You may know that it is important to manage your money so that you can be in a good financial position, but do you know how to do just that?
The first thing you can and should do is to eliminate impulse purchases. Include rules or processes in your operation to force you to consider or comply before all purchases. Exercise the basic principal of “do not buy anything if you don’t really need or can’t afford.” On the other hand, be sure that you don’t skim yourself on professional services. Regardless of the costs involved, it always pays off at the end to seek out professional advice when you need it.
Concentrate on the core of your business and the basic necessities. Before spending your money, consider whether it helps your business and aligns with your business goals.
Uncover and prevent potential financial problems by figuring out your return on your investment as well as the turnover on your receivables and inventory. Increase your cash flow by doing everything possible to keep both your receivable accounts and inventory low.
Increase your borrowing power by building a credit rating with your local bank. Every three months, borrow $100 to $1,000 from your banks, place it in an interest bearing account and then pay it all back at least a month or so before it's due. This business leveraging exercise will strengthen your ability to obtain needed financing on short notice.
Join and learn from your industry's local and national trade associations. Take advantage of all the free services offered by your bank, local library and government agencies. The insights you gain will definitely help equip and position your business positively.