For anybody, starting a business is a stressful and exciting time. Deciding to leave the rat race and become more self sufficient is certainly an admirable thing to do, but there are some pitfalls to be aware of. Especially when it comes to finances, you’ll notice startups making mistakes. Unfortunately, finances can make or break a business, so it helps to be aware of the 5 financial mistakes that most startups make. Read on to find out what they are!
Not Finding A Financial Mentor
Most startups won’t think about finding a financial mentor. They’re too concerned with all of the other things they have to think about when starting their business, that the idea of getting a financial mentor doesn’t even enter their heads. However, finding a mentor is one of the smartest things that a startup can do. Every successful business owner has somebody they can talk to about the ups and downs of starting a new business. This person will help them to make difficult decisions, give a new perspective on situations, and more. Keeping money organized is one of the most important and difficult things about starting a new business. There are financial services that will work with businesses at any stage, so you don’t already need to be successful to afford this service.
Make sure you find a financial mentor, whether this is an account, a family friend, or a financial firm.
Relying On Somebody Else To Know Your Numbers
Sure, you can rely on somebody else to know your numbers, but knowing them yourself is far more beneficial. As a business owner, you need to know how much you have coming in, what your expenses are, and more. Then you can take the steps to become a frugal business owner, without compromising on quality.
Failing To Get Business Insurance
Failing to get business insurance might not seem like a financial mistake at first look, but it can greatly impact your finances if you’re careful. Business insurance may seem like an expense you don’t want to get at first, but finding a reputable company like www.garrity-insurance.com/ to insure you will protect you from future issues that could crop up. It’s always a good idea to prepare for the worst!
Forgetting The Importance Of Frugality
As we’ve mentioned in the post, becoming frugal is a must for any startup. It doesn’t matter how much capital you have, how well your launch goes, or any of that stuff. You just don’t know how well things will be going in a few weeks or months, so taking the steps to save money is important. Can you strike up a better deal with your suppliers? How can you cut back on costs in other ways – second hand equipment, maybe?
Not Setting Clear Goals
Having clear goals for your business will keep you focused. Without them, you’re sort of ambling along without an aim and just hoping for the best. Clear goals allow you to put plans in place!