Stop Embezzling From Your Business: 5 Keys to Create a Thriving Business with Cash Flow--Darnyelle A. Jervey

One of the challenges I see frequently when meeting with solo-entrepreneurs who have been in business 0-5 years and are trying to build a solid business, is an inability to ensure that they get to keep a significant amount of the money that they earn. Most people who start a business fail to understand the significance of creating and managing a budget, largely because they don’t have a budget in their personal lives. I’ve heard it said recently that “how you do money is how you do everything.”

Typically new entrepreneurs earn and spend, sometimes without ever letting the money they earn get appropriated to their business account. Did you catch that? Yes, I am talking about embezzling from your business. Sadly, most entrepreneurs do not have a business background and often start their business out of necessity, lacking the skills, strategies and solutions to ensure that they are building a thriving enterprise. Most people live in a “feast or famine” environment or worst yet, they live from paycheck to paycheck or what I call “poor-check to poor-check” completely captive to their business and clients instead of being able to allow abundance to flow in all they do.

When this is the way you run your business, you are likely to never gain the freedom to enjoy what you love. In my opinion, that completely defeats the purpose of becoming an entrepreneur. If you’re going to be a slave to your work, you might as well keep working a job. If this makes your stomach curl, then you’ve got to get a handle on your money so that you can ensure you never have to sit behind someone else’s desk ever again.

If you want to stop embezzling from your business, you have to change your mindset. Keep in mind that with business comes boundaries. If your business is considered a business on your deepest levels, you will respond accordingly. It will also take discipline. That means, you will have to stop taking cash out of your business before it enters your bank account. While I am happy to suggest that you pay yourself, I do recommend that you pay yourself in an authentic fashion, via your business checking account, so that you have a record of the salary you are paying yourself.

I am happy to report that as soon as you shift your mindset and you also create a few key financial systems in your business, you can go from surviving to thriving in your business. When you’re no longer focusing on the lack present in your business, you can actually attract more paying clients because your energy will be flowing in abundance and circulation instead of in lack and stagnation.

I believe that since you started a business to make money, you should create effective systems so that what you make doesn’t get embezzled by poor financial management habits. While I am not a financial advisor, I am a business coach and I am able to show my clients how to create foundational financial management for their business, a consistent strategy as they endeavor to grow their business. I also recommend that you consult a financial advisor that specializes in working with entrepreneurs so that you can be sure to get a customized strategy that will increase cash flow and reduce stress as you endeavor to grow your business.

Here are 5 keys to create a thriving business with cash flow:

1. Know your numbers. You have to know what you are bringing in, what’s going out and what’s left over. You have to know the value of a new client to your bottom line and how many you plan to add in any given month.

2. Make a monthly financial plan for your business. Set a budget for the expenses that you know are mandatory to the operations of your business for the current month. In your plan, highlight the amount of revenue you have coming in before you do anything to attract new clients. Also track the amount of expenses you have going out so that you know what your cash flow is.

3. Create a strategy to attract enough new clients to handle all of the expenses you already have in your business. As an example, if you need $5,000 to run your business each month and you currently have $7,500 in your business checking account, which would mean you have $2,500 cash flow in your business. If you create a strategy to attract 3 new clients which are valued at $7,500, you will have $5,000 cash flow in your business when your month is done. With the extra cash flow, you can begin to save money by opening a business savings account and having money set aside for personal development such as hiring a business coach, other investments, expanding your team, etc.

4. Purchase financial management software such as QuickBooks to keep track of your expenses, income, invoicing and clients. The system is designed to make managing your businesses financial systems easier so that you can spend more time doing what you love, working with your clients.

5. Run your monthly reports by the 3rd business day of the new month so that you can see where you are and brainstorm how you can increase your results by a minimum of 10% in the new month.

Embezzlement is a serious offense. When you embezzle from your business, you minimize your ability to invest in yourself through your business when the need arises and you aren’t allowed to show up fully for your clients. By simply creating a budget and financial plan, you can reduce those inappropriate expenses and begin to allow your business to truly change lives.

©2011 by Darnyelle A. Jervey. All Rights Reserved. Darnyelle A. Jervey, The Incredible Factor Business Mentor and Coach, is the founder of IncredibleOneEnterprises.com and the Leverage Your Incredible Factor System® a proven step by step program for turning your passion into profit. For more information and a FREE audio CD "How to Use Your Incredible Factor to Attract MORE Ideal Clients" visit http://www.incredibleoneenterprises.com.