How to Avoid Getting Bankrupt
In my previous article, I wrote on how to raise capital for your start up business. And here, I will be telling you what to do and How to Avoid Getting Bankrupt or running into financial meltdown in your business.
Over the time, so many business establishments have gone bankrupt and broke to the extent of either closing down the business or salvaging and thriving to survive out of loan. Here, Gudtalent Chrisent gives down the detailed information on how to avoid the menace of closing down your business establishments.
WHAT TO DO TO AVOID CLOSING DOWN YOUR BUSINESS
- Set personal needs aside from your business
People have always made the mistake of putting in their personal needs into their business. You are best advised to set aside your personal needs from your business. Please do not take money out from your business to buy any of your personal needs like: recharge card, lunch, snacks, transport money, etc. the money for all these needs should be sourced from your savings and it shouldn’t be more than your capital. You will watch your business cripple down if you vehemently remove money from your business pocket no matter how small it is.
- Use your time well
One thing with time is that it does not wait for anybody, anytime lost can never be regain ever again, some entrepreneurs often make the mistake of procrastinating with their business. Go to work early and don’t be in a hurry to close so far as you are the CEO of that particular establishment. As the boss, you are meant to be the last to close from work after taking, checking and balancing up the day’s transactions. Do not leave your business to other functions that are not relevant like visiting a friend, going for shopping just to mention but a few. Time management is one of the keys needed for any business to succeed.
- Don’t put friends and family into your business
It’s true that your friends and family can help you with startup capital but at the time, they can lead your business to zero or debt level. People often make the mistake of helping their friends from their business capital forgetting that capital is different from profit. I must warn “don’t help anybody with you capital money” hence you can help as many as possible with your extra or profit cash. When your friends and family buys any of your products, them paying for that product or service is as important as the money they gave you for starting up.
Related: Watch your expenses
That your business is growing fast does not mean you should start spending like you got it all and can never go broke. Extravagant spending have sent many business establishments into exile. So watch and control your spending.
- Book Keeping is Important
Take down all the records of all transactions carried out and make sure everything concerning your business is put down in recorded and backed up somewhere else in case of data loss.
- Watch your staff closely
If your business is large enough that you’ve employed people to work for you, do monitor all the activities and how they go about your goods/product/services in terms of sales and record balance of the day to day transaction as most manger of your business will always try to introduce their own selfish interest and lobby they money that should go into the business/company purse.
(NOTE: if this is not checked, you will start experiencing shortage of goods at the end of selling each badge/trip of your goods/products)
- Take a survey of your product
Once in a while, take a road-street walk and ask questions about how people see your product and pay a very good attention to whatsoever they say about it. If they say good about your product, KUDOS but if they are complaining about your product, please do take a review of that particular item and improve on it on time to avoid losing your customers.
- Be quality conscious
That your product is invoking today and broke into the market does not mean that; that particular product quality may not need to be upgraded tomorrow. That is why people still use Nokia phone even when they have the best of iPhone, blackberry, Sony, tecno etc just because they produce a reliable and stronger battery. Always be quality conscious to avoid competitors hitting you off the hook and taking your product buyers always from you.