How to Manage Your Business Finances

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mehedieco2
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Joined: Sat Feb 11, 2023 4:08 am

How to Manage Your Business Finances

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Behind the great potential of an online business and its meteoric growth, it turns out that there is a threat that cannot be underestimated. Moreover, if not bankrupt. In mid-2020 once wrote that there were 5 digital-based startup businesses that couldn't survive. The reason is not solely because they cannot compete with competitors who keep arriving or the pandemic, but also because of the inaccurate business financial management. Start Selling Online with LummoSHOP! With a complete and practical online shop website, there are no more barriers to optimizing your business growth opportunities. As a D2C ( Direct to Consumer ) online business just running, have you ever been in the position, "I feel like I have a lot of turnover, but how come it seems like there's no result?" If not, be grateful. However, don't be reckless . If so, this is an indication that you have to improve how you manage business money. Of course, you don't want to suffer the same fate as those who have “give up” because of problems with how to manage business money, right? Proper allocation or management of business finances is one of the keys so that your business is not only as old as corn, but sustainable.

Even if you are just starting out selling online and haven't shown the results you hoped for, there's nothing wrong with implementing good and correct business management methods. This is the Industry email list same as the parable of not having to wait to become an important person or famous person first, not to have good manners , because that is something that absolutely everyone has to do in order to live a more orderly and better life. Table of Contents Hide 1 D2C Business Finance Allocation 1.1 Separate Business and Personal Money 1.2 Define Fixed and Variable Costs 1.3 Don't Be Tempted to Use Business Money to Fulfill Your Lifestyle 1.4 Always Make Neat Financial Reports 1.5 Your Desired Profit Increase Target D2C Business Finance Allocation Then, what do you need to do in this D2C ( Direct to Consumer ) business related to business financial allocation ? Separate Business and Personal Money Not solely for the sake of professionalism but separating business money from personal money also avoids misunderstandings in the future. Don't just because you are a business owner can then ignore this problem. " Ah, we'll separate it later, it's just running anyway !" NOPE . If necessary, create your own account so that it is easy to control it.

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Define Fixed and Variable Costs FinanceDetermine fixed costs and variable costs from the start. Fixed costs are costs that you have to pay regularly regardless of whether there are sales or not, for example electricity costs, internet subscription fees, and the like. Meanwhile, variable costs are as the name suggests (variable) whose amounts change depending on how many activities you have during a certain period. For example, this month you often meet suppliers and to reach them, you need a taxi whereas in the previous month you didn't go anywhere. From this example, it can be seen that the variable cost of taking a taxi this month is greater than last month. Some examples of variable costs in addition to these examples, for example: Costs for developing a business. You can set aside periodically from the profit you get, for example 5% of the profit for that period because your business is still just starting up. Backup costs for worst case scenarios . You should also allocate this periodically just in case when external conditions deteriorate so that it impacts your business. With this cost, at least you can still survive for some time in tragic conditions while planning the next repair strategy. You can save this reserve fund in another form, for example precious metals whose value is more stable or resilient. Employee salaries and bonuses .
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