Reducing Financial and Emotional Strain for Entrepreneurs
As Entrepreneurs, we all go into business with ideas of making money, working with great people and influencing clients to purchase our goods or services. The pitfalls of reduced cash flow, within our business are often over-looked but can have a big impact on how we deal with our business on a mental and emotional level.
Business Strain
Bad debtors with poor credit and possible cash flow challenges of their own can severely affect the cycle of money within our businesses. Credit terms and policies play a large part in being able to categorize our customers, what terms we give them and the expectations we have in meeting their financial obligations to us.
Some profitable businesses have required insolvency practitioners because a few bad debtors have been allowed to slip under the radar, causing severely reduced cash flow and placing owners in a position of not being able to pay suppliers.
Mental Strain
Without an affective Accounts Receivable department and great staff in place, the business owner is left with the aggravation of chasing bad debtors.
Some business owners have large blocks, in terms of asking for money or bad business boundaries where they allow customers to take advantage of their generosity.
Running a small business can, at times, be a large mental strain when your cashflow is reduced. It affects your ability to pay suppliers, your staff and your outgoing costs.
By having trained staff in place, you can dramatically reduce your mental strain and concentrate on other areas of your business, like marketing and generating more sales.
Emotional Drain
It is critical while in small business to take time out each day, to refocus and re- group.
The unseen emotional strain of
- Providing for your family financially
- Being successful to ensure your staff can take care of their families
- Possibly having little or no money to pay yourself due to severely reduced cash flow
can keep you up at night, cause physical stressors (Headaches, migraines) and prevent you from thinking clearly.
Some simple strategies to help you re-focus could be:
Go for a walk – get out from your working environment
Get up and move, put on your favourite music and give yourself a shake
Phone a friend, fellow business owner or your coach and talk through your challenges
The message is quite simple for keeping cash moving in your business and preventing unnecessary strain:
- Have rock solid credit terms in place for all your customers
- Hire the best staff to manage your Accounts Receivable department
- Establish clear business boundaries
- Take care of your physical, mental and emotional health
- If in doubt, ask someone for help – find a mentor!