Make your money your business. Even nowadays many budding entrepreneurs are reluctant to face the music when it comes to their finances. However, to run a profitable startup means successfully managing all the expenses, the revenues, the tax returns and other records. Needless to say, all of these tasks sound tedious and definitely are, but if you strive to make it big, you need to make the money you earn your business. Therefore, here are eight simple rules to keep your startup finances in order:
Start off smart
Start smart by choosing the way you would like your startup company to operate. Depending on the company you run, think about whether operating as a solopreneur or as a partner is more profitable regarding tax or liability protection. Some startups are launched as a limited liability company (LLC). The perk of having a partner corporation in case of debt is that the owner of a startup cannot be held personally liable. On the other hand, if you have a plan for the startup to develop into a publicly traded company, this option is probably not the best one.
Business vs. private
As you separate your business from your private life, consider doing the same with your business and private bank account. Although we might think that having just one account means less trouble, it can also mean more mistakes that can cost you an arm and a leg. Therefore, it is definitely wise to consider another business bank account and a new credit card, too. The troublesome task of tracking payments and transactions will get a whole lot easier with a separate bank account. In the long run, making your budget won’t give you a headache anymore.
Work out your budget
The key to a profitable startup lies in carefully planning and working out your budget. Naturally, it is impossible to plan out your budget in details, but working it out should give you a better insight into your revenues or ways to cut expenses. Remember you want your work to pay off.
A clear budget plan will help you set a competitive price for the company’s goods or services. In addition, your savings for the necessary business equipment will be easier to manage as well.
Bring home the bacon
As previously mentioned, the budget helps regarding pricing your products and services. As to raise the revenue by giving your customer the best client-friendly service, give a thought to simplifying the payment procedure. For example, in case you are selling homemade beauty products enable your customer to purchase the goods, not only by cash but also by using a credit card. Especially now, with the e-commerce flourishing, there are many companies providing their financial services and mobile payment services that could come in handy for bringing more income.
High tech saves you a dime
As a serious businesswoman (or businessman) investing in an online accounting software can later save you a dime. With the endless choice on the internet, find the one that will suit the needs of your business. There are many online tools to choose from, so get enough information before coming to a decision. If by any chance your financial data is still stored on your PC, consider opting for cloud-based tools for small business and moving there all your data. Thus, you will enable a flexible and practical insight into the company’s ongoing financial state.
Balance the books
Along with using some online accounting software, why not consider hiring a professional, too? Knowing that you are in safe hands will give you some time to focus your attention on the startup’s progress and its development. By consulting a professional, you can get some valuable information about financial topics such as tax return and accounting solutions. Moreover, a professional can give you some advice about common pitfalls that small businesses usually come across and share some practical ways to avoid them.
A penny saved is a penny earned
Making money is one thing, but saving on expenses is another. In order to make ends meet, as a budding leader of a startup, you should be prepared and aware of the budget at any time. The skill you will need to learn is to plan your expenses ahead. In other words, settling your bills on time spares your business from tons of trouble like extra charges or paying interest rates. Thus, by saving money, you are earning money as well. Tax responsibilities are never done, so make sure to invoice everything, too.
A little push by credit unions
In the end, maybe what your startup needs is just a little push in form of a financial support. Unfortunately, many banks are unwilling to give a loan to an ambitious entrepreneur due to recent economic turmoil in the world. For this reason, every intelligent startup leader is seeking assistance from local credit unions. They offer loans at competitive rates and this is crucial for businesses that are just taking off. In addition, this is a win-win situation for both partners. While you are offering your company’s service, the union is providing you with lower fees and charges.
Make your money your business no matter how big or small it is in the beginning. When balancing the books, every penny counts. Having a clear idea of the budget as to plan future investments and expenses is a golden talent for a newbie. Make the most out of the affordable online tools. Hopefully, with all these simple rules and ways to handling the most challenging part of a startup, your finances should be in order and your money worries behind you.