How Well do you Manage your Money as a Small Business Owner?

Entrepreneur is just another name for a multitasker. Once you get on board with your entrepreneurial ambitions, you are required to take care of multiple things at the same time- devising stellar strategies to attract clients, keeping your clients and employees satisfied and keeping track of your finances.

Businesswoman analyzing financial reports

Now, understanding your finances remains one of the crucial factors bolstering your chances of long term success as an entrepreneur. However, very unfortunately, small business owners find it very difficult to get a grip over their finances.

As per a study conducted by Intuit, around one in ten business owners surveyed admitted that the lack of financial literacy acts as a hindrance on their way to succeed. If you feel the same, then we would like to assure you that there are definite ways for small business owners to wriggle out of financial inconsistencies and that you are just required to be disciplined in your approach.

What is the total cost of running your business?

Sit down to have the exact estimate of your business costs. Your battle against poor financial management starts right from here. Know how much money you need to run your business. Think about your expenses:

  • Transportation
  • Taxes
  • Utilities
  • Salary
  • Rent
  • Insurance
  • Phone Bills
  • Campaigns
  • Internet
  • Debts

Now, one of the biggest mistakes that small business owners end up making while calculating their business expenses is that they unwittingly exclude the irregular costs. For instance, if you ever require a permit or license, you have to include them in the total business costs. These expenses tend to add up, especially when you start considering the costs like legal services, return on investment and your own salary.

What do your business debts say about you? Are you an escapist?

Manage your debts properly. Yes, it is very important to pay due attention to this part of your finances. Even the thought of too many business debts can end up dampening your entrepreneurial spirits in a major way. Don’t run away from them, instead, seek proper ways to deal with debts.

Running away
image credit: Sam Howzit / Flickr

If you really think that you are not able to manage your present debts on your own, you can turn to professional debt consolidation services after going through the reviews of several companies out there. Effective debt consolidation programs help you obtain a lower rate of interest on all your business debts combined. There is no dearth of companies offering debt consolidation services, but all of them will not really offer guaranteed satisfaction, so it is important to ensure that you are actually going through important reviews in order to zero in on a prudent choice.

Consider stepping up your technological know how

Yes, embracing technology at every level of your entrepreneurial operations will only facilitate business efficiency and it is definitely worth the costs. You can make use of financial management apps, online banking facilities and cloud based storage functionalities in a bid to shore up results for your business- simply because you can work from anywhere and everywhere with the help of these tools.