Reprinted from original post here by industry professional Elizabeth Morris.
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In terms of your business, clients are important. I call them clients because customers are usually a once or twice occurrence whereas clients are ongoing. Clients are long term and that is the goal with any new client at your business.
You have a relationship with a client; you know their likes, their stories, and they make repeat appointments. Clients are the mainstay of your service.
The very next important item in your business is keeping track of your finances. This cannot be stressed enough. Knowing how much it takes to operate allows you to set prices that make sense both for you and your client.
However, keeping track of finances is not fun and it is not why we went into business in the first place. We love the art of what we do, and we enjoy providing a service which helps our clients feel beautiful. Having to track incoming and outgoing money is the drudgery of what we do, but it is vital to our success.
To make ourselves complete this non-desired task, we must force ourselves to develop a process. I call this process “tightening your boot straps.” This saying comes from tying your shoelaces tightly so that you can make a long walk. Without a strong understanding of the financial health of your business, you may last six, 12, 18 months, or maybe you’ll get lucky and last a bit longer. But your financial health starts at the beginning. Without this, it doesn’t matter how many clients you have. You’ll end up running out of money regardless.
Automating payments and deposits for your personal finances is a great first step. However, in terms of business it is all about keeping track of incoming money and expenses. It isn’t about saving money and being frugal, or never spending a dime. It is more about spending on the things you actually need and cutting costs on those that you don’t.
Most business owners don’t take the time to focus on what is very important to their success. If takes discipline to do the work initially, but once you have things set up, it will run more smoothly with less effort.
Take for instance your services. Deciding on a brand to use, using it with skill and fidelity, will gain your more clients than having the latest fad. In general being a true master of your craft is more powerful than slapping a bunch of nail art on a nail that isn’t well made to begin with. Some “extra” items make you money when approached the right way, like pre-making crystal clusters for when a client wants one.
Preparation like this makes it possible to supply what the customer wants without making a mess of your schedule, and it also helps you have better control over how much you use based on the price you charge.
Bottom line on your business finances is knowing how much it takes to run your business, being savvy about what you can offer and what works well, and being selective about the products you use.
Any well run business has the cost and profit of each service/product down to a science. They know exactly how much time it takes, how much it costs them to perform, and how much they need to charge to make a profit. You too need to be choosing what works well for you and at the same time makes money for your business.
There are many ways to do this, but I prefer the digital route. You can have your business appointments stored via a booking site and then incoming payments can be stored there as well. Using a reputable accountant is a great idea and they can help with taxes at the end of the year.
If you can use a program such as Quick Books, that will help keep track of all the money coming in and all the money going out, plus you’ll be able to categorize everything to see where you’re spending and earning. No matter the avenue, keeping tabs on the incoming and outgoing flow of money is of utmost importance.
Finances are one of those things that so many put off until tomorrow, set yourself apart by getting control of your money. You have worked hard to make the money, now make it work hard for you.
For more information contact me via email firstname.lastname@example.org . Looking for hands-on help with your business? That is one of my specialties.