Mexico City on February 9, 2023.- Despite the various problems caused by the Covid-19 pandemic in the country, entrepreneurship in Mexico continues to be the engine that drives the national economy. According to data from the Study on Business Demography (EDN) carried out in 2021 by INEGI, in Mexico, from 2019 to 2021, around 1.2 million micro, small and medium-sized enterprises arose, a sector that represents 99.8% of the total number of businesses. the business of the country.
In accordance with let’s share bankFinancial institution of loans for entrepreneurs of the popular segment with greater presence and coverage in the country, the main difficulties in starting a business they range from fear of failure, lack of financial support, or even not knowing what business to start, which can limit initiatives with the potential to be successful ventures.
Due to the nature of this segment, the banking institution also locates that financial planning usually represents the decisive point at the moment of undertaking and achieving success, or if a business has already been started, it can also be the difference to generate capital savings. necessary to make it grow, for this it is important to improve the skills in terms of the effective separation of personal or family expenses from those exclusive to the company.
One of the main problems for Mexican start-ups is that the importance of business plans is underestimated both for those companies that want to start and for those that plan to expand. By not having prior preparation, the company is limited to development and has direct effects on the health of finances, often leading to complicated situations.
If your business has had a great 2022 and you have thought about making it grow, or if you want to start a new business, Compartamos Banco presents a series of recommendations to take into account when establishing a solid business strategy that brings you closer to the lasting success.
1. Carry out a market analysis
Before considering the idea of starting or expanding any venture, it is important to examine the market in which you intend to work (physical space, sector to which the company belongs, target public or potential customers and their needs or tastes), so that with this Obtain the necessary information to meet market expectations and your own. This is where you can do the following analyses:
- If your venture is required in that location: Determining if the business is necessary in the area where you want to put it will be vital for its success, since it is not useful for the inhabitants or people who frequent the site, you will have little influx of customers. For example, it is likely that the inhabitants of a subdivision do not need an internet cafe because perhaps everyone could have computers and navigation services at home, otherwise, it is possible that this type of position is required in areas of government offices because It is required to carry out online procedures and urgent impressions.
- Analyze your competition to innovate or expand your business: Through technology it is possible to carry out inspections along several streets to find out if there are more establishments that can compete directly with you. In the same way, it is important that you observe what are the differentiators or the elements that make other ventures stand out. The idea is to take the best practices from these businesses and apply them to yours to improve aspects that can benefit your customers’ shopping experience.
- External aspects that affect the business: You have to be aware of situations that can have direct effects on the development of your business. From aspects that can affect the increase in the prices of products, variations in the income of your clients, relevant dates for them and the turn of your business, or even health issues such as the pandemic, of which we have not yet heard. we recover, among others. These aspects, in addition to challenges, also represent opportunities, especially to determine investment amounts to be made or even times when it will become hard and cold money in your pocket, the so-called cash conversion cycle.
Plan and manage your finances:
Once you have the necessary information to determine if the venture is viable, it is important to make a financial plan that specifies the objectives, the elements in which you plan to invest and the ways in which you plan to obtain financing. Although this planning can be done individually, it is important to have the advice of experts who provide you with essential indicators for the development of your business, since, by having more information about your venture, you can have a more complete vision and, therefore, therefore, a better management of its financial resources.
At this point, clarity in the separation of income at the business level and personal expenses is highly relevant. Knowing that the pantry, household expenses (electricity, water, telephone, etc.), transportation and other services, even the maintenance of your home, are totally independent from those that must be paid for by the income destined to your business, no matter how similar they may seem, even when your venture is located within your home.
Also, absolute and clear control must be kept, in writing, of the amounts that come to the business as total income from sales or the services you provide, against its expenses or investments. To these must be added your earnings, which you can freely dispose of and for whatever you want. It is important that you inform yourself about the managing your personal and business expensesso that with this you have action plans to keep your finances healthy.
Don’t be afraid to use financing:
Many small entrepreneurs tend to fear the acquisition of debt by obtaining loans. In view of this, Compartamos Banco affirms that the acquisition of financing is positive for businessgiven that it accelerates its growth, allows expansion and the acquisition of new materials and even grants the ability to invest in key areas for the development of the business.
Take into account: if you plan to apply for a loan, research the financial institutions that offer it before applying, since those that provide financing for your business, with greater support and recognition from the country’s financial authorities, will be more reliable and safe.
Reinvest money correctly
Take into account that your business will always be in motion and that from any input you should consider the profits to make use of a portion of them in the constant investment to improve it. This reinvestment can include improving your premises, buying more materials of better quality, promoting yourself, training yourself or your work team or even, if you see the possibility, thinking about expanding your business and thus reaching another neighborhood or town. .
Remember that there are financial institutions specialized in offering individual and group financing to promote the work of micro, small and medium-sized entrepreneurs. If you are determined to expand or start your business, come to Compartamos Banco and learn about the credits they have for you. https://bit.ly/3IZhlq5
