We all get into business because we want to address a need we have identified. We may have encountered a problem and the solutions available in the market do not work or we think we have much better solutions than the ones already there. It is always good to ensure that even as we start on the business, we test what we think the clients want by creating a product based on the solutions we have identified. Once we have the first working version of our product (minimum viable product), we can take it to market and take feedback. Many businesses end up with products that are different from what they initially started with because they implemented the feedback they got.

Despite the type of business you are in, you needs to understand the business, how you will make money and most importantly, how you shall collect the money. This calls for a clear identification of the business and economic model you are running and how applicable they are to the business needs. The aim of the business is to grow responsibly and be profitable.

Financial management has five distinct steps and they include:

1.     Understanding where you are: You cannot move unless you know your current position. So, looking at your financials and resources is important so that we plan accordingly;

2.     Capitalization:Knowing the capital you have access to and the various ways in which you can source this capital is key. Similarly, knowing the right time to get capital helps as getting the capital in too early may affect productivity and coming in late maybe too late;

3.     Resource allocation: We have competing needs knowing which project to undertake and when is key. One should look at the projects that have a high return and at the same time are easy and fast to implement and may have larger impact on the overall organization;

4.     Financial controls: We have seen many businesses go under due to what started as small leakages in the company. Knowing how to create systems to ensure sufficient control without choking innovation is key;

5.     Reporting and book keeping: Book keeping is important since it helps us analyze the past and use that as a stepping stone for growth into future. One should look at the best way to get the financials efficiently and look for systems that are easy to use and meets their expectations.

In order to get financial management right some things are important:

1.     Start early: The starting early is important as this helps create the system and the culture of discipline reducing the clean ups that needs to be done at a later stage.

2.     Involve professionals: Advice may seem expensive at the start but the cleanup later on maybe some of the most expensive costs that we shall have to do at a later date.

3.     Flexibility:Businesses should remain flexible to adopt to the new changes and they should have sufficient resources to take advantage of new opportunities.

4.     Measure what Matters: There are few things that will determine success in your business, identify those and keep an eye on those early on.

5.     Networks:Work on your networks and work your networks. Knowing where to get what you need in the most efficient manner is important.

All in all, we need to get our business finances well as this will enable us get our personal finances in order. Planning and discipline are key components of successful businesses and even wealth management. If you need help in your financial management for business or at personal reach out to us on info@elizabethnkukuu.com or on Tel0757600577

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