#MoneyManagement: The Areas Where Businesses Make A Loss

Business owners often feel as if their money goes out faster than it comes in. Usually, this is the case because the company is like a sieve. Sure, there are areas which are strong and make a tonne of cash. But, some sectors are just as weak and hemorrhage money like a property with a draft problem.
The solution is to tighten up the problem areas as soon as possible, yet this isn’t possible if you don’t know where to look. Here are the four problem parts which affect almost every business.

Let’s start with the biggest culprit. To make money, the business has to buy and sell materials. Whether you are a manufacturer, there are certain resources which are essential. As a result, a supply chain is born which encompasses the management of the flow of materials. Sadly, a company’s supply chain often loses money because it isn’t efficient enough. To begin with, the right people aren’t in charge, so there is a mismanagement issue which requires logistics consultants to fix. Also, there is too much for one person to handle, and this is where tech comes in handy. 

A regular person might not think this is the case, but customers are savvy with free trials. Because they have had a bad experience before, they tend not to let it happen again. So, it isn’t uncommon for a person to take up an offer of a free trial only to unsubscribe. Instead of letting it renew, they use it for the 30 day period and bounce when you begin to charge. Of course, a free trial is an excellent way to generate new leads, especially if the service is spot on. However, companies have to be aware of the cost and compare it to the number of people they bring on board.

It doesn’t matter whether you are Elon Musk or Warren Buffett because everyone has to deal with a late fee. However, there are the ones the company can face and others that are damaging. Quite simply, an average small business can’t afford to fork out money they don’t have, no matter how “insignificant.” A couple of pounds here and there doesn't seem like a big deal, yet it adds up in the end. For owners who aren’t mathematically savvy, an accountant will take up the slack. Even a bookkeeper can make a massive difference as long as there is an element of organisation. 

Businesses want their money and they want it sharpish. So, it’s odd that lots of organisations let bills pass under the radar. Yep, plenty of SMEs are guilty of this offence, and it’s because they can’t be bothered with the hassle. After a couple of phone calls, they leave it and focus on the next payment. When someone uses a service, they must pay. There is a reason big firms won’t let arrears pass and it’s because they want their pound of flesh. Some even go to court to prove a point.
If these sound familiar, it’s time to do something to stop the mismanagement of funds.