Owning your own fashion business can get pretty chaotic. In the wake of all the chaos, your financial goals can get lost. That’s why at the start of this New Year, it is imperative that you set financial goals for yourself to not only improve but push your brand to new lengths.
Last week we helped you create your 2015 Financial Plan checklist. Now we’re going to talk about simple actions that can help improve your brand’s financial health for the rest of the year.
Set Up Specific Financial Goals
You want to write and plan out specific financial goals for your business. Do you want your revenue to reach $20,000 by August? Do you want to have a certain amount in a 401K? Do you want enough to buy a studio? Don’t be afraid to make BIG goals but remember to always map out gradual steps of how you are going to achieve them. Whatever your financial visions are…write it out, map it out, and try as hard as you can to stick to your plan.
Create a Spending Plan and Track It
Many people are spending more than they earn. When you own your own business and are not receiving additional financing, this can get quite difficult. It is important to create a spending plan so you can view and decide how you are spending your income. It is astonishing how much you will realize when you map out every dollar you spend and where; it can clarify where you can cut spending. The key here is staying on track of it. Don’t do it one month then skip the next three, the more you are looking at your finances, the better you will handle your cash.
Carefully Allocate Any Additional Income
You may be in a position to receive tax return or maybe the holiday season was an exceptionally prosperous one for you this year. Whatever it is, if you find yourself with additional business income, don’t go and blow it all in one place. Try to put some aside to save, some to put into your business, and some to buy yourself a nice little gift (shoes always seem to do the trick, for me). This will rid you of any guilt that you may feel you’ve overspent and it will also be helping your business’ financial health.
Improve Your Credit
If your credit is suffering, it’s time to find new ways to get your score back up. If you ever decide to look for additional financing for your brand, this will be crucial. Not to mention even when you want to apply for a personal credit card, this will also be crucial. Make sure you’re paying your bills on time and not overcharging more than you can chew.
Research What Credit Path You Want to Take
There are SO many different types of credit cards, it’s too easy to get lost in the options (or create the illusion of unlimited funds). If you need to get a new card, make sure you research which one is really right for you. Choose a card with a low interest rate if you know you’re going to have an outstanding balance. If you want to travel for work, choose a card that offers travel perks or insurance.
Make It a Priority to Pay Off Debt
Nothing hurts more than feeling like you’re swimming in debt. To avoid that, make sure your spending plan incorporates allocation to debt repayments. The steadier and sooner you pay off the debt, the quicker you will have more free income to start new projects. It also improves your credit history. Keeping in mind big goals, such a brick-and-mortar store, studio, or overseas sourcing trip will push you to stay on track.
Save, Save, Save
We can never ever stress this enough and it’s pretty much self-explanatory. Calculate an amount that you want to save per week or per month and make sure you always put that amount away before you do anything else with your income. When the numbers start growing, you’ll be happy you did.
It’s Okay to Say No
Party in the Hamptons? Expensive group dinners? It’s okay to tell your friends no, that you can’t go. It’s safe to say, going out can rack up some high bills that — if you want to invest in your business – aren’t too helpful. Even if you try to convince yourself that you will go out and not spend that much money, unless you have superperson will power, you will most likely throw more dollars than you expected. Don’t feel bad about saying no, your friends will understand and in the long run, it will help your business grow.
Plan Weekly Meals
Oh, how food can get us in so much trouble. If you’ve ever looked at your bank statement after buying lunch every day, you know what we’re talking about. You can rack up a big bill eating out daily, which tends to happen if your office or studio is not a home-based one. Be aware of what you’re spending on meals and coffees and start bringing from home, instead.
Give Back in a Non-Financial Way
You may feel because your finances are bootstrapped you can’t give back to the community—false. There are many non-financial ways to give back. Volunteering, donating clothes or toys to a shelter, mentoring a child in need are just some of the ways you can give and not worry about the money you’re spending.
Resist Constant Indulgences
If you haven’t noticed, sometimes when you start indulging yourself with two or three things it becomes a habit and gets very hard to stop. A couple of things here or there can become a lot of things every week and that could be detrimental to your business’ financial health. Make sure you are carefully indulging in things you really want or need.
But please, Treat Yo’self
I know we just said don’t constantly indulge but that doesn’t mean you don’t deserve a treat! Rewarding yourself with something makes all the hard work seem worth it. It doesn’t have to be a large financially-straining reward. It can be as simple as a long brunch with friends where you order steak and eggs and a croissant with a latte and a mimosa — instead of the short stack of plain pancakes sans bacon and a regular coffee that you normally get. Pick something you really love and treat yourself.
Planning weekly meals is a good tip! I think we get so wound up with the major stuff that we forget the minor stuff. IT’s all necessary, but we don’t feel that eating is working. Great post!
Really interesting and useful article about how to save money for Long term projects. It’s get tough on a daily basis to remember where to spend and where to save money. Thank you!