After all you’ve put yourself through to start your business, the last thing you want to do is lose it because you can’t cover the expenses!
Even with great profits coming in from the business, as the owner, you need to make sure you have more than enough cash flow to keep the business open and operating smoothly. What I find to be an issue is that owners aren’t making time to plan for business nor are they making time to review how the business is doing financially until they need to make a purchase that will help grow the business and by that time, it’s too late. Business starts to run behind the current effective methods, customers become unhappy, you lose out on money, and eventually shutdown is inevitable. Let’s not get started on having to return to a 9-5 or hear the ridicule that comes from the mouths of those that wanted you to fail all along.
You can avoid this tragic loss by making your business a daily, weekly, monthly, and quarterly priority for yearly success with 6 Quick Tips to Help Your Business Stay Afloat:
- Be sure to set up a system where you review receivables and payables (including payroll) on a weekly and monthly basis. How will you know what else you can do to improve business if you don’t know what you’re bringing in and what’s going out.
- Review your bank statements monthly. You need to compare your records with your bank statement to make sure that you have recorded the proper amounts, are aware of what AR’s or AP’s are still outstanding, are clear on the amounts being deposited, know exactly what you’re spending the most money on, and of course know where you can use room for improvement in spending.
- Plan your expenses out before you spend. Most expenses for your business are essentials and aren’t options. Therefore you know what amount is absolutely needed on a monthly, weekly, and daily basis without question. Once you’re aware of this amount, you can see what you have left over and can spend according to your business plans and needs.
- Plan your spending. When you know just how much is left over after your essential expenses, you can make business purchases and improvements according to your timeline to keep business running smoothly and open!
- Yes! You need a budget! If you make a purchase that isn’t suitable for your business at the moment, then you need to know how much to put away to save for that purchase OR find other options that work within your budget. Making a purchase that you can’t afford right now puts you in jeopardy of not being able to afford your essential expenses that keep the business running.
- Think ahead! For the most part, if what you’re doing right now has afforded you a certain amount of earned income, you can approximate that you’ll continue to make that amount. Is it enough? Does it cover everything? Is there room to grow your business with that amount? If so, within what timeframe? What will you need to do to bring in more money and how soon can you do it? A simple estimation can help you answer these questions and give you a clear picture of what needs to be done to maintain where you are now and how much harder and smarter you’ll have to work to get where you’re going.
It’s easy to get excited about bringing money in but a business is just like a marriage and you’ll not only need to start off on a good note but you’ll need to work at keeping a song in your heart that sings a melody of longevity. Likewise, the same way we have resources to help improve your marriage, I am your resource to help you improve your business. Call me at 713-487-6198 or email me at firstname.lastname@example.org to schedule your checkup!