in 1859. It is a situation whereby a business or project is being run on a stringent budget. “Bootstrapping” differs from a shoestring, it refers to individuals lining or working without any shoestring budgets but only use the available resources.
What Constitutes a Shoestring Budget?
Oftentimes, a shoestring budget is a budget that is extremely little and insufficient for the underlying project. However, there is a notion that if a shoestring budget is stretched, the fund budgeted might just be enough for the project. A shoestring budget is likened to a shoelace that when stretched, is enough to keep a pair of shoe fitted, if the shoelace is not enough to keep the hoes close after being stretched, some parts will be left open.
The shoestring budget believes that money must be stretched to achieve the maximum results when doing a project. Also, ‘additional funding’ is a term far-fetched from shoestring budget.
Here are some things to know about shoestring or shoestring budget;
- Shoestring refers to an extremely little amount that is insufficient for the intended project or task.
- This term has its origin in the The Century Magazine, which was published in 1882.
- Shoestring budget is a budget with little funding.
- There is little or no access to additional funding by individuals or businesses with shoestring budget.
Real World Example
The United States Department of Agriculture (USDA) stated in 2018 that is the minimum amount that a family of four is expected to spend on groceries every week is $148. According to USDA, this budget is under the ‘thrifty plan’ otherwise called limited food budget for families. This is otherwise a shoestring budget.