Mistakes That Affect Your Company's Financial Health

Every entrepreneur seeks to keep his company financially healthy. However, not every entrepreneur has the necessary financial education and ends up making many mistakes when it comes to controlling their accounts. Therefore, see below the mistakes that affect the financial health of your business:

Not knowing how to price your product correctly

First of all, many people who are starting a business do not know how to correctly account for the pricing of their products. It is not simply covering the cost, adding the profit and comparing it with the competitors' prices. This process is one of the mistakes that affect the financial health of your business, making it unstable.

When pricing your products or services you need to take many things into account, such as: accounting for taxes, accounting for freight, transportation of raw materials, transportation of employees if necessary, among others. However, by pricing incorrectly, you may be paying for doing work. This is why pricing your product correctly is essential for the financial health of your business.

Not having a strategic financial planning

Strategic financial planning is essential for the development of a business. So, knowing where to invest more, cut expenses, when to buy more stock, do promotions, sweepstakes, among other things is fundamental.

In addition, it is always necessary to think about the future, especially the future of your business. Stipulating goals is essential to always be evolving, when you have goals, you do everything to achieve them. All this must be decided strategically, by looking at the data, i.e., no decision should be taken just by "feeling". Furthermore, it is necessary that this data is monitored monthly, so that you always have in mind what to do with the money.

Not having cash flow management

Not having control of everything that comes out of the cash flow is extremely dangerous for the financial health of a business. Not knowing your costs and revenues can lead you to spend more than you can afford.

However, with a control, it is easier to know which goals should be beaten, where you should spend more, where you should spend less, which investment is not giving return, which investment is giving return, etc. For this it is necessary to update the cash flow daily, put all the data on a spreadsheet or on a management software.

Not knowing how much stock you have

Knowing how much stock you have is very important to always have an idea of what sells more, what sells less, what has spoiled, and most importantly, to know how much money you have in unused stock. That said, it is essential to have some kind of stock control tool. Consequently, this can help you to always keep it lean, always with only what is necessary to produce and/or sell and not leave your money idle.

Not doing data analysis

For a good financial health in your business it is indispensable to always have indicators and regular reports of everything that happens inside your company. Knowing exactly what is spent on Marketing, with employees, with transportation, always follow up month by month.

Besides all this, use the cash flow, the stock control, and always leave it reported. In addition, in the cash flow for example, sometimes we forget that we buy some things in installments and when you have a business these installments are higher, if all this is not reported it is possible to lose control of expenses. To not go crazy with so many invoices coming in, having control of everything is essential for the proper functioning of a company.

Mixing business money with personal money

"The company's cash cannot be the entrepreneur's pocket". This is one of the worst mistakes and one of the most committed by entrepreneurs. Not being able to distinguish what is personal equity and what is the company's equity can bring a lot of headaches. Therefore, it is essential to have all accounts completely separate, from profits and expenses. Mixing the two can cause big losses in your company, even if sometimes the losses come from "personal cash".

Also, if you have a physical store and want to open an e-commerce store, the ideal is that the two have separate accounts as well. Because if the two are mixed together, you can't measure the performance of yours individually, and you can't know exactly what is working or not working.

Not considering your defaults

An entrepreneur cannot have the false illusion that he will receive all the money he has sold. He is sure that he will have all this money next month, and he already plans what he is going to do with it. Therefore, to avoid being "in the hands" it is necessary to consider a default percentage. Given the above, having data, indicators, cash flow control, and reports makes it possible to get an idea of the default rate and thus can adjust to maintain the financial health of your cash.

Not using customer databases to your advantage

Nowadays there is a lot of money spent to attract customers, such as: good location, marketing both traditional and digital, product quality, customer experience, good customer service, among many others. Given this, this investment to bring your customers to your business is called CAC: Cost of Acquisition per Customer, so the customers that are already registered in your CRM have already been paid by you.

Therefore, the best thing to do is to make these customers more and more loyal, either with promotions, exclusives, among others. The customer you already have has a great buying potential. And the best thing to do is to make these customers more and more loyal, be it with promotions, exclusives, among others.

Visto isso, o cliente que você já tem, tem um grande potencial de compra. Portanto, se o seu CRM for mal administrado, você poderá pagar cada vez mais pelos seus clientes. Ter os dados do cliente, mas não usá-los para nada, é nada menos que: “jogar dinheiro fora”.

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