10 Profitable Business Principles
Success in business begins with discipline. Here are nine basic business principles (and a bonus one) that will help you establish a growing and productive business:
#1. “Draw a line around your business.” Keeping your business separate from your personal will enable you to clearly see where your business is succeeding and where you need to make changes.
#2. Know your costs. Many small business owners don’t know the cost of their product or service and subsequently, don’t know their break-even. This is critical in budgeting and operational planning.
#3. Manage from your financial statements (not your checkbook.) Although cashflow demands your attention, it’s your income statement that is the measure of your business’s performance. The balance sheet documents your businesses health and the status of its current worth.
#4. Orient your business toward profit, not lowering taxes. You went into business to make a profit, make sure your strategic decisions are aligned with growing your business, long term.
#5. Establish simple, teachable processes. This will enable you to work on your business (not in it), positioning you to provide vision, direction & strategic management.
#6. Purposed, regular giving that is aligned with your company’s vision. Successful owners are always giving back. Finding a church, mission or charitable organization whose mission complements yours and give regularly.
#7. Disciplined regular withdrawals from the business. Since most small businesses begin as a sole proprietorship or a single member LLC, the owner will be taking money out of the business to meet household expenses. These withdrawals are best managed as set, weekly occurrences.
#8. Treat your employees as partners. When your employees improve your business, reward them. If they save you money, give them a piece of the savings. It will change their focus from working for the business to working in.
#9. Prepare your fields for rain. If you’re interested in increasing your sales — the question becomes “Do you have the infrastructure to handle more orders?”
#10 (Bonus) Never let your business become more important than your family. No one ever wishes on their deathbed that they had spent more time in the office.
At Cepa Bookkeeping Association accounting service. We can aid your businesses stay on top of bookkeeping so you can stay on top of your business! It is like having your own accounting department for your professional business.
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