Pinoy Business Coach

One of the great things about starting a business is the unlimited possibilities that abound.  With limited capital and a lot of imagination, education and experience, one can be able to start small, work hard and finish strong. There is no scientific and proven method that would pave the path to growing a business but there are "hints" and clues that successful entrepreneurs have left behind for us to follow.

When you are just starting out, the most basic advice we can give you is to : START SMALL.  Practice with a little and continue until you are more confident and your psychological wallet continues to grow together with your experience as an Entrepreneur.  Here is a practical list of some DOs and DONTs when starting a business.

1. DON'T LET THE AMOUNT IN YOUR HANDS DETERMINE YOUR DESTINY
It is not the size of the capital that matters but it is what you do with it. Others wait until they have grand capital before starting a business only to lose it all tomorrow.  See all those winning boxers before Manny Pacquiao, they all made "puto" after hanging the gloves.  Let the truth be told, CAPITAL is USELESS without CASHFLOW MANAGEMENT.  And this valuable skill is only attained through time and experience.

2. DON'T QUIT YOUR JOB YET..
Many tempted with the mere fact that they would no longer have bosses to hound them think of quitting their jobs too soon.  Do consider working at your day job which does help pay the bills and put food on the table while starting a part-time business.  It is what you do in your spare time that will determine your business success.

3. DON'T LET THE BUSINESS SUPPORT YOUR LIFESTYLE
This is also a recipe for "puto." Not having enough financial literacy will place you in an awkward situation where you will not know the difference between GROSS INCOME and NET INCOME or the difference between GROSS SALES and NET INCOME (fatay ka). Thinking that sales is income, the inexperienced business person sets out to buy unnecessary things and will draw funds from the business to support a lifestyle which in turn eats up the revolving capital of the business.

4. DO TAKE OUT A SALARY- if the business can afford it
Rather than letting the business support your lifestyle, it is best to rather take out a modest salary, if and only if the business can afford it.  Chances are if you are still starting out then you might have to work for free. After-all it is your business and you will learn the fundamentals of cash flow management by working for free and progressing to taking out a modest salary when the business is able to increase its bottom line.

5. DO LEARN TO PROJECT CASH NEEDS
The primary skill here is to learn how to raise cash.  If you can borrow money before you need it then do it.  Learn to project payables and expenses and know your cash position on a regular basis.  This vital skill alone when practiced will ensure the high probability of success of any business.  This is out of the box capital raising and with these ideas, a business can gain the confidence to grow and expand.

6. DON'T BE AFRAID TO LEGALIZE
While being at business school, I encountered a cotton-candy maker on the streets while trying to interview small business people and he described that he was doing this for the past 15 years or so.  Staying small is also a problem and part of growing as a business person involves legalizing your business.

7. DON'T LET THE MONEY GET TO YOUR HEAD
When through time and experience, you eventually make it big.  Don't let the money get to your head.  Money is just a score board and the basic element of your financial mind.   Again, it all boils down to your emotional intelligence.

Again, these are just suggestions and no person should treat this as professional advice, ok? See you next issue.