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5 Online Business Mistakes in Managing Financial Management

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5 Online Business Mistakes in Managing Financial Management

Online Business Mistakes - Not all online business people know how to manage finances. In fact, good financial governance is the key to the future of the online business which is currently growing and becoming more competitive.

 

If you begin to experience signs of failure in your business, for example, a decrease in sales or a decrease in profits, there could be mistakes in the financial management of your online business. What are the financial mistakes in online business management? Check out the reviews below.

 

Mixing Personal Money And Business Money

In the business world, mixing personal money and business money is a fatal mistake. This is usually done by online business owners who are beginners. Not separating personal money from business money will cause the business to go nowhere. Because if at any time sales have decreased, the owner will make up the shortfall with personal money.

 

Conversely, the mixing of assets can also cause business owners to take business money for personal gain. Even though business money is needed for further capital expenditures and to develop a business. This of course will be bad for the continuity of your online business. So, as much as possible avoid the habit of mixing this two money.

 

Lack of Detailed Business Transaction Recording

One of the basic keys of online business financial management is good transaction recording. How can you know the development of your own online business if every transaction is not recorded regularly? 

From now on, you can make monthly financial reports. This is very important so that you can see the development of your online business, whether the graph is increasing or decreasing.

 

Currently, there are still many online businesses that are lazy to record their financial reports every month. If you want to avoid the threat of bankruptcy, then record detailed and detailed financial reports. 

Also, stop the habit of often procrastinating recording the transactions that you have done. Immediately record every online business transaction that occurs in a journal so you don't forget. To make it easier for you, use Accurate Accounting software that can help record daily invoices. This way, your invoice data can be stored neatly and systematically.

 

There is no financial budget structure

All online business owners expect their business to survive and grow rapidly. So, a clear and detailed financial budget structure must be made and implemented. If an online business is run without a clear budget, then you will be confused about where the money will be spent and for what items the money will be spent. By making a definite financial budget, you will find out how much capital is needed.

 

You can also see how much operational costs are, how much money must be set aside for savings, and others. This will make your business finances more closely monitored. In addition, do not be easily tempted to buy items that are not needed for your online business.

 Because the budget has been prepared, use it and obey it as best you can. Also set aside a special budget for unexpected expenses that are needed at times to smooth the production and distribution of your business.

 

The Loan Is Too Big

If you need an additional loan at the bank to develop an online business, avoid the habit of borrowing large amounts of money and more than necessary.

 

Because the larger the loan, the greater the interest per month that must be paid. Likewise, the origination fee required to process your loan at the bank. The more funds you borrow, the bigger the origination fee, which is usually taken as much as 4% of the loan amount.

 

Arrange the books in such a way that the balance sheet is balanced. Always remember that money is the driving force of your business. Do not let mistakes in financial management cause the results are not what you expected.

 

Does not review financial reports

There are already records of business transactions and financial reports but are lazy to review them? This would be tantamount to no financial statements. How can you monitor the development of your online business if you don't see the business transaction records?

 

Reviewing the financial statements will make you understand and understand which parts still need to be improved and developed again. Evaluate and continue to explore new ideas to grow your online business.

 

Smart financial management and good financial management are vital. Don't be reluctant to continue learning about financial science because nowadays the times are constantly evolving. Keep updating with financial science. In addition, reading more books, blogs, seminars, and workshops can also help.

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