Are You Ready to Start Up a Business?

Having a business idea and starting it up is not everything you have to know about the business. There are things that you must be well prepared for. Truth is it doesn’t start and end in the grand opening. Here are some simple things that you have to realize before starting up a business. In fact, these are so simple that even young entrepreneurs miss it. However, knowing these simple and practical things can help you cut a huge portion of your business’ expenses. These things will also determine whether you are truly ready of starting up your own business.

1. Extra Cash.  It’s very important to have extra money in the bank for business alone. Most successful businesses are the ones that was carefully thought of and funded. Getting loans in the early stage of business is not advisable. You have to remember that the whole point of having a business is to have financial freedom in the future, not to put yourself into debts. 

For example, if you are thinking of putting up a restaurant, do you think you have enough cash to keep the business running for at least six months without depending on the gross income? You should know that the first six months is the hardest. You cannot even expect the business to sustain its own for the first couple of months. It’s very important that you have an extra cash in the bank to fund your own business. During the first quarter, you should expect to sustain the business and not the other way around. You cannot expect the new business to shoulder your personal expenses. This is also one reason why I don’t encourage people to leave their regular job or other sources of income when putting up a business. 

It will also be best if you have a separate credit card and savings account for the venture. Never use your personal credit cards. Applying for a new card with the lowest annual fee for your business is the best thing to do. There has to be a clear line between your business and personal expenses so never ever mix the two. 

2. Learning Inventory. This is one thing that you shouldn’t depend on others. You should focus on the cash flow of your business. From expenses to revenues (gross and net), debts and dues, to your taxes. Having a bookkeeper is a good thing but you have to realize that as a business owner, you have to know all the roles of your staff and be capable to perform them on your own. I don’t really advise weekly inventory. It’s best that you do it on a daily basis.

3. Formal Writing.  Aside from business letters, you also have to learn how to read and write legal indentures. This is one of my areas of improvement as well. I used to have a lawyer whom I can always count on when it comes to legal matters so I didn’t have to worry about it. But now that I am being independent, I’m still trying to learn how to write and understand contracts on my own. It’s good to seek for legal advice for legal papers but it is important that you at least have an idea. When I learn how to write an effective business letters, I saved a huge chunk of money that I used to pay to my virtual assistant. It may not be easy at first but once mastered, it will save you a lot of money which you can use for other areas of the business. -M.D.

We’d also love to hear from you. Feel free to comment below to share your business experience. You may also email us at mybusinessgrowsbigger@gmail.com for free business consultation. You may also follow us on twitter https://twitter.com/BusinessSavvy2