5 Money Management Tips by Mike Giannulis to Keep Running Your Business
A lot of business owners face a shortage of money. No matter what steps they take, they always end up mismanaging cash flow. In a survey, it’s been proved that 42% of small business owners cannot handle the cash flow. Through money management, you can control your business’s finances.
With a proper money management plan, you can avoid meaningless cash flow and ensure your business is walking on the right track to gain profit.
If you fail to use a proper money management plan, you’ll face some serious problems like late payment or shortness of money, which will harm your business.
If you’re struggling to make a proper money management plan, check out the following tips.
Keep a Track of the Deadlines
If you don’t track your due date of bills, such as business loans, or credit card payments, or EMI, you might land in shortness of cash. Most importantly, if you don’t remember your due date, you’ll receive a late fees notice as well as added interest. Failing to pay credit card loans will decrease your credit score, which is a bad impression.
To avoid this disaster, always keep a track of your deadlines. Mark the date when your payments are due and set a reminder! You can also write on your phone, paper, or calendar, so you can get a consistent payment schedule.
Mike Giannulis Suggests That You Should Monitor Spending
You should always monitor how much money you spend per week, day, or even month. If you don’t monitor spending, it can lead to excess spending and misuse of your funds.
Most of the business owners have numerous accounts such as savings account, business account, credit card account, etc. You must have an idea of how much money you can withdraw from each account to help you maintain a good account balance.
If you think monitoring your expenses is overwhelming for you, you can always use simple software. That software will help you to keep a record of your account transactions.
Use Personal Funds and Business Funds Separately
Do you use personal funds and business funds separately? When you use the bank account for business purposes only, you can monitor spending as well as track profitability.
When you mix two funds, tracking and monitoring spending becomes a lot harder, as you’ll become confused between your personal expenses and business expenses. Hence, you’ll lose track of your incoming and outgoing money.
Always Reserve Some Cash
As so many businessmen face backlashes in 2020, Mike Giannulis suggests reserving some cash for emergency purposes. If you keep a small cash reserve, then you can use it wisely and effectively, whenever you find yourself in a tough situation. It’s highly necessary to keep a cash reserve for emergency purposes and other inevitable circumstances.
Increase Revenue and Decrease Expenses
It may sound straightforward, but increasing revenue and decreasing expenses are harder to accomplish. If you’re facing difficulty at managing business funds, you may consider increasing the revenue and cut costs.
Either you know or don’t know, the most effective way to cut cost, is to start analyzing how much expenses you make. By looking at your expenses chart, you can identify the grey areas. Upon identifying, it’s time to eliminate those unnecessary expenses.
While decreasing expenses, it’s also important to increase your revenue. You can offer a new product, or offer discounts, or promote your products on social media to increase your revenue.
These are the 5 money management tips that will help your business to stay afloat. You can also apply new ideas that you think will be beneficial for you to enhance your business. Just keep a chart of everything. From your due dates to cash reserve, everything should be written either on paper or electronic device.