Smart Financial Planning For your Growing Business

What do they mean when they call someone ‘business-minded’? Does it mean the ability to sell? Or innovate? Or simply to have exciting new ideas?

Being business-minded means the ability to do more in less. In other words, adeptly managing finances. And while many would defer from financial planning as an individual, it is the key driving factor in financial planning.

As a start-up or a growing business, financial planning is imperative. This is because things may be smooth today, but unforeseen risks are very much a part of the game when you own a business. Small businesses are not privileged with huge cash reserves and that makes them vulnerable to uncertainties, especially in the long run. You can duck through a financial emergency today, but without a sound financial plan, your business is unlikely to survive in the long haul.

And thus, it is essential to have your fund management practices in place immediately after the commencement of your business. Once you are through the paperwork and on-boarding the investors, you will find it hard to take time out between managing your employees and delivering quality to clients before the deadline. The only way forward is to formulate critical strategies in planning expenses for your business to keep it up & running. So, here are some pointers to follow for an effective financial plan of one’s business.

Personal financial management

Individuals who have inculcated a habit of managing their expenses are better off in managing their business expenses proficiently. The better the business owner manages his finances, the more the resources will be available for their business. Without a sound personal savings habit, you may run into financial difficulties and need to apply for business loans online to get funding. While that may well be a necessity at some point in your business, you will still need to manage your expenses before managing your business expenses. To do so, you need to review your current finances for a better understanding of what needs to change.

Further, you should set the strategies for financial planning in line with the long-term or short-term goals for your business. Answering questions like Is there a need for more equipment? Does the business require expansion? How will the new strategy affect business cashflow? These answers will make the planning foolproof.

Smart savings habit

As a start-up of a small business venture, you would have a lot of due expenses along with the need to invest more in the business. About 26% of small business owners go without any salary or income from their business for 6 months to even a year. How much you have saved in the past will directly determine how long you can stay without any income from your business.

There are many ways to save cash for any emergency that may arise tomorrow. One way to save your income is to refinance existing debts. There are many refinance options available like no-closing cost refinance for mortgages which can help business owners to meet their short to long-term business objectives.

Personal Credit Score

The personal credit score of the entrepreneur is of utmost importance. The credit and outstanding debts of the entrepreneur play a pivotal role in obtaining business loans in India. If the credit score of the applicant is low, they may have to do with lower loan amounts & repayment period along with higher interest rates. Being up to date with your bill payments and repayments can help increase your credit score gradually. To learn more about this, visit

Business Cash Flow Management

Cash flow management is the process where businesses manage the inflow of money as per the outflow of the business. Cash flow management is not a one-off task, it is a month-by-month challenge that every business has to manage to effectively keep running. To ensure that your business keeps overseeing billing cycles, there has a well-defined business process for collecting revenues, book-keeping, and fixing the competitive pricing.

Sound business mapping practices helps small & medium-term businesses to identify their weaknesses and allocate resources to solve them. This practice will eventually help your business streamline revenues and expenses as well as inculcate the practice of effective knowledge management across your organization which will in turn offer a long-term durability.

  • Reduce overheads!

Overheads are the regular expenses incurred in running your day-to-day business needs. Overhead expenses do not contribute to your profits but cater to your auxiliary business costs. The lesser money you spend on regular expenses, the more you will save to invest in your business growth.

But how do you cut overhead expenses to invest more in your business? Again, strategically mapping your business costs can help identify all the surplus overheads which are support costs. Support costs include administrative costs, management wages, and monthly bills. Once you identify these support expenses, you can audit the inefficient costs that do not provide the desired benefits. You can then eliminate such inefficiencies by chalking out alternatives to such processes, you can then optimize every ounce spent for your business growth.

  • Financing your business

Every business requires funding, whether as a start-up or during the growth phase. This can be justified by the fact that 43% of small businesses in India applied for a business loan last year. Funding can be acquired through multiple means such as small business loans from banks, NBFCs, government schemes or pitching to angel investors, venture capitalists, crowdfunding schemes, peer-to-peer lending, etc. However, the choice of funding depends on the needs, viability, and scope of the business.

Today, one can avail of business loans in India from a variety of sources, ranging from secured loans from banks to unsecured loans from NBFCs. Loans can be availed for meeting expenses related to the land or premises, staff, inventory, equipment, etc. If a start-up is looking to apply for business loans online to kick start their operations, they can also get working capital loans from banks to get their venture up & running.

Here is a table regarding interest rates ad per top cities for business loans in India:

City Interest rate
Mumbai 13.50% onwards
New Delhi 11% onwards
Kolkata 16% onwards
Bangalore 13.50% onwards
Chennai 13.50% onwards

The lowest business loan interest rates start @ 13.50% from different banks.

These are all the things a business owner should consider while reforming their business operations. Granted, nothing comes with a 100% guarantee but following these strategic benchmarks will set one’s business on the path of development and future growth. You can also hop on Lending kart’s website for efficient assistance for your business.