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The financial part of a company is one of the issues that entrepreneurs must deal with in advance in order to clear financial questions and thus avoid jeopardizing the firmness and profitability of the project.
Starting a project is a way that leads to relate to the financial world, a scenario where new entrepreneurs may feel uncertain, therefore, it is essential to be guided by business advisors specializing in financial issues and to allow the entrepreneur to collaborate on a project optimal and solvent.
What you should know about finances
The world of finance involves terms such as: interest, credit openings, participation certificates, flows, investments for business growth, cost analysis, among others that make those who decide to start with doubts to face.
These are issues that require guidance with specialists in the financial field. But, everything that can be practiced reaches good results in the economy of companies .
In the world of finance it is necessary to understand that the money that enters the company must be allocated for the business, in consumption, tax payments and savings and investments . When we refer to savings it must be taken into account that it can be saved to predestinate in case of problems with the company or emergencies.
The employer must be clear about the fulfillment of all business commitments, from banking to salary and inventory replenishment . Profits and expenses is the most appropriate relativity at this point.
Calculation of the dead center
One of the most frequent financial questions is the estimate of income that your business has, or what they call the calculation of the deadlock, whether it is the sale of products or services provided by your company. The important thing is to be clear about what you need to cover the expenses. This is a basic formula that any entrepreneur must manage, have time or not with your project.
Knowing what your stalemate will allow you to estimate your expenses, if this is not clear, it is most likely that you end up closing your business or business , or at best, reduce all expenses to reduce that level of Deadlock and being able to float your business.
To do the calculation you must know the sum of your income or the products you have sold, of course, this will depend on the type of company. You can very easily do it in a simple Excel spreadsheet or any format similar to this one. The most advisable thing is that you do the monthly calculation, but you could do it annually as well.
These are the steps:
- Make the estimate of income and expenses for the time that is your preference (usually a year) without VAT.
- You must separate the fixed costs to the variables, which have to do with the purchase of products or the provision of the services offered by your business.
- Now calculate the stalemate, this being the quotient of the costs, between the profit margin that your companies receive .
Improve finances with these tips
Entrepreneurs have the challenge of facing finance as a means to know how to grow my business . Aspects such as investment and good management of some tools that contribute to the progress of a project must be considered, we must bear in mind that if you have the possibility of having a project manager in your business, everything will be more controlled. Next we will examine which are the most common scenarios that cause financial problems in a business and that deserve to be known by the new entrepreneurs:
The control and recording of income and expenses is one of the ways to know the fate of the business money and the present assets, this has the purpose of optimizing the finances in the company. This control also helps to have an inventory at hand which leads to a solid image, attractive to new investors, financial entities that provide support and even a growth of clientele.
Evaluate the information that leads you to strategic conclusions, if you have had control of the finances that involve the previous point, it is possible that the entrepreneur can easily deduce and get how to find solutions to problems, turn weaknesses into opportunities and take advantage of the strengths of the business to estimate new impulses with investments that may be necessary.
This same evaluation gives the entrepreneur the calculation of the profits that customers can generate individually and in this way, the estimation of the costs of the products or services that are being consumed in order to establish an amount to invest in that demand. and in offering new consumptions, so that you can design an annual budget with the profitable finances.
The finances of companies and personal must be separate, the expenses and income you have as a natural person does not correspond to the legal figure that you represent, in addition in each case the tax payment is different. For this it is advisable to determine a suitable salary, adapted to the financial reality of the company. The profits corresponding to sales should be considered as new investments that will increase the amount.
Monitor debts , achieve financial credit is another of the company’s objectives to conceive profits. Although the income of that money corresponds to temptations, it is best to think of investing a money that generates interest every day. Therefore, the evaluation of the direction of the debt is essential to guarantee the future solvency and business liquidity, in addition to the peace of mind that an investment was made to pay the monthly interest.
It is pertinent for the entrepreneur to keep in mind that the lack of payment causes an accentuation in the interests, which would be established as a loss for the company and that accepting a debt, can be positive if he knows how to maneuver with commitment, the analysis of his destiny is a job that requires advice.
Digital tools are a great support for business finances, the rise of technologies in business progress is evident nowadays, that digital platforms have been created that offer permanent inspection in business finances. Let’s mention some of them:
Xero, is an easy to use online system where it is possible to manage from the invoices, control the sales involving the register of purchases, bank accounts, accounting and inventory.
Another tool used is Mint , an application that organizes all the bank accounts of a company to be channeled into saving money. It is a tool designed for companies with few partners or personal businesses, with it it is possible to specify saving objectives taking into account the calculation of debts on credit cards or financial credits.
Square, is also one of the most useful platforms in the financial field designed for businesses that provide direct customer service. Its collection system is one of the advantages and that can be done with any card which provides a modern process when it comes to monitor payments.
Advisor to clarify finance questions
If the doubts of finances are many , hiring the services of a professional adviser will minimize future inconveniences. They are necessary if the experience in the business field is little or nothing. If it is your case, obviously everything related to financial planning is new in your life. It is not the best idea to try to do everything alone without knowledge, it is not the best start and less if you do not have practice or time.