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How to work with finances when starting a business?

The idea of running a business always seems simple, doesn't it? At least in the beginning. Any aspiring entrepreneur with no experience might see it this way. We think it's a piece of cake. But there are always a lot of things that get forgotten.

You create an elaborate business plan, you plan year after year, and in the end there are a lot of new insights and countless mistakes. Which is fine, "you learn by making mistakes," right?


What should we not forget?

Time management and the need for paperwork!

Probably no one initially sees running a business as paperwork, paperwork, paperwork and more paperwork. Unfortunately, that is exactly the reality. There's no need to stress about it, you just have to reckon with it.

And what does time management have to do with paperwork? Setting aside time for paperwork and bureaucracy is a must. However, you have to manage your time in such a way that you can keep up with everything you need to do, but at the same time be able to delegate the things that can be done by someone else.

Don't burden yourself unnecessarily with things you know you are not good at. Leave those areas of your business to someone else. Surely there is someone who can do it better and faster.

Since childhood, we tend to dwell on things we're not good at. And why is that? So we can improve them. But if you can do what you excel at, why spend your time on what you're not good at or don't enjoy? Well, simply delegate as soon as your finances allow.

Don't forget about cash flow!

Cash flow is not just a buzzword we should be allergic to. It is pretty much the most essential part of any business. Generally speaking, cash flow is the difference between income and expenses that ensures stable operations even when unexpected costs arise.

Whether you are financing operations and development from your own funds or using business loans, it is always good to have some kind of reserve that you just wouldn't touch.

What do you need cash flow for?

  • Sudden expenses and accidents or broken machinery/vehicles

  • Inventory or fresh goods

  • New market development opportunities (Purchase of new equipment, opening a new branch, expanding the range of products or simply expanding the business)

  • Marketing and promotional expenses (textbook examples in marketing books state that 40-60% of earnings should go back into promotion)


What are the solutions for operational financing?

Sudden expenses and operating costs beyond expectations should be anticipated and not left to the last minute. Particularly if your business is growing, sometimes higher expenses for goods, new staff or production machinery are needed.

Imagine you have had a successful year and, in the new year, you have higher utility costs, so suddenly you need more operating funds to keep your growth going. You have your own money for operations, but these unexpected expenses? Operational financing can cover this and you can conveniently include the costs in your margin.

If you deal with this as late as the situation arises, then...

An operational loan from a bank is unlikely to be given to you. The whole process is lengthy and the credit rating is based on official statements and tax returns. The data from such documents is outdated and does not reflect the real state of your business.

Unlike bank loans, Flowpay offers a solution that is based on your real sales and cost data. You provide this data to us through the platforms you use. These can be POS systems, Payment Gateways or E-commerce Platforms.

This data makes it easy for us to know if the business is able to repay. We can therefore offer a profitable solution that only needs to go through a short approval process. The company is then able to repeatedly draw external financing online and without the need for lengthy paperwork.

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