If you already obtained capital for your business, Get ready to manage your money, organize these resources and have them available strictly to meet the objectives you projected. Analyze the current situation of your company and dedicate enough time to make your payment plan, in order to get the most out of the money you received.
Ask yourself the following: What threats and opportunities do I see in the future of my business? Take into account that market structures and conditions can change. Maybe today you have great prosperity, but tomorrow a totally different situation may arise. So consider the different scenarios, both positive and negative, to manage your capital.
Start your plan today and put these tips into practice.
Tips to manage your money
1. Prepare your financial budget
Spending without planning will only leave you without resources. Therefore, start by balancing your company’s income and expenses, encourage internal savings and create a fund for unforeseen situations. It is essential to prepare a financial budget, which is nothing more than the forecast of your expenses.
Next, define the financial objectives of your company. To do this, ask yourself the following question: Can I face my financial commitments responsibly and without going through difficult times? If not, one option is to have an open line of credit with a bank, which you will only use in emergency cases.
2. Calculate the price of financing
Although you already know the interest rate on the financing you obtained, experts recommend that you check it again from time to time. This is because interest rates fluctuate for various reasons: behavior of inflation, supply and demand of securities at certain terms, international interest rates, economic growth, etc.
The forecast of the fluctuation in interest rates, whose main reference is inflation, is the key tool that will help you design your financing distribution strategy. Remember that the performance of your business must be at least double the interest rate on the loan. This way you will not generate losses for your business.
3. Diversify your capital
In the financial world you will often hear it said “you don’t have to put all your eggs in the same basket”. The solution: diversify in order to reduce risks. If you have to expand your infrastructure, buy supplies or carry out a merger or acquisition strategy, organize your capital to meet all these goals. But be careful, don’t forget that too much ambition can compromise your resources, while excessive caution will make you lose important profits. Therefore, diversify, but in order.
4. Set goals in a certain time
Keep your numbers in order and schedule your payments in a timely manner. Create a plan according to how you feel most organized, trying not to weigh yourself down with an excessive burden or commit to what you cannot fulfill. You must be realistic.
Selene Ávalos, finance director of Urbi Desarrollos Urbanos, says that financing is one of the fundamental tools for growth. However, the discipline to manage payments is the ideal complement. Her company, for example, began as a family business and, since 2002, is listed on the Mexican Stock Exchange. Her secret: keep your financial commitments. First it was with the banks, and then through the issuance of debt and public offering of shares.
5. Prepare for new financing
If you already got your first credit, rest assured that you will go for the second. That is why it is key that every time you make this commitment you do it responsibly. Complying with your payments on time will be your best letter of introduction to new organizations and institutions that will offer you larger amounts, better payment conditions and preferential interest rates.
Complying with your payments on time will be your best letter of introduction to new organizations and institutions that will offer you larger amounts, better payment conditions and preferential interest rates.
What other tips do you have for managing your business money?