Are you hungry for your business to be a roaring success? Read this blog to avoid some of the common crazy mistakes made by small business owners and improve the chances of your business succeeding.
1 - Being the Jack of all trades
It is given that as an owner, your enthusiasm is high when it comes to managing your own business. You’ll get to the point where you are doing everything yourself, from administrative tasks all the way through your accountings.
At first it might be exciting, but in the long run, you’ll probably see yourself become extremely burn out, figuring how you can accomplish the never-ending task of a one-man team. Not only that you business will never be scalable.
As it continues, you start to realize that all your efforts are going down the drain and it is not as effective as you think, because it sets your business back from growing.
Before it completely damages your business, hire an expert to get the professional help you need.
2 - Mixing business with personal finances
Using the same accounts and cards to fund your personal and business expenses might be convenient. But when tax time rolls around, that’s the moment you’ll start to regret what you’ve done as tax nightmares arise.
You’ll either pay way more tax than you need, making it more difficult for you to claim a deduction or end up facing an audit.
That’s is why separating your business and personal finances is something all business owners should do to make sure that you can get the most out of your tax rebate. Setting it apart can also help you prevent misuse your business’ money for your personal expenses or one way or another.
3 - Overspending Early
Overspending on big purchases could be devastating and can severely harm your cash flow. To make smart purchasing decisions, plan ahead of time and consider the cost-benefit.
You should also analyze your business’ current financial situation and have a full overview of your expenses and incomes. This will help you determine when is the best time to make a big purchase and help you avoid overspending.
4 - Not saving up for emergency
Life is very unpredictable. There’s no guarantee that your business will always be smooth sailing or you’ll have enough funds to sustain your operations.
It is advisable to keep at least three worth of expenses in an emergency fund for both business and personal expenses. A savings account is the best place to keep your emergency fund.
Remember that you should only tap your emergency savings for expenses directly related to an unexpected emergency. And when you to take money from this fund, it’s important to immediately start rebuilding it
5 - Failing to Plan is Planning to Fail
Planning is one of the most important parts of running a business. Even if you are just a startup, it is crucial to have a business plan that pulls off your operational and financial strategy.
A good business plan can help you achieve both short-term and long-term objectives and let you identify potential pitfall. This also serves as the blueprint of your business that is important to your success.
Always remember to review plans regularly and update whenever your circumstances change.
6 - Ignoring Your Numbers
As your business grows, it is necessary that you know the basic accounting, so you can monitor your financial performance and abstain from any risks such as cash flow problems, embezzlement, or worse - bankruptcy.
You can enroll yourself in an online training course to gain accounting knowledge for your business. In order for you to ensure that you don’t miss anything with your accounting you can hire a Bookkeeper who will handle your day-to-day accounting transactions and an Accountant for more complex accounting issues.
Have you made any of these mistakes above? If yes, resolve it real quick! Don’t let it hinder your way to success.
If you need any with your accounting our team of experts here at Bookkeeping Central are willing to assist you. Give us a call at 1300 855 763 or you can schedule a FREE consultation with us here➡️ https://bit.ly/2NKWSGK
We look forward talking with you and see your business grow.
