More excerpts from my forthcoming book.............

If you like what I write do suggest a publisher for me.

Nevertheless, though, you should remember that not all philosophies about losing money are actually true. Some of them are plainly myths, which means they are caused by wrongful perceptions by the business owners or that these financial losses are things that they can control, only that there are certain factors that eventually lead to their occurrence.

When it comes to truth about losing money, here are some of the things that you should believe in:

1. You are losing money because you’re doing work on your own. In a recent study conducted by the SBA (U.S. Small Business Administration), small-enterprise businesspersons will likely spend around 40 percent of doing routine work. It also means that you have wasted 40 percent of opportunities that you may have grabbed, if only you have focused more on marketing and sales too. This is one of the major reasons why there are already numerous businesspersons who are hiring virtual personal assistants. These are people who can act as their personal secretary. They are the ones to make and take the call, respond to normal queries, organize special promotions and joint ventures, market your products and services, and perform other menial jobs. However, you will be able to bring down the costs as you don’t actually need to have them right at your own office.

2. Debt can make you lose a lot of money if you don’t know how to use it wisely. If you remember in chapter 1, we have talked about the importance of acquiring debt. You can use it to function as leverage to your equity so as not to definitely drain all your finances for your business venture. However, things can turn out real bad, if you don’t know how to use it wisely.

A classic example of how debt isn’t managed wisely is when your income is far less than your expenses. When you can hardly pay your personal loans because you’re more concerned on your next trip to the Caribbean, then your business is in a ticking clock now. You should make sure that among all other kinds of expenses, this should be proclaimed first and easily deducted from your gross income.

3. When you take a risk that you cannot withstand, you’re going to meet your ultimate downfall. When you are in business, then you know that you are going to be facing a lot of risks. After all, there aren’t any really specific guarantees, though with proper planning and implementation of the plan, you will already have an idea if you’re going to succeed or not. Nevertheless, you will eventually experience financial loss if you don’t know how to make any calculated risks. This happens when you enter contracts and deals that aren’t clear to you. It may also occur when you don’t hire real talent in your business. Most of all, you will lose if you cannot afford to take the risks. When you know how to manage the risks effectively in your business, the margin of error will get smaller, and there are lesser negative consequences that you’re going to face.

4. Too much borrowing doesn’t provide you with the kind of additional money that you need. Surprisingly, there are still businesses that tend to stay afloat simply because they keep on borrowing money from the bank and other lending institutions. Perhaps they have not fully understood the possible negative implications of the situation. First, they need to increase the prices of their products and services just to be able to also increase their income. They may also have to lessen their expenses, usually chunking down a big portion on the salaries and advertising costs, which would normally take a large part of the expenses pie. Moreover, they will be paying high interest rates the more that they are going to acquire loans. The return on investment, too, will become too low and more difficult to achieve.