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Three Important Financial First Steps to Starting a Business

3 First Steps to Starting a Business: At Peace With Money

There are plenty of money myths to avoid when starting a business, but what are the right financial steps to take when starting out? It’s an important question to answer as you embark on your business beginnings! Today I’m sharing with you three important financial first steps to starting a business.

Save Up

Especially if you’re planning to quit your day job or make your business your primary income stream, it’s important to establish a savings cushion. Start with enough savings in the bank to keep you and your business afloat for 3-6 months. The time period you aim for is dependent on your comfort level with developing your business into a healthy income stream. Even if you’re planning to start your business as a side hustle, saving can be helpful. It may enable you to work less hours for your other income sources, or give you a little start up cash for initial business expenses.

Speaking of business expenses, keep them low. Don’t fall victim to the “you have to spend money to make money” myth. The lower you keep your business expenses, the closer you get to creating a supportive and financially sustainable business.

Know Your Why

Focus on your “money why” for starting your business. Like I discussed last week in my article on saving, having a purpose and a plan for the cash your business generates is very important! Have a plan for your Profit. What are you going to use it for?

Even if you’re starting a side hustle, have a purpose for that income. Avoid the urge to simply inflate your lifestyle. Knowing your “money why” will help keep you more focused on your business and make the profits feel more purposeful and rewarding.

Take it to the Bank

Open a bank account just for your business. Do some research on the best business banking options before you commit to an account. Taking advantage of a good banking offer can start your business off on the right foot!

3 First Steps to Starting a Business: At Peace With Money While you’re nailing down the banking details of your new business, make sure you also create a money system for yourself. Have a plan to pay off your expenses and also pay yourself. My recommendation, of course, is Profit First, which you can read more about here. If you’re considering starting a business, I highly recommend reading the first 5 chapters of the Profit First book, which you can download here on my site. If you find yourself intrigued, you can schedule a curiosity call with me to talk about Profit First and your business. You can also read my other articles on small businesses. A few that might be helpful are these ones on accounting for business expenses, invoicing your customers, and managing cash flow.

Wherever your business beginnings take you, I hope these three points help you take the first steps with confidence.

I first published this post over a year ago, but I thought August would be a good time to roll it out again, with our theme being transitions. If you have other business transition-related thoughts or questions, just let me know in the comments. I’d love to address them this month!

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Angela

Images: Brooke Lark

Are You Really Getting the Most From Craft Shows?

Craft fair season is on the horizon, and its important to make sure you’re aware of the financial implications of every show you attend. Certainly you want to calculate the cost of the craft show itself and how much you are selling, but that’s really just the beginning. Craft shows are a way to be face to face with your customers, which opens up a world of potential marketing, networking, and connection opportunities. Every element of your craft fair presence should be planned with the intention of getting the most business, exposure, and presence you possibly can. After all, you paid to be there – you might as well milk it!

Imagine the Possibilities

Begin to think about how you can use the even to your fullest advantage. Consider how you’re using the show from an advertising perspective. Are you advertising it ahead of time so that your fans come to see you? Once you’re at the craft show, are you using it as the advertising opportunity that it is? Are you collecting names for your mailing list ? Are you advertising your other upcoming events so customers and potential customers know where they can see you next? Are you letting them know how to buy from you online or at local shops? All of these pieces of information are important to convey to anyone who visits your booth. Think about the most clear, effective, and inviting ways you can disseminate this information. Maybe your need to tweak your display or create a small colorful flyer. Find a creative solution and make it happen.

Craft shows are also a time to be present with your customers, a rare experience these days. People often shop at craft fairs specifically to support local economies and meet makers face to face, so make sure you are giving people the experience they’re looking for. Be friendly, personable, and connect people. Use this in-person opportunity to its fullest extent. Perhaps you want to demonstrate how your handmade items are made – people love watching live demonstrations and learning more about a maker’s process. Tell the story behind your craft.

Get the Most From Craft Shows: At Peace With Money Especially if you are seeing return customers, ask for feedback on your work. Ask customers if there’s anything they wish you made. If you really want to have fun, maybe set up a poll or other interactive station where people can offer feedback or vote for their favorite product. Simply connecting with other people who live near you by talking about community happenings can make the difference! Craft shows are a great opportunity to really touch base with your customers and get to know them better in order to understand how you can deliver your product to them. The craft show is about connecting as well as making a profit, and those connections eventually pay off. Being friendly throughout the day will also likely improve your experience of the event, and your day to day life in your community.

I hope these tips will help you come up with more ways to get the most out of the craft fairs you attend this year. If you are interested in chatting about more creative ideas for promoting your business at craft fairs, don’t be afraid to shoot me a message! And of course, you can schedule a time to talk with me or check out the packages I offer if you feel you need more guidance.

☮

Angela

Image Sources: , Miroslava