Financial literacy: A mandatory requirement for running a successful small business

DepositPhotos

Managing money is hard. For small businesses, especially those that are minority-owned,  developing strong financial literacy skills is critical to their success. Thankfully, there are many helpful resources available

Lyndsae’ Peele, the founder of Kingdom Vision Consulting, notes small business owners know how to do their craft or service, but that is only one aspect of running a business. An owner’s business acumen is also critical to keeping the company moving forward profitably.

Peele is a results-driven finance coach and black wealth advocate. Her banking experience and passion for economic development led her to create an educational radio talk show and a strategic consulting firm. Kingdom Vision was honored as the Small Business Administration’s 2022 Maryland Financial Services Champion of the Year.

“A lot of small businesses are solopreneurs. We are the chief everything officers,” she said. “We are in charge of marketing, technology, operations, and finances, literally all of it. However, to scale, you must bring in support and learn how to delegate. A lot of times we consider those dirty words because small business owners are relinquishing their babies into the hands of other people who want to come and support them. However, if you don’t know what it takes to manage and grow a business, then you are not going to be able to do it successfully.”

Learning small business financial literacy is always important and now, more than ever, due to supply chain issues, inflation, and the continued fallout from the COVID-19 pandemic. “Now it is time for us to start rebuilding brick by brick, and a big part of that rebuilding is making sure we are tapping into small business financial literacy,” Peele said.

This information can help in developing an effective strategic plan. “So many business owners, nowadays, they can only really handle thinking about next week, next month, or maybe 12 months from now, but once you became financially literate and understand how money works, and how to take advantage of resources that are available, you can plan for long-term growth,” she said.

For example, if a business wants to add a new location and hire more employees, the information available from a comprehensive financial literacy program would ensure the owner is able to create sales projections and predict potential cash flow. That information would become particularly valuable if there was an income gap and the owner needed to apply for a line of credit.

Peele notes one of the largest barriers she finds when teaming with clients is their mindset. “Most of them are accustomed to just surviving because they have been accustomed to surviving in their personal finances, and they have that mindset with work,” she said. “It starts from the inside. It really is an internal battle to overcome and understand that you are worthy of financial success and know you are capable of managing, growing, and sustaining your business, and understand you have what it takes to build wealth.”

There are options available to give entrepreneurs access to critical organizational and financial services of local chambers of commerce which include the Maryland Black Chamber of Commerce created to offer networking opportunities, affinity groups, resources, and partnerships that provide training, workshops, coaching, and funding assistance.

The Maryland Hispanic Chamber of Commerce is another resource that serves the Hispanic business community by promoting business opportunities, workforce development, resources, and making connections through awareness and mentorship.

The Greater Baltimore Urban League nonprofit has launched the Raymond V. Haysbert Sr. Center for Entrepreneurship Community Development which provides capital to small business owners who may not be able to get funds through traditional lending sources. It also helps with business coaching, planning and projections, operational guidance, and other support services.

There are also government-sponsored programs to help individuals learn about how to be business owners, including those which target specific sectors, such as veterans.

“There are so many local programs, but if we are not taking advantage of them, the programs aren’t going to be able to continue to get the funding they need to provide these resources,” Peele said.

Financial institutions are also a great resource for learning more about business acumen. Peele notes people typically have transactional relationships with their banks or credit unions, only utilizing them for basic checking, and savings accounts and making deposits and withdrawals, which does not allow for developing a well-rounded financial relationship.

“It doesn’t cost you to walk into a bank and talk to a banker, but a lot of times we are afraid,”  she said. There are a lot of trust issues between minority communities and financial institutions. However, they have what we need.”

“It is really helpful when you understand financial literacy and how it impacts your business, from being able to pay your employees, to opening a new location or hiring a new employee in the next six months,” Peele said. “You understand how to utilize the resources around you, but if you don’t know they exist, or how they work, you won’t know how to utilize them to grow and scale your business.”

Minority Business/Expanding Opportunities cover

Expanding Opportunities

This article is featured in the 2022 edition of The Daily Record’s Expanding Opportunities Resource Guide for Small, Minority and Women Businesses that was published on Sept. 23. Published in conjunction with the Governor’s Office of Small, Minority & Women Business Affairs, Expanding Opportunities explores diversity, entrepreneurship and innovation in Maryland’s small business community. Read more from Expanding Opportunities or read the digital edition.


https://thedailyrecord.com/2022/09/20/financial-literacy-a-mandatory-requirement-for-running-a-successful-small-business/

Next Post

Top Stock Market News For Today March 7, 2022

Stock Market Futures Fall On News Of Potential Bans On Russian Oil Imports U.S. stock futures are well in the red at the start of the new trading week. This appears to be the case as markets react to the latest development on the Ukraine-Russia war front. In essence, mentions […]