When it comes to economic issues, one of the biggest problems in small business is financial planning because they generally do not know how to properly manage their resources and prepare to have an emergency fund in bad times experts say. It happens to many companies, when it starts to go well they forget to plan and lose sight of the risks they may suffer especially in times like this that the economy is so volatile.
The cost of advice for example an independent accountant to business can represent about 10% of the total expenses of the company, which is not much if the results that this decision may represent future is considered. When creating the management strategy for your business, it is important to think about issues like recession.
Stick to a plan. You should always have a budget of income and expenses (outflows) of your business, which will guide you to make financial decisions especially if you got some credit for your business. Take this plan by updating it according to your needs and the economic moment you are living, recommended the professor of Finance in the master’s degree in High Management.
Interests, inflation and the exchange rate are indicators that will help you to project clearly, how your money is moving just one-example prices and the cost of raw material are modified by interest. A good way to have more knowledge about how to manage money is to analyze some data about the sector in which you operate. Find out how much sales fell in your activity in other times with crisis. What months were the worst? Does your sector go into recession before at the same time or after the national economy?
Clear accounts keep a daily record of your income and expenses. That flow of inputs and outputs is the basis for creating your management strategy, says the representative of the Universidad. It allows you to plan your payments and, in turn, define your balance that is what debts are in the immediate and with how much capital you have to pay them. This is a good “thermometer” to know what kind of financing you can ask for your company.
Follow a schedule. Fully respect the deadline to cover your financial commitments, such as credit cards or loans received. However, not because you get a good run you have to spend more than indicated. Sometimes the entrepreneur registers an increase in his profits he swallows thinking that this can be permanent and even seeks to increase lines of credit without considering that he is currently living a very voluble stage and at any moment, there may be vicissitudes that prevent him from fulfilling with its economic goals.
Look for new options. Interviewees agree that the financing cheaper the internal ie as a company must generate sufficient profits and reinvest to grow. However, there are other ideas you can consider to multiply your resources as long as you have assessed what it means to start growing your business with a loan. If you are inclined to a bank loan if you already have a loan this institution will ask you to cover the entire loan. In case of having a loan with microfinance institution there is the alternative of returning with them guaranteeing that the new line of business represents good returns.