For your business to continue to exist and for operations to continue running, you will need finance. The importance of finance can therefore not be overemphasized in business. Here are some tips to enable you efficiently manage your business finance.
- Don’t just spend, Plan:
Do not just spend without having a basis for your spending. As a small business, you need to be strategic with every penny you spend. You need to have a budget you work with. If you later on get investment for your business, you need to know how much to spend to recoup such investment. You also need to know how much you need to spend daily to keep necessary operations running.
- Don’t Spend, Invest:
The more money an Entrepreneur gets, the more money they spend. As a small or medium scale business owner, you need to cut your cloth according to your size. Do not go for unnecessary luxuries that will not plough money back into the business. You should learn to work with a minimum viable product especially if you are not so big on a budget. A large proportion of the profit you make should be reinvested in activities that would generate more cash-flow for your business.
- Maintain Records
You should also ensure you always keep records of all your transactions up to the lowest petty ones among them. All your receipts, invoices should be kept. They can all be useful for you later on when you are trying to reconcile your statements, seeking investment or planning for the future. They should be kept organized.
- Don’t be greedy
As a business owner, you have the power to determine how much you want as a pay, you need to have your business milestones in check while making such decisions. You should be moderate and set a figure that wouldn’t hurt the business to pay.
- Spread your wings
Do not just rely on a small number of customers, you need to acquire more customers as possible. Anyone can become insolvent anytime, if your only customers go bankrupt or your competitor wins their hearts, you are really going to harm your cash inflow.
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