5 error of cash management is how to make the business bankruptcy

Knowledge in the cash management business, it is: essentially equal to the knowledge of sales and management. There is no business that went bankrupt because entrepreneurs lack knowledge in finance. Some entrepreneurs think the only strategy to sell only that they should be cared for sales as a source of business income instead they were negligent about money management received from the sale. Negligence to the point, it's really dangerous business will lead to failure. To prevent this problem, we take these 5 mistakes of cash management to elaborate.

Lack of capital for business

The lack of investment in the business is a major factor that makes a business fail. To avoid this, you must make sure you have enough money to pay for operating at least 6 months. Another factor is the rule takes effect. Cost management is: the most important, and if you neglect your business will fall even unconsciously you how much sales revenue.

Without proper financial statements to obtain loans

Many small business owners think debt is a bad business, because they feel that if their business problems, he will not be able to pay the loan back to the creditor. Such thinking, which makes business collapsed with no working capital. However, for business owners who are aware of this point has been a struggle to get capital for expansion and to the stability of their business. Still not sure that all businesses need to get a loan if they do not have clear financial reporting. Factors of financial reports would make clear they have not been able to get loans, and their business will have financial problems, which will lead to the closure.

Take business personal use

When you start a business, business capital consumption for personal use is a disaster for the business in the near future. You can imagine that you go to the supermarket and shopping with your company's bank account, do you think this Utah can help your business grown boys. It is clear that it can not flourish, and even walking to the road antechamber also because every time users of cash, the company's expenses will increase and your business will be unable to find profitable, nor agreed with a declining capital from one day to another.

No precise records about a customer's debt

The exploitation is inevitable that customers owe. The consumers owe too much and do not have precise records that your business will stagnate or shrink due to sales growth but not income, and sometimes loss also. As a business owner, it is necessary to have a record clearly and preparation methods to pay it back.

Pricing of products or services

Determining the correct sales price is: important in business when you set the price too high, you will risk losing customers, but when you set the price too low, you may have a damaged or lost income. The method can determine the best use of monthly spending reports, compared to monthly sales numbers, you will know whether you should sell at a price that you can get the profits from the business.