You may be new in the area of handling a business that has a huge capability of booming into a big one that will bring you great profits one day. But before you get to that, you have to be aware of the five of the essential things that an entrepreneur must know when it comes to handling their finances in leading a start-up.
1. Trim Your Costs
Since it is still the beginning of your business, you do not really need to have all the fancy equipment, workspace, and be on expensive business trips all at once. Do not do and buy everything you can afford for now. All the unnecessary costs must be cut. This stage of your business venture is not the time to b extravagant, but the time to be frugal and practical.
Before you even touch one thing, be sure to purchase it knowing that it will return an investment to your company. If there is a relation between buying or spending and increase in profits, then the purchase will be worth it. If there is none, an affordable alternative should be searched or do without it.
The emphasis on this first point is to not invest money on things too quickly, especially if they are not imperative for your business. Be effective and efficient in the stage that you are in, and you will grow even more as you take each stage of your business one step at a time.
2. Do Not Let Your Accounting Works Pile Up
Some businesses put off dealing with their bookkeeping and accounting works. Do not be one of them.
If you think about it, when you set aside arranging and taking care of your accounting works, it will stay where you leave them until they all pile up, making it more difficult to handle. So, for your own benefit and the rest of your business, might as well face the numbers before they turn into a bigger mess that needs to be sorted out.
Breaking down accounting items into small categories can actually help. When you categorize them by expenses, paying employees, sending invoices, you will find it more achievable in terms of finishing them on time.
3. Consider Carefully a Credit Card Payment Option
There are believed to be a few implications that using a credit card payment method may not be favorable nor cost-effective for a start-up.
An acquirer that processes card transactions is needed when setting up card payments. There is a charge for this kind of service. If this payment method is not necessary for your customers, it is better to not opt to have it and simply stick with cash and cheque payments.
4. Learn Your Sale Cycle
Almost all businesses go through on and off seasons. The on-season would be the time or months that your business is booming, and of course, the off-season is when there are few inquiries or orders or none at all.
In knowing your sale cycle, you will have the time to prepare for the off-season wherein you have to have a money cushion in order for you to survive those months. Having extra money in the bank is a must during this era. Also, expenses in that season should be budgeted way ahead for preparation.
5. Hire Professional Help
Every single business needs help, most especially if you are new in the area of handling a business on your own or even with a partner. Most of the time, taking a shot at engaging with the services of specialists and experts in certain fields and industries is worth it. They can help you determine your goals and even reach them, ensuring that your business is going to the path that will give you gains more than losses.
The United Arab Emirates (UAE) is a business hub, full of new and old organizations. For your company to survive, having professionals with a wide experience in various fields is advisable. FAR – Farhat & Co., offering an accounting service in Dubai and having more than 30 years of experience, can give you an unmatched quality service. We have some of the best accountants in Dubai, prepared for any financial enquiries that you may have. Book a consultation here with us and find out how unrivaled our accounting services are and why we are one of the leading accounting firms in UAE.