Spend Wisely When Starting an Internet Business
Starting a new internet business is certainly an exciting time. You are filled with the energy and excitement of a child entering a toy store. This passion is no doubt a wonderful thing. One can only hope to have that feeling each and every day that they run their business. However, this feeling not always accompanied by the most logical business decisions.
I have noticed that people tend to get caught up in the excitement and forget that the goal of their business is to make money! They buy anything and everything all at once - a new computer, new office furniture, rent large office spaces, etc. This careless spending can put their business in the hole for years to come.
I know it seems obvious, but not everyone is always thinking that Revenue - Expenses = Net Income. Your focus should be on getting the Net Income as high as possible. Managing expenses is just as important as making revenue. You can make all the money in the world, but if your expenses still exceed that, you are losing money. Every dollar spent is a dollar that you need to overcome to make a profit.
It helps to take a step back and think about what you really need. As an entrepreneur, you are likely strapped for cash and you need to make everything you have work to your advantage. The more money you spend on accommodating yourself, the less you will be able to spend accommodating your customers. Do you need a new computer? Or can you get by with the one you've got. Do you need new office furniture? Or can you buy used or get by with what you've already got. Do you need to get tied in to an expensive lease by renting office space? Or can you work out of your basement for a while. The more money you save, the more you will make. Not to mention, you will be able to make much wiser decisions on what you do and don't need after running the business for a while.
Enjoy the thrill of starting your new business, it's an amazing feeling. Just don't let it compromise your success before you get started. As the saying goes, a penny saved is a penny earned!
I have noticed that people tend to get caught up in the excitement and forget that the goal of their business is to make money! They buy anything and everything all at once - a new computer, new office furniture, rent large office spaces, etc. This careless spending can put their business in the hole for years to come.
I know it seems obvious, but not everyone is always thinking that Revenue - Expenses = Net Income. Your focus should be on getting the Net Income as high as possible. Managing expenses is just as important as making revenue. You can make all the money in the world, but if your expenses still exceed that, you are losing money. Every dollar spent is a dollar that you need to overcome to make a profit.
It helps to take a step back and think about what you really need. As an entrepreneur, you are likely strapped for cash and you need to make everything you have work to your advantage. The more money you spend on accommodating yourself, the less you will be able to spend accommodating your customers. Do you need a new computer? Or can you get by with the one you've got. Do you need new office furniture? Or can you buy used or get by with what you've already got. Do you need to get tied in to an expensive lease by renting office space? Or can you work out of your basement for a while. The more money you save, the more you will make. Not to mention, you will be able to make much wiser decisions on what you do and don't need after running the business for a while.
Enjoy the thrill of starting your new business, it's an amazing feeling. Just don't let it compromise your success before you get started. As the saying goes, a penny saved is a penny earned!
posted by Adam McFarland at
12/19/2005 07:45:00 PM
Links to this post:
Create a Link
<< Home