The world is your oyster when you run an eCommerce store. It is also exciting as you get to sell products you’re passionate about, enjoy global customer reach, and get to build a brand on your own terms.
One thing to keep in mind amidst all the excitement and anticipation is that even the best products and marketing won’t save a business if the money side is all a bit of a mess. Poor money management is one of the biggest reasons behind an online store failing, but with the help of options such as superb high risk payment processing, the good news is that avoiding common pitfalls is easier than you might think.
Here’s a look at some key dos and don’ts every eCommerce store owner should keep in mind, and why choosing the right payment processing solution is one of the smartest financial decisions you can make for the future health of your business.
Be sure to keep your business and personal finances separate
Although it might sound obvious, it is still surprising how many new store owners blur the lines between personal and business accounts. Keeping things separate makes bookkeeping cleaner, helps you track profitability, and protects you more, from a legal standpoint.
It is imperative that you open a dedicated business checking account and use it for all store-related expenses and income.
Keep a close eye on cash flow
It’s easy to get wrapped up in sales numbers, but what really matters more to your business in the long run is cash flow. It is the lifeblood of your venture, which is why you need to keep a close eye on how money moves in and out of your business.
Bottom line, a big sales month doesn’t mean much if payments are tied up in processing delays or if you overspend on inventory. Be sure to keep an eye on what’s coming in, and what’s going out. At the end of the day, healthy cash flow is the oxygen your store needs to grow.
Allow for growth in your budget
Investing in marketing campaigns, new product lines, or better tools is important, but it needs to be backed by a solid monetary strategy.
The trick is to create a budget that covers operating expenses, taxes, and savings, then also sets aside funds for growth opportunities. Too many eCommerce owners overspend during good months and scramble when sales slow down.
A smart budget works by smoothing out the highs and lows.
Get your payment processing options nailed down
It can be tempting as an eCommerce store owner to be swayed by the cheapest payment processing fees, and decide to go with that in order to save on costs.
More often than not, this mindset turns out to be a false economy and decision you soon regret.
It pays to remember that a payment solution isn’t just about fees, it’s also a facility that is very much the backbone of your business.
A reliable payment processor ensures transactions are secure, fast, and convenient for your customers. Make no mistake, delays, errors, or declined payments hurt your reputation and can even cause chargebacks that drain your revenue.
Also, a good payment processing solution offers fraud detection, support for multiple currencies, and integrations with your eCommerce platform, all of which matter a lot when you’re selling online.
It’s wise to look at payment processing as more than a cost, it’s also a trust-building tool. Customers want to know their payment is safe, and if they don’t feel confident, they’ll abandon their carts. Choosing a reliable and trusted provider is one of the best ways to protect your business and keep revenue flowing smoothly.
Money management isn’t the most glamorous aspect of your business, but it’s what separates thriving eCommerce stores from the ones that burn out. Following these dos and don’ts will boost your prospects of going from strength to strength.