5 Financial Mistakes most Entrepreneurs do!
Fincorp Tax Advisory
Last Update 3 năm trước
What is a Financial Goal? An outcome that you wish to achieve with your company's finances resulting in not only a positive financial statement but also a strong and constant growing Balance Sheet
1. Not setting-up Financial Goals
It's wisely said that dream big, and act small. So when you plan to build a million dollar business, make sure you draw a path that navigates you to reach your goal not just strategically but financially as well and in order to achieve that, make sure you clearly define the value proposition to your customers, employees and primarily to yourself.
2. Spending too much on Fixed expenses
Any kind of asset, or service that a business undertakes in a hope that you will have good business in future and it will help at that time and could have been avoided, makes a company bound to burn more cash rapidly and having less cash for working capital and ultimately either ending up borrowing debts or shutting down their business.
3. Tracking your Expenses & Income.
Most entrepreneurs keeps a track of the income that they are going to generate, and not track and analyze the types of expenses being made in business which could help eliminating non value addition expenses vs value addition expenses and increasing your profit margin and price optimizing as well.
4. Cash Flow Management
A lot of traditional format business that worked on credit period with customers have suffered major loss or had to shut down due to lack of enough cash in working capital to keep the business running. Modern businesses have realized the importance of positive cash flow to keep the business growth constant either working on pre-payment terms or short and strict credit periods to be able to meet their expenses easily.
5. Not paying themselves.
A lot of Business owners feel, that it's not important for them to take money from their business and will take it later. This gives an illusion to most of the business owners that their business is highly profitable without realizing the implicit costs and continue to work on the same Business/Revenue model.