The secrets of women entrepreneurs to have good finances

June
16, 2021

5 min read

Opinions expressed by Entrepreneur contributors are their own.

Women entrepreneurs have diverse doubts in everything that finances represent, from the business scheme to the personnel. Sometimes it is considered that they are indeed differentiated, but other times, they are thought to be the same. The reality is that strengthening women’s empowerment is one of the keys to boosting their economic and personal potential.

According to data from the World Bank’s MSME Finance Gap, the lack of financial inclusion of women has a negative impact on the companies they lead as there is a financing gap of 92 billion dollars for micro, small and medium-sized female companies .

“We need to lose the fear of getting involved in our business numbers. Many times just to hear the concept ‘ Finance ‘. The first thought is a ‘it’s not for me, I don’t know what is related to numbers’. Finances consist of keeping a good control and a ‘diary’ of what is happening in our business in a numerical way. The reality is that, with less financial stress, better decisions will be made in the short, medium and long term. In other words, by knowing the financial situation of our business we have greater flexibility and opportunity to make assertive decisions, instead of reactive ones ”, explained Ana Paula Deleze, Finance Director at Victoria147 .

We know that female talent lives valuable lessons in economic matters. It also requires clearing some doubts about money and business. Based on experience, we prepared three recommendations to find the light at the end of the tunnel of figures.

1. Allocate a salary, the first step to success

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Yours is mine and mine is yours, it does not apply in business. The first recommendation is to have separate accounts, a personal one and a business account.

Given this, it is vital to establish a salary for the work that is carried out At the beginning of the venture it is complicated and probably will not be the ideal, but it is part of the process and evolution of the project. Regardless of whether you can pay the ideal salary, you must establish what that amount would be, as well as set goals and objectives, to achieve it little by little.

If you do not separate the personal accounts from the business, it is very easy for it to get out of control, for you to start spending more personally than you have or owe. The worst thing is that your business never has the ability to be profitable.

Failure to do so is very likely to face the following consequences:

• Business profits dedicated to personal matters.
• Business cost coverage with your own savings.

2. Analyze the expense, the cost and the price, it is easier than it seems

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To have control of finances you need to constantly review the details, so as not to lose sight of any. Even avoid hiding them, we do not want any details to escape.

By identifying all variable costs and fixed expenses, you can classify them and calculate the sale price of your products or services. In addition, by having a mapping of your market, you will be able to check if their consumption habits make sense to them, but if you define it wrong at first, it will be difficult for you to change it later, you may lose credibility with your customers.

Finance will give you information about the status of your business and help you make better decisions. Whether they give you light when estimating the ideal period of time to hire a new person or, knowing when it is more convenient to invest, create new sales strategies, among others.

3. Take charge of money

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Don’t leave your business finances in the hands of someone else. It is very common that by beliefs such as “I’m not good at numbers”, we leave total control to outsiders, such as the person in charge of accounting. Therefore, it is important for women entrepreneurs to know in detail how much money they are generating (income) and how much they are spending each month, therefore, to know what their utility is.

In this way, strategic decisions can be made and the risk of poor control or use of business resources minimized. At the same time, new professional and personal skills can be developed for women who work in different fields.