You see many startups making successful businesses and many founders being millionaires. However they are just the tip of the iceberg. There are so many startups failing too. If you examine why they fail, you will see many reasons such as failure to hire right people, lack of innovation, mismanagement of finance, inability to access capital and most importantly inability to adapt changing business environment.
So if you are starting your own business, you should definitely avoid the mistakes made by others. No matter if the business is a large one or a small one, most of the mistakes are about finance. Here are some tips for you to survive your startup.
Cash flow analysis
Not so many founders have financial backgrounds. These people are just naturally curious about incomes and outcomes. There are many additional costs when it comes to making a sale such as recurrent and fixed expenditures, loan payments and etc.
So when it comes to avoiding financial mistakes make sure you balance inflow and outflow of cash and maintain a reasonable balance of cash at all times.
As a founder, you may not be good at everything or have time to do everything. However, you small business can. You need to consider getting the services you need from a consultant instead of hiring full-time employees. For example, it will be much more profitable if you use consultant for marketing instead of trying to figure out the best practice for your own.
If you want your idea and your business to grow and make a success, you need to make strict financial discipline a habit as a small business owner. Never plan for the best case scenario and spend more than you budgeted.