The attraction of being responsible for your own financial destiny has become increasingly popular in Kenya. More and more people are moving to entrepreneurship as an alternative or complement to their monthly salaries. All this in the quest towards financial independence.
However, the road to financial independence is not easy and many aspiring entrepreneurs are struggling to find stability in their businesses. Most business owners have to overcome many challenges as they try to compete with the larger and seasoned competitors.
These competitors are able to leverage their deep pockets to corner the market and lock out smaller businesses. So, to level the playing field, small businesses have to adopt blue ocean strategies. Desiring to compete on this level requires a certain discipline and diligence that steadily grows your business.
One of the major hindrances to this gradual growth is the lack of effective management particularly of the money that is flowing into and out of your business venture. Managing your cash flow effectively means picking up a few disciplines that enable you to spend money wisely and save money wisely. As a business, you cannot afford to mismanage funds that could be geared towards your own business’ development.
Most entrepreneurs attribute their lack of cash flow to lack of adequate funding, however, the two are not co-related. In order to manage cash flow, a good place to start is by managing your financial accounting systems better. When it comes to saving money, here are some tips that can help you.
Get an expense sheet, write a budget and follow it
As a business owner, the first thing you must do constantly is to track down all your expenses in an expense sheet. It is advisable for you to get into this discipline from the very beginning. Every single expense should be written down and provisions made on it in the operational budget.
A business with a budget means a business with a financial goal. Keeping records allows you to track expenses, abide by your budget and work towards accomplishing your financial goal.
Prioritize expenditure
You cannot completely isolate your business from incurring costs. That is why it is important to develop and cultivate the discipline of prioritizing these costs. Start by creating a list of all items the business needs in order of most urgent to least urgent. to start and operate effectively, including things like computer equipment,
From here you can fit them into your budget and work towards getting them gradually and in a way that does not dent your financial position.
Go for cheaper advertising platforms
In today’s information age, the conventional advertising options such as television, radio, and print media can be too expensive and unnecessary for your business. However, if you opt for the internet and social media advertising, it not only takes advantage of our increasingly interconnected world but also allows you to access a much larger audience in a less expensive manner.
Focus on growing your talent and not money for expansion
As much as you need to grow, try not to spend all your time and energy seeking more resources for that growth before your business is ready. The costs of making these financial proposals can be high and time-consuming.
Not everything should revolve around money. Especially in the formative stages, most businesses require the knowledge on how to improve business processes and grow more than they need funding for that growth. The growth should happen as a result of improved processes.
Leverage your partnerships
Having the right strategic partnerships is essential to your business sustainability. You can partner with other businesses in different capacities so as to enable you to form a conducive operating environment. You can also opt to co-sponsor events or activities so as to share costs. Partnerships enable you to share costs and save money which you can re-direct into the business.
Negotiate for better deals and discounts
Always try to obtain the best deals when it comes to dealing with your suppliers. You will find that most vendors are willing to give you a discount instead of losing a valuable customer.
When you have to make large purchases relating to the business, ask for quotes from different firms and compare them so as to identify those with reasonable prices. Look out for firms that also offer extra services for purchases made. It may seem insignificant at first but in the long run, you will save a hefty sum of money.
Save the paper, save the business
Going green in your business can help you in cutting down a lot of unnecessary operational costs especially when it comes to printing. A simple action like buying a printer that prints on both sides of paper reduces paper waste or completely not printing goes a long way towards saving costs for your business.
So starting a business and being in business is a great idea, however, one must be cautious and wise about how they choose to run the business. As you work on building a brand, try to adopt disciplines that allow you to start saving money from the beginning.
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