Your company's financial needs

 

Your company's financial needs are important more than you know

Photo by Marcos Miranda

The success of your company in your market against your competitors may depend primarily on creativity in research and development for example or on marketing acumen but then, so often getting the right people means paying the right money. 

If you're starting a business, you're likely to be enthusiastic and optimistic about the future of your company. after all, how many successful companies have been started by pessimists? 

But you should force yourself to be realistic when it comes to calculating your company's financial needs, follow this operating advice: 

1. Estimate sales(Revenue) conservatively, any business will want to be able to weather any market downturns, both expected and unexpected. 
2. Budget expenses generously, during the first few years of business. it's vital to monitor and control expenses because you're not likely to have much income to manage by budgeting generously, your company should have enough money to meet the unanticipated market condition, then if you spend less than budgeted, you can add to your reserves. 

Here's the bottom line: If you're realistic in your planning, then you have good reasons to be optimistic in your expectations. 

Get the formula right, and you're in business. 

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