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Business 101

Should You Start A Business - Do You Have The Money To Continue

Businesses are in perpetual need of investment whether in time or money - both valuable assets. It takes a smart business person to work out a plan to save the most amount of time, money and effort to get the job done. Planning a business and financing a business are critical to your long term success. Getting a business started is easier than keeping it going.

An important, and often overlooked part of a business, is the follow up. Unless your service is recurring, you will never see that person again without something to make them come back. A good business will have repeat customers. This is what will help your project become financially feasible. Without repeat business, you will be fighting an uphill battle making a profit.

Master your customer service skills. Follow up on orders to make sure they were satisfied. If they weren't, then do what you must to make them happy. Offer other products along the same lines. If they felt good about dealing with you before, they certainly will be likely to trust you again.

When you see that you have finally made a profit, don't be tempted to blow it on a luxury cruise. Put some of that money aside for a nest egg for living expenses and to expand your business. Make sure you have a comfortable nest egg to support you for 6 to 12 months just in case your business falls on hard times.

Once you have a cushion of financial safety, then slowly and cautiously spend the money. Consider investing profits in stocks, bonds, and other money making vehicles.

Obviously, there is a lot more to running a business than listed here. There are so many variables to consider depending on your business, your skills, your personality, your cash flow and other possibilities. This is why you should really think about what running your business will mean to you in all aspects of your life. If all this information just seems too hard for you to put into practice, you probably should stick with your day job.

Time IS money. Never forget that when you are running a business. It makes no sense if you are putting in 15 hour days only to bring in a profit of less than $15. What is your time worth? On a regular job, if you make $16 per hour you should try to at least make that kind of profit or more in your own business.

As time is a valuable assest, try to keep organised as it will be a great time saver. You may have to do hard work, but you do not have to make any task longer than it needs to take. Analyse your tasks and find the best approach to make it done efficiently and properly.

For the long haul of expenses in owning your business, it is best you have a nest egg to help you until your business becomes profitable. Do you have enough money to cover rent or mortgage as well as utilities, food and other personal expenses? You should not be taking out living expenses from your new business until you can prove you are able to turn a profit for at least 3 months. The money you make from your business should be re-invested into it.

The best thing is to have a nest egg equal to your living expenses for 3-6 months before you quit your regular job. Sometimes one will encounter a situation where this is impossible such as if they had been made suddenly redundant or they may have to quit a job to take care of an ill family member. Whilst it is best to have these funds available, you could still make a business work without a safety net, but you would have to be even more vigilant to make it work.

If you have a good idea and are showing consumer interest in your business or service, you could always approach the banks for a loan to help with expenses in funding a business. You would have to show the lenders a detailed business plan with proof of earnings to show that you are not just doing this on some whim. Creating a business plan, is critical to your success in getting a business loan.