Financial Freedom Series: Build Your Own Business (Part 12 – Financial Skills)
Over the past few weeks, we looked at the terrible reality that 32% of South Africans are unemployed. In SA, it can be challenging to find a job. And, even if you have a job, you may still be battling to make ends meet.
Have you looked at all your options?
Are you prepared to consider an alternative solution?
Why not consider becoming an entrepreneur?
By starting your own business, you will not need to rely on others.
Could you use your current qualifications, skills, talents, experience, and passions to sell something you believe in, or to provide a service?
Could you offer a simple solution to help solve other people’s everyday problems?
Do you have a unique idea that could add value to others?
As a recap, you need to…
DARE TO DREAM.
“Hope deferred makes the heart sick, but when dreams come true there is life and joy.” (Proverbs 13:12)
HAVE A VISION.
“Where there is no vision, the people perish.” (Proverbs 29:18)
PLAN WELL.
“Good planning and hard work lead to prosperity, but hasty shortcuts lead to poverty.” (Proverbs 21:5)
BE WISE.
“The wise are cautious and avoid danger; fools plunge ahead with reckless confidence.” (Proverbs 14:16)
WORK HARD.
“Hard work brings profit, but mere talk leads to poverty.” (Proverbs 10:23)
INVITE GOD TO BE YOUR CEO.
“Remember the LORD your God, for it is he who gives you the ability to produce wealth.” (Deuteronomy 8:18)
“Commit everything you do to the Lord. Trust him, and he will help you.” (Psalm 37:4)
“Honour the Lord with your wealth, with the first fruits of your crops, then your barns will be filled to overflowing, and your vats will brim over with new wine.” (Psalm 3:9-10)
Today, I want to examine a few critical financial skills you must develop to run your business efficiently.
Having a few good business and financial skills can be the difference between your business failing and succeeding.
A solid financial foundation and the right business skills will help you to run your business profitably and protect your investment.
FINANCIAL SKILLS:
- Manage your finances well:
- It is of utmost importance that you manage your money well.
- Poorly managed cash flow can destroy your business.
- Boundaries:
- It is important to keep your personal finances and business finances separate.
- Put the proper safety checks and protections in place:
- Don’t take on too much debt.
- Keep your running expenses low.
- If you take on debt, ensure that you have adequate insurance in place to protect your business and your family.
- Do your best to limit unnecessary risk.
- Monitor:
- Keep good records.
- Record your profits and losses.
- It is crucial to monitor your cash flow.
- If you can measure it, you can monitor it!
- Budget:
- You need to know what is coming IN (INCOME) and going OUT (EXPENSES)
- Costing:
- Your product needs to be well-priced to ensure that you can make a profit.
- But your pricing model also needs to be competitive and offer value to your customers.
- Don’t be too greedy. But don’t sell yourself short.
- Create margin:
- Don’t spend everything you have.
- Build up your cash reserve.
- A cash reserve will reduce stress.
- Your cash reserve can ensure that you don’t have a cash flow crisis if a storm or unexpected event arises out of the blue.
- Your reserve will also ensure you have the needed cash flow should an incredible opportunity arise.
Plan for Success
Many businesses fail within the first year or two because of poor money management and a lack of basic business skills. Applying a few of the principles outlined above will give your business a better chance of success.
One of the biggest mistakes many make is overspending or having too many expenses. Keep your costs low when you start.
Delay purchasing items that you do not need, which will add unnecessary monthly expenses to your business.
To keep your business from financial strain and ensure good cash flow during the dry seasons, limit your expenses until your INFLOWS are consistent and you have BUILT UP A RESERVE.
Plan well, think things through, and take time before making big decisions. Consider your options from various angles. With a clear strategy, you can grow your business and financial skills over time.
John Maxwell’s take on LIVING YOUR DREAM:
- Find something you love doing that you are happy to do for free.
- Then get so good at it that people will pay you for it.
- You will then be living your dream!
In a Nutshell…
Can you use your qualifications, skills, experience, and unique gifts and talents to set up a business that provides a service? You could start small and work from home to cut costs.
Why not consider becoming an entrepreneur and starting a business or side hustle?
May God open doors of opportunity, give you wisdom, and take you on an adventure as you build your business. May God bless your business.
Please do not do it alone. Ask God for guidance. He wants to lead you.
Next week, we will continue to INSPIRE you and give you PRACTICAL TOOLS and INSIGHT to help you BUILD YOUR OWN BUSINESS to attain FINANCIAL FREEDOM while HONORING GOD.
