Ready to start a business? Very cool. Some tips that are to be discussed here can help you run a successful business. Did you know that there are various unexpected big expenses that may come up when you first start a business?
First Time Starting a Business, What Unexpected Big Expenses Can Come Up?
There are big expenses that you need to prepare for if you want to start a business. However, there are also big expenses that can be avoided so that your business does not suffer losses and can maximize profits.
1. Emergency funds for your business
There was a businessman named Sam. Everyone liked the crispy tofu that Sam sold. Sam's dream of expanding his business by opening branches everywhere, finally came true.
Unfortunately, Sam forgot one important thing. Sam didn't set aside any money to save as emergency funds for his business. One day there was a fire near one of Sam's branches. Sam's crispy tofu cart caught fire.
At this moment, Sam felt confused because he didn't know whether he had enough money to make a new cart. Coincidentally, soon there would be a lot of bills that need to be paid. If he did not pay them, branches in other places could also stop operating, meaning they would not operate temporarily.
Sam started to regret it. If he had built emergency funds for his business, then Sam was able to immediately use the money to restore his branch. Sam was forced to temporarily close the branch in the area that experienced the disaster until he collected sufficient capital to recover the business.
2. Incorrect stock estimates
There was another business owner named Dani. After only a few months of running the business, his products immediately sold well on the market. Many people flocked to buy his products because the prices were quite competitive.
Based on that experience, Dani immediately stocked more products, especially when there were big discounts for wholesale purchases. In his heart, Dani was very sure that his products would sell out in an instant.
But it turned out, Dani was too confident and there was still quite a bit of leftover products. In fact, the leftover products were about to expire. Dani, who initially wanted to increase his profits, ended up losing money. It costs a lot to buy stock but in the end not all of it is sold. Don't let it happen to you.
3. Spending a lot of money to learn a lesson
Lisa was a friend of Sam and Dani, but her business was different because Lisa own an online store. There were some problems when selling products online. Lisa spent quite a lot of money to learn and better understand online business.
During the first few months, Lisa had to spend money on shipping costs, refunds and much more. Lisa started learning how to pack orders better so they don't get damaged and various other things that can help reduce expenses.
Lisa also tried placing advertisements on social media to increase sales. But it turned out, advertising costs were greater than the sales obtained. Lisa ended up making no profit at all.
Other Important Tips When Just Starting a Business
Apart from being prepared for unexpected big expenses when you first start your business as discussed above, what else should new entrepreneurs pay attention to?
1. The goal to save money, actually results in losses
Interested in opening a restaurant? You can learn from Icha. In running her fried chicken restaurant, Icha was only assisted by 2 employees. Why were there only 2 employees? Because she wanted to save money, Icha handled most of the business matters herself. One night Icha didn't sleep because she stayed up late making a report.
The next day, Icha started having a cold and not long after that her health immediately dropped. Because Icha was sick, the two employees had to take over Icha's job. Overwhelmed by how much they had to do, they both started to feel unwell and later got ill. In the end, the restaurant had to close temporarily. Icha's intention to maximize profits ended up being a failure.
2. Separate business finances and personal finances
It's super important to separate business finances from personal finances. There are many reasons to do so, such as making it easier for you to review business performance (whether it is generating profits as expected) and making plans and strategies to grow your business better in the future so you can maximize profits.
Open Multiple Bank Accounts in the Jago Application to More Easily Manage Money, Save and Budget for Expenses
Have no idea about how to manage money, save and budget at the same time, not only for business needs but also for personal needs? Having multiple bank accounts is the solution.
Having lots of accounts won't be a hassle if you have a Jago account. In the Jago application, you can create lots of Pockets to manage your business and personal finances. Each Pocket has its own account number, which means you can have multiple accounts. All accounts can be monitored in 1 application.
1. Create Spending Pockets for business expenses
You can separate various business expenses such as purchasing items as stock and employee salaries using the Spending Pocket. Not just 1 Spending Pocket, but up to 20 Spending Pockets that you can create in the Jago application. So, there's no need to worry if you want to separate business expenses and personal expenses.
2. Create Saving Pockets or Locked Pockets for short-term business financial goals
Does your business have short-term financial goals? Separate and save the money in Saving Pockets or Locked Pockets. For example, for employee THR, you can save every month starting one year in advance so it doesn't burden you. Create a number of Saving Pockets as needed so that business savings and personal savings don't mix.
Also read: Differences Between Saving Pocket and Locked Pocket
3. Open Jago Term Deposits to build emergency funds and save money for long-term business financial goals
A Bank Jago product that can also help you and your business achieve long-term financial goals such as expansion or opening a new branch is the Term Deposit. By saving in a Jago Term Deposit, you will earn higher interest than regular savings. Deposits will also protect savings from being used for purposes other than achieving financial goals.
Apart from long-term business financial goals, the Jago Deposit is also suitable for saving your emergency funds. Disbursement of the Jago Deposit is hassle-free as it is done directly through the Jago application. Disbursement of the Jago Deposit before its maturity date also gives you peace of mind because you don't have to pay any penalties or fines at all.
For Jagoans who are ready to start a business, whatever business you want to run, Jago and its features are always there to help you manage your finances more easily and practically.
