1. Understand that your primary responsibility is the proper use of capital and that you are in business to make a profit.
2. Test the economics of your product or service. Make sure that it is profitable and that the gross profit percent is in line with that of the industry.
3. Know how you will finance your business. Visit lenders (banks) prior to seeking financing to gather information. Ask your lenders what they will want to see before you apply for a loan.
4. Develop a personal financial evaluation. Determine your net worth and your annual, personal cash flow needs.
5. Develop realistic financial forecasts for income statements, cash flow and balance sheets for three years. Forecast monthly for the first year.
Brought to you by SCORE “Counselors to America’s Small Business.”