Now he who supplies seed to the sower and bread for food will also supply and increase your store of seed and will enlarge the harvest of your righteousness.
- 2 Corinthians 9:10
It’s not rocket science. Money as a specific purpose in business and not knowing or understand how to use our money will cause our business to fail. A farmer understands this principle very well. Some money is essential to buy seed. Without seed he will have to crop and without a crop he will have no money and without money he will have no food. He understands that it would be foolishness to use the money that is intended to buy seed, to buy food. You do not eat your seed. It’s plain and obvious. Some money is supposed to be spend on seed and other money is intended to buy food. If you eat your seed then your business will fail within this very first season.
This is where most business owners go wrong. They don’t understand the difference between seed and food. They try eating the seed or sowing the food – neither works! There is a time to sow your money so that you get a good crop and there is a time to eat your food. Using your money in the wrong place or at the wrong time will get you nowhere.
So, aside from the farmer metaphor, how does this apply to business? Our money has a specific purpose in the same way that a farmer’s seed has a purpose. If you do not sow your seed you cannot expect a harvest. The same applies to business, if you do not sow your money in the right place you cannot expect your business to grow and flourish. Too many business owners expect to draw a salary within the first year of business. Some do manage to draw a salary but if they do their business never grows into anything more than a hand to mouth small business. The wiser way to do things is to find a ways to live without depending on your business in the first year or two and then use your money to sow so that you business grows sufficiently before you start to draw a salary. Although this might seem difficult it will offer you greater financial freedom in the long run.
Ideal areas to sow your money into in the first year:
Saving
The best time to start saving is right at the start. When you get your first money into the bank allocate at least ten percent of it to a savings account. Not only is this a fantastic habit to develop but it also makes perfect sense. Savings should come when you have enough but to save but because you don’t know how much money you will have in the near future. Your savings could be the very thing that keeps your business going when other businesses are failing. Put aside a portion every time you get any money.
The wise have wealth and luxury, but fools spend whatever they get.
- Proverbs 21:20
NEVER use your money right down to the last penny – leave a buffer.
Charity
I call it charity so that it encompasses all forms of generous giving. Believe it or not, being generous and giving away a portion of your money is an essential part of business success. Everyone loves a generous person and the quickest way to gain favour in this world is to be generous with what you earn. As a Christian, it is essential that we don’t hold onto our money. We must be wise stewards but we must also be faithful givers. I firmly believe in giving tithes and offers as well as other acts of financial generosity. How you calculate what you give is entirely up to you but I recommend starting with 10% to your local church. Let your tithe be essential followed by all other sorts of giving. You cannot sow and not reap – so start sowing as soon as you have something to sow and a bountiful harvest will come back to you in season.
Advertising and Marketing
Marketing doesn’t need to cost a lot but without marketing how is anyone going to know that your business exists. Before you allocate your money to all sorts of things make sure that you have a good marketing budget. Here are some suggestions for where to spend your marketing budget:
- Facebook Boosts: Experiment with paying to boost some of your posts.
- Google Ads: Spending a small portion could be useful
- Post Cards: Fatflyers offer 5000 quality promo cards for £99 including VAT
- Business Directory: Depending on your business, it might be good to advertise in your local business directory that is put through letter boxes.
These are my top three suggestions. I would suggest that you keep all other expenses as small as possible until you can justify the expense.
Keeping Records
Another very important part of understanding money is to understand where it comes from and where it goes to. Your financial records are essential for your business success. Make sure that you account for every penny and record it in way that is easy for you to understand. Create graphs and charts if it helps but do whatever it takes to create a clear picture of where your money has come from and where it goes to. Once you know what is working do more of it and when you see something that is not working stop doing it. Your financial records will quickly give you an indication of what is working and what is not. Make sure you keep a separate bank account for business money too. There is no wisdom in running your business out of your personal bank account.
Managing Mindsets
The biggest and most important part of understand money is to understand who is boss. If you can master this then you will always be free. Most people are ruled but money which is why they worry so much. They live to make more money to find more security. However, if you can turn the tables and get your mind to realise that it is boss and not your money then you will always be free and will seldom have anything to worry about. I have managed to achieve this mindset but asking myself an important question every time I worried. The question is, “What is the worst that can happen?” Each and every time after asking this question I realised that my fear related to money was irrational. I quickly learned that there is nothing so bad that can happen if I don’t have enough money and the chances of me not having enough money are minimal. It’s not ever as bad as it seems and even losing everything is not as dramatic as it seems. I hope you never experience that but even if you do it might just be the making of you. I have lost everything several times and have no regrets – it actually taught me some of the most valuable lessons I have even learned. Money is no longer my boss, I do not work for it, it works for me and I am the boss! Entrepreneurs who understand this are the ones who get money to do the most for them.
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