Finance 101 - 20 WAYS TO MAKE YOUR MONEY WORK FOR YOU

There is no one way to manage your finances. Debt management is unique to every business owner. It all boils down to inventory – store owners in metropolitan cities might believe in investing in pieces that an owner from Tier II or III cities may not be interested in. Contrary to what most people believe in, inventory management, taking loans and indulging in a bit of financial risk is not a gamble. There is a foolproof way of handing your finances. From planning, not overleveraging, assessing risk, embracing a minimalist approach, investing in a solid software and a backend team, here’s what retailers believe will make you financially strong

- Vijetha Rangabashyam

1 Every extra kilogram of gold counts

Investing in inventory has to be done wisely. If a jeweller needs just 50 kilograms of gold, and he has over stocked by 20 kilograms, it will cost him heavily. Every jewellery retailer has to pay attention to how much of inventory he really needs. “Inventory management is mastered over time. But the intention to learn from past mistakes has to be there. Conversion rate remains constant, irrespective of the kilograms of gold jewellery one has in stock. Dead inventory has to be defined wisely. For every business owner this definition will be different,” says Himanshu Shekhar from Manohar Lal Sarraf & Sons Jewellers, Delhi. For some, unsold inventory for over a year will be considered dead for some others it could be 3-5 years of unsold inventory. Every business has overheads like EMI, rent, loss of interest on inventory; therefore one has to ascertain exactly how much inventory has to be stocked.

Some jewellers compare year on year value of gold, this is not profit. Appreciation of gold is not profit. Unless you sell that stock you are not going get profit. Unsold stock which needs to be returned or remade will bring in losses only. A jewellery retailer makes real profit only with a sale - Himanshu Shekhar, Manohar Lal Sarraf & Sons Jewellers

2 Don’t let debt do you apart