You’ve been working hard to grow your business. We understand that it can be expensive to invest in yourself when you don’t have any available cash flow. In this week’s 10X Business Owner’s Mastermind Group video call, we advise direction and education to help you succeed more with your business and your money.
What are general business expenses?
Now you know that overhead expenses are the necessary operating expenses of your business and that your employees are technically an operating expense. While you want to invest in your business by growing, you don’t want to drown in a pile of money you can’t spend. A good general business expense is hiring out of a certain task.
“This is a great way to cut costs by asking your employees to do work that needs to be done without you, but still receive their full salary.” — Doug Rosenberg
Lazy people aren’t creative. Today, we tend to think we want to do the work ourselves. If you find yourself with a dead computer or lack of tools in your office, you’re probably not the only one. Do you really want to be the industry’s number one slave? What’s the point?
How do I figure out what my monthly expenses are?
This is the number that you need to reduce and put in your business budget. How do I know what to lower? This will depend on how far your business is from the corner. It’s easy to figure out which expenses will make the biggest difference and which you can simply eliminate.
Determining Your Goal: What is your goal? How much do you want to make? What’s the payback period? Your goal is going to dictate how much to cut. Ideally, you want to get to a point where you can live without it. That’s where you want to be. Let’s say you’re making $25,000 and want to start generating $150,000 in revenue and $15,000 in profits. At this point, your goal should be to cut all those expenses to reach your goal.
What are the biggest expenses for most businesses?
There are four general expenses that most businesses encounter, and we cover those, including a helpful tip on how to save money: General Expenses Insurance – this includes health, auto, property, and business liability insurance Business Loan – you should have some funds for business loans in case of emergencies and growth Purchasing – such as groceries or office supplies Professional Services – such as accounting, legal, business coaching, and other skill development Notice that all of these expenses should be to have a truly healthy business.
If you’re starting a business or need to be consistent in your finances, it might be wise to hire a Certified Financial Planner who specializes in working with small businesses to guide you through the process.
How do I get more money for a business?
Do I need to spend money on something to generate more? Yes. But how much more do I need? What should I spend it on? How much should I spend on it?
Conclusion
The most important thing to do as a business owner is to understand your general costs. Being aware of what you spend allows you to make better decisions about your cash flow. If you do not understand how your business operates, you will be unable to grow successfully.
By understanding your general costs, you will have a clear goal of what your business can and cannot do. If your goals are unmet, you can take steps to meet those goals better. If your goal is met, you can continue to improve your business without making costly investments that are not needed.
