Beware of little expenses. A small leak will sink a great ship.” -Benjamin Franklin
Financing is a major issue in business. Keep your finances simple. It is completely possible these days to keep most startups under $1000 ( $100 Startup by
There is nothing that will stress you and your business out more than fear of bankruptcy, or fear of not making a profit. Did you go to the effort of starting a business just to be financially behind? Of course not. But entrepreneur who plan badly for the financial part of their business, often wind up in a financial pickle. To avoid a financial catastrophe, here are three pointers on how you can keep your business finances manageable and in the positive side of the balance sheets.
Figure out your basic costs.
How much do you need to get your business started or to continue running your business. Don’t be greedy but be realistic.
There are basic costs such as:
- Business cards
- Office space (This depends on the kind of business you want. Most businesses, these days, do not need a physical office. If you are just starting out and you offer a product, then try making space in your home. When you are successful you can then spend the money on acquiring an office space).
- Product costs (producing and launching)
- Taxes (set money aside as you go rather than waiting until the end).
- Licensing/Permit fees
- Credit card/transaction fees
- Your time
Try to make the most out of what you have. You don’t need to buy brand new items just because you are starting a business. For instance, don’t buy a new laptop if you already have a perfectly functional one. Spending money now on things you do not need will ensure that you do not make a profit, cannot buy the expanding basic needs of your business as it grows.
But remember that sometimes you do need to spend money now on things that will help you grow later. The basic needs of your business will depend on the kind of business you want. If you are offering a coaching service, then getting a coach for yourself is a necessity. Don’t skimp out on this or you will kick yourself later.
If you need to acquire the services of others, shop around. Don’t just pick the first company/freelancer you stumble upon because you’re nervous or in a rush. Shop around. There are items and services that you will need to pay more money for to make sure you have a better quality but there are others were going on the cheaper route is ok. I was willing to pay a higher price for my logo because that is what would represent my business to others. But when it came to buying my website name, I looked at the company that offered me the best but cheapest price (in this case, it was GoDaddy.com). Find out who meets your needs financially AND value wise. Remember not to be so focused on finding the cheapest service that you compromise your value or the value of your product.
What is it going to help you start making money right away?
The types of people who tend to start businesses are usually filled with ideas. That is both a gift and a curse (tribute to Monk). Yes, you have a ton of ideas for products and services you can offer. But your focus should be on first gaining a profit before following through with other ventures. This is a weakness of mine. Ideas are constantly emerging and floating around in my brain. And I want to start making those ideas into a reality immediately. Unfortunately, whenever I attempt to do this, my business stops progressing.
I usually have to take the following steps to decide what I can do to start making money as soon as possible:
Go back to my business plan and brainstorm
Prioritized the ideas that come from brainstorming
Execute the itmes that can give me immediate capital
Usually, as soon as I have followed through with the ideas that provide me with the best immediate capital, my ability to follow other ventures becomes much easier and manageable. Figure out how you can increase your value or the value of your product to your customers. Then follow through with any applicable idea that is generated from your brainstorming session.
Being an entrepreneur is an amazing calling. Having passion, perseverance, drive, and a desire to help others will get you far in business. You don’t want to fail because you failed to plan your financial goal.
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