Money is not only a problem for those who are employed. It is even a bigger problem to those who make it. Like business people.
Employed folks struggle to make enough money to achieve a fraction of their dreams and have to live with the fact that they have to wait for thirty days to receive the exact amount of money they received thirty days before. And with that kind of amount of money these souls do not meet all their financial obligations. Those who manage to meet their budget and save are blessed; sometimes have to forgo some of their worldly cravings in order to satisfy their financial aspirations.
Employed people have a cosy cushion, a guarantee that every thirty days they have someone to give them money to live another month.
Business people have to make sure that they make enough money for themselves and their businesses to survive. Business people have to sell, buy, sell, save and buy and sell, and save again. Without money they cannot buy raw materials. Without raw materials they cannot supply to their customers. Without customers, and raw material, they cannot be in business.
There are people who are in business to survive. And there are people who are in business because they are solving a problem for their customers.
People who are in business to survive are sometimes a desperate lot. And most of the times these people are in an informal business. When no one uses their business they become frustrated and shrug their shoulders, asking the question ‘why is everyone not using my business?’ And when, miraculously, the business is not doing well and they have no money to spend on themselves they find that as an opportune excuse to raid the till and fiddle with the cash-flow. And once the business owner starts disturbing their cash-flow then we know that the whole flow of the business will be negatively affected.
So be wise and start a business for the right and correct reasons. Look for a problem to solve for the people, for the customers. Look at the times when you wanted something so badly and it was not readily available at the time. It was not available because the concern was closed, or the stock is not always available. And that something is something that is a matter of life and death, and sometimes, it is even more than just that. So your quest is to make sure that situation does not happen again-to you and possibly to a myriad of others.
You start to make inquiries and the reason you want to help yourself and others it is not to compete with the other business. No, you want to provide a service to people who need it when the other concern is not available. Or you know where to get the stock much cheaper, or your clients need the service or product differently.
That way you will run a better business which will make money for you and your business. And so you will not stress much and so you will not raid the till.
But I am far away from the mark. I wanted to chat about financial management, and more especially paying your self as the business owner. It is simple. Draw a salary, a wage, like everybody else in the business. Pay your wife and pay your children as well as the cousin and the uncle. And bank the business money according to the specifications of your business plan. And to make this measure work even better employ a stern, shrewd bookkeeper. Not so much shrewd to con you, but stern enough to keep you in the black. Make as if you are employed by someone else.
That way when you look at your business bank balance you will smile even if personally your salary or wages is depleted. And you should harvest a habit of personal banking, because remember you are working for somebody else. You should pay personal taxes and buy endowments, retirement and funeral policies.
When you are in business you have actually not solved your money problems. You have actually created a problem for your self-how to deal with money.
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