With the current economic challenges facing many Nigerians, many new businesses are folding up rapidly, some due to genuine lack of funds, others due to poor financial management. Money will always be a huge challenge for any entrepreneur who owns a new business. It is never enough. So, as a new business owner, there are some money mistakes you should not commit no matter the kind of business you are engaged in. If this happens, you will discover that you are just throwing unavailable resources at your business without having the desired impact Here are some tips to take note of on your path to succeeding in your startup.
Having a combined personal account and business account
Whether you are alone in the business or in a partnership, it is important for you to separate your personal account or money from the business. This will not only help you know the viability of your business, you will be aware of how much the business is making. Even if you collect money from your personal account to invest in the business, don’t forget to return it.
No budget for your business
For any serious new business with long term goals, it must have a pragmatic and realistic budget. A budget that is not above the available capital. The budget simply tells you how to spend money and the things you need to spend on. Ensure you strike out the things that you don’t critically need for now.
Making big purchases
You are in the teething stage of your business, so you don’t need big purchases even if you have bottomless finances. Buying cars, computers and going big on advertising is a no no for any new businesses. It is advisable to be strategic in spending and leave the big purchases for later.
Not saving for emergencies
You don’t know when a business emergency will happen. Hence, you always want to be prepared for it. This means that no matter how much you are making, ensure you save for unforeseen circumstances. This is important for small businesses if they want to survive the growing stages of their business.
Not paying taxes and utility bills
As a new business owner, you are tempted to avoid payment of taxes and utility bills. But know that you may escape it now but you will unarguably pay for it later. So, pay your taxes and utility bills as at when due to prevent it from piling up and avoid paying unnecessary fines that come with late payment.