Starting and running a small business can come with many different challenges. For most small business owners, worrying about money is at the top of the list.
Money management tips for cabinet small business owners
Don’t mix business and personal expenses
There are many reasons not to mix business and personal accounts. Resist the desire to use private funds to protect your business finances when things get tight.
The best way to clearly separate your spending is to create a personal budget and a business budget. Keep them strict and separate so credit cards and business loans are not used for your personal finances and vice versa.
Negotiate with dealers before signing a contract
Sometimes it takes a little searching to find a bargain. Try to negotiate a better deal when buying from sellers or contracting with suppliers. Don’t forget to also consider the terms of the purchase when making your decision, e.g. penalties for late payments and grace periods. If you get an additional payment period of 30 days, you can sometimes save more than 5% discount.
Pay your bills promptly
Just like with your personal funds, it’s essential to pay all your business bills properly. Credit card and loan surcharges can cost you dearly, but even small supplier and utility bill surcharges can add up. If you pay too late, you have to reckon with severe penalties.
Set up monthly reminders to ensure no business bills fall through the cracks. Profit and loss margins are slim, especially for young businesses. Avoiding late payment penalties could mean the difference between ending the year in the red or in the black.
Make thrift a habit
You don’t have to become a die-hard saver to save on normal business expenses. Take advantage of sales on office equipment and supplies and save on utility bills.
Spend some time in an introductory accounting course
As a wholesale bathroom cabinets small business owner, you’re not automatically a genius with money. Still, you have to make important financial decisions for your business. Even if you hire an accountant or work with an accountant, you should know the basics of business accounting if needed. Take an introductory accounting course online or at your community college and learn how money moves in and out of your small business.
The more you know about your business finances and cash flow, the better prepared you’ll be to make smart financial decisions. And while these tips will get you started, nothing replaces initiative and hands-on work when it comes to it to manage your money no matter how big or small the financial challenge.