Start ups are the new trend..Or at least we can say that the term has made it more attractive. People across all age groups have start ups. This trend has been growing, especially in India, at a rapid rate, for the past few years. Although the rate of growth has declined but in absolute values, the number of start ups are increasing each year. However, what’s interesting to know is that more than 50% of these start ups fail in their first four years of operation. Here, we are going to be talking about stat ups by individuals and not big firms.
About 82% of the start ups started by individuals are either self financed or use a majority of their finances from friends and relatives. This means that finances are limited. One of the many important reasons for failure of mot just start ups but also small businesses, is lack of Financial Management.
No matter how good your business idea is and how much finance you have to begin with, lack of financial management will drain your finances eventually and lead to failure. So here are a few ways small businesses can manage their finances well: