Money makes the world go around! If you are in business you know that money is needed, but why do you need it?
Money Is The Life Blood Of Business
Not many businesses can run without money. It is the life blood of your business. Without money there is a lot you cannot accomplish and that can really hold you back. So if someone says “I don’t do it for the money”, it’s probably because they already have lots of money!
Below are some good reasons why you DO need money to run a successful business.
Not many businesses can survive without marketing themselves. Sure there are ways to do some free marketing, but most of the ways to do free marketing take lots of time, don’t work really well, or you can get lucky with a viral video.
Most effective marketing costs money! Some people think social media marketing is free yet. That is far from the truth social media marketing costs money for ads and for paying people for their time to run effective social media marketing campaigns. Newspaper ads cost money, Yellow Page ads cost money, online ads cost money, radio ads cost money! I could keep going, but I think you get the point. If you really want to keep growing then you need money for a marketing budget. Free marketing will only get you so far. Since I’m in social media marketing let me tell you again “Social media marketing is not free!” It will cost you money or lots of time so remember that when you tell someone that you can just do some free social media marketing, cause any experienced marketer will laugh out loud. (literally)
Equipment and Tools
Most businesses need some sort of equipment or tools to operate. Whether it is digital marketing tools, computers, printers, social media marketing tools, heavy equipment for industrial work, cash registers, displays for retail, or tools of the trade for other industries most of that costs money. Without the needed tools your business can’t operate or finish the jobs required.
If you employ people you definitely need money to pay them! Money is needed to pay employees on time. If you don’t have enough money then you can’t employ anybody to help with your businesses growth.
It’s OK if you are just a one person company. There is nothing wrong with that, but if that’s the case you must consider the fact that if something happens to you the business will suffer. If you were to get sick who will be around to keep your business going? Being a one person company is also like being a slave to the business. It can’t run without you so you cannot leave it alone for very long. That is just something to consider when planning your business structure.
Bookkeeping and Accounting
Your business will need to keep good records for Uncle Sam. This can be done by you without any extra money needed, but it will take up lots of your valuable time. So unless you are good at it or keep up with your businesses bookkeeping I suggest that you hire someone to do this for you. It will save you time and headaches in the long term. Knowing your businesses financials is very important. If you hire someone that can keep the financials up to date it will give you more data to look at to keep growing and to keep things in order.
Most businesses need some kind of insurance. It could be property insurance, car insurance, workers comp, liability insurance, etc. If you don’t need insurance now that is good, but eventually you will need some different kind of insurances to keep your business protected.
To Pay Yourself
This is a big one because I’ve heard business people say that you can’t pay yourself for awhile when running a business. That is crazy! I know that you can’t be taking out lots of money and spending it on this and that for yourself, but you need to eat, pay the bills, pay the rent/mortgage, gas for your vehicle, etc. If I did not have money to pay for those things I wouldn’t be able to concentrate on the business itself! I would be too worried about my personal bills and the bill collectors calling all the time to concentrate.
So yes you do need to pay yourself. Find a way to pay yourself while building your business because if you are worried about all your own bills it will kill your focus. I know this for a fact it has happened to me and it is horrible because when you lose focus because of personal bills it can really drain your energy! I’d rather know that at least my bills are paid so that I can concentrate on building and growing my business. Nothing beats peace of mind.
Building Business Credit
If you don’t have money it’s hard to get credit cards for your business. This will make it harder to build credit for your business for when you need more money in the future. Try to get at least one business credit card and pay it on time every month to start building your business credit.
As you can see there are plenty of reasons you need money to run your business. It really is the life blood of a business.
No, money is not everything, hopefully you are in business because you love what you do. Just remember that in order for your business to survive and grow you must have a good cash flow. Money is not something most business can live without for very long. If your business is not generating money yet then it isn’t a business. Not until you start generating some money to get the necessities your business needs to grow and keep growing.
Your business can survive without making money right now if you have funded the business yourself or with investor money, but the main point is to make money so that the business can support itself. Make a plan that will get you on track to generating money as soon as you can.
Go Get That Money!
Thanks for reading if you have anything to add just let me know in the comments below!
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