Bookkeeping Blog Presents Big Pitfalls for Startup Businesses
It’s tough to make a startup business take off. There’s plenty to do and most of the time it’s up to the founder to do it all. Thanks to tight budget, lean inventory and plenty of responsibilities, it’s easy to see why many startup businesses fail within the first year. So what can you do to put all the best odds in your favor and put your startup of the path of success? Keep reading this bookkeeping blog for all the details!
Startup Business Pitfall #1: Not enough cash flow
As a small business owner, you’ll immediately realize that it’s important to have cash flow. Whether you sell product or set up your own practice, cash flow management skills are a must. In fact, 82% of small businesses fail because there’s no cash by their side.
When it comes to cash flow, there’s plenty to think about. For example, late payments from customers can have a detrimental effect on your operations. Especially, with big invoices. As a startup business, you’re counting on this money. You probably know exactly where to invest it from more inventory to paying your employees’ salaries. Seasonal fluctuations are another factor that can influence cash flow. Slower months can really make a difference in your bottom line and you have to be ready for that. Emergency expenses such as broken equipment or even flooding can reduce cash flow over night.
Startup Business Pitfall #2: Poor communications of what you do
Many startup owners do a bad job of explaining their products and services. For some it’s overdoing it and sharing information overload when all the clients care about is what’s in it for them. While for some, it’s more about not giving enough details or not representing their business in the best way. For example, every startup should have a website or a the very least an online address, perhaps a social media profile, where potential clients can get information or get in touch. The better the design, the better the way you describe your services, the better the success of your startup.
Startup Business Pitfall #3: Administrative tasks galore
Too much stuff to do, not enough time to do it is every startup business’ story. Since you’re trying to keep costs down, as the owner you’re doing it all. You take care of invoicing, payroll, scheduling not to mention the actual work. It’s plenty of paperwork that can be overwhelming. In fact, our Miami Beach bookkeeping company helps many clients handle their administrative duties, assisting them in keeping track of it all.