Business Costs

Business Startup Advice: 3 Tips to Avoid Common Financial Mistakes

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4 common financial mistakes business owners make

If you are a new entrepreneur, just starting your new venture, listen up in order to avoid common financial mistakes. According to the Small Business Administration, about two-thirds of businesses with employees survive at least 2 years and about half survive at least 5 years. As one would expect, after the first few relatively volatile years, survival rates flatten out. A high percentage of entrepreneurs will experience failure within the first year of their business because they do not have enough cash.  (Source: Bureau of Labor Statistics, Business Employment Dynamics.)

So what do you need to know to survive?

For starters, it’s imperative that you grab a strong hold on your financial situation, in order to avoid common financial mistakes. When you have a tight grip on your finances, you will be able to avoid some of the mistakes that many entrepreneurs make. When you have proper knowledge of your finances, you will have an easier time getting your start-up off the ground.

1.  Plan Ahead!

You want to make sure that you are able to plan ahead for any unforeseen disasters. We know that you cannot see into the future, but when you plan ahead, you will be prepared for anything. When you are prepared for emergencies, you will save yourself from frustrations and headaches in the future.

2.  Budget, Budget, Budget!

Aside from making plans, you need to make sure your budget is part of your financial plan’s foundation. Your budget will give you the ability to keep track of the amount of cash you have, your current expenses, and the revenue that you need to grow your company. Your budget will also give you the opportunity to meet all of your business goals. We encourage you to make updates to your budget on a regular basis.

3.  Finance 101: Brush Up On Your Skills

One of the skills you should have as an entrepreneur is financial literacy. You have to know your financial position in order to make the right decisions. Gain an understanding of your finances and find a way to organize your finances and your documents. Are you ready to make smart decisions so you can make waves in your industry?

Remember, running a business successfully does not need to be complicated. Keep it simple!

Business owners, check out ways I can help you find hidden profit and improve cash flow at www.portalcfo.com.

Get Cost Savings on Cell Phone Bills

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You rely on your smartphone to keep in touch with your office when you go out on calls to customers. But your cellular service is easily costing you $110 or more per month. In addition, you’re paying for the phones for each member of your sales team. So the fee is proving a major drain on your limited budget.

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Grow Your Business: Stop Spending On What You Don’t Need!

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stop spending

Stop spending! There is little more disappointing than seeing a great business idea in the hands of an enthusiastic entrepreneur tank because of overspending. There are many things that would be great for your business if they were free, but spending money that does not translate into revenue can hurt your chances of success and instead drain your precious resources. Here are a few things that most small businesses that are gaining traction really don’t need and too many have:

  • Fancy gadgets and technology. Question the efficiency that these things promise. Often times, they only increase efficiency measurably in the hands of large corporations, and they certainly cost a pretty penny! Invest your resources in more relevant areas before putting them into these, as appealing as they may be!
  • Too many full-time employees. Keep your employees to a minimum and try to keep your labor costs variable instead of fixed. Most often, it is the person running a business who is the most qualified and motivated to sell its products, especially in the early stages. Look to more salespeople and admin staff only when the business is growing too large for any other option; not because you think it would be useful.
  • A high-end website. Unless you depend on eCommerce as your primary source of revenue, a simple yet professional website is all you need. Wait until the rest of your business has grown to roll out the fancy “Version 2.0.”
  • Too many new products and services. Stick to the solid base you have set up and expand this base before investing in something new. Simplicity is key when building a business and too many new products will leave no room for depth or authentic development.

Simply dropping some of these things and redirecting your resources can be a great way to grow your business. As contradictory as it may seem, many of the things above actually create stress rather than relieve it. When the appropriate time comes for using these things, you will know!

Remember, running a business successfully does not need to be complicated.  Keep it simple!

Business owners, check out ways I can help you build a clear path to achieve financial freedom at www.portalcfo.com.

How much office rent should I pay?

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office rent

How much office rent should I pay?  This question has been asked repeatedly over the years by my clients.  Here are four lessons that were taught to me by mentors and teachers in corporate banking and business.

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How to Cut Costs at the Bank from NerdWallet

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Today’s guest blog post is from John Gower from NerdWallet  www.nerdwallet.com

Cut Costs at the Bank

There are a multitude of areas in which a business owner might choose to trim expenses, but one that is often overlooked is the cost of day-to-day banking transactions. You may have had the unlucky experience of incurring bank fees in your personal finances, and the same concern applies to businesses. That’s why shopping around is critical to finding the best bank account for your small business needs.

Maybe your new business needs a financial institution to meet its banking needs. Or perhaps your established business is coughing up large sums in bank fees and service charges with regularity. In either case, it may be time to look for a new business checking account.

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4 Easy Ways to Cut Business Costs

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cut business costs

As a business owner, you’re probably wondering about ways to cut business costs. It takes time to build profitable revenue streams and carve your niche in your industry. Therefore, you’ll need to be as profitable as possible in order to help your business grow.

Let’s take a look at four easy ways to cut business costs. These methods will give you some ideas on how you can help your business move forward through smart financial planning.

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Financial problems: How to avoid them in your small business

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financial problems

How can a business owner avoid financial problems? One of my favorite financial concepts is “rationalizing” a business. By definition, from our friends at Merriam-Webster, rationalize means: to apply the principles of scientific management to (as an industry or its operations) for a desired result (as increased efficiency).  Rationalization of a business’s operations is a simple concept. However, in my opinion, it’s not easy to implement because of ego.

Entrepreneurs work very diligently to grow their businesses by adding talented staff along with non-staff overhead (nicer office, computers, the list goes on, etc.). If a rapid growth strategy is not executed with a laser-like focus on financial metrics, here is the all-too-familiar scenario that unfolds: the anticipated revenues do not materialize and the business is unable to support the increase in staff and overhead.  That is also known as financial problems!

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How to Reduce Labor Costs in Business: 5 Cost Cutting Options You Should Explore

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reduce labor costs

When thinking about how to reduce labor costs as a business owner, there are options that you can explore, without having to reduce your staff. Like other areas of managing expenses, reducing the costs of labor associated with running your business is all about finding where fat can be trimmed, without making drastic changes that could negatively impact your company.

So, what can you do?

That’s a question we’ll explore in this post as we talk about how to reduce labor costs while keeping your operations intact as much as possible, so keep reading to learn more.

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Building a Company Pricing Strategy: How to Determine What You Should Charge

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company pricing strategy

Like any other business, you’ll eventually need a company pricing strategy. It’s an important part of the puzzle, so you want to make absolutely certain you get it right.  Many different factors go into figuring out just how much you should charge for your products and services and we’ll explore some of those things here.

Keep reading to learn more about developing a company pricing strategy that will work for your business, because many of your other business practices will depend on it.

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Deductible Business Expenses: What Your Business Can Save On

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What do you know about deductible business expenses? When you run your own business, money is one of the top priorities. This goes for what you bring in as well as what you spend. Therefore, you want to do everything in your power to keep costs low, so that they don’t eat into profits. We’ll explore how to do just that through deductible business expenses. Keep reading to learn about how some of your routine business practices can save you money.

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Manny Skivoflax LinkedIn