Quite often, small businesses fail to keep track of their spending as well as chase up invoices which can seriously impact the daily business operations. According to Business Insider, 2 out of the 5 top reasons small businesses in the US fail is financially related. These include cash flow problems and running out of cash.
Our practical and easy 4 tips to finance organisation for a small business will help you build and grow your business without financial hassle instead of failing and flailing around in your finances.
- ALWAYS KEEP PERSONAL AND PROFESSIONAL EXPENSES SEPARATE
While it may be tempting to swipe your business credit card for little Timmy’s new sports uniform, it is best to keep your personal and professional expenses separate. Too much crossover can cause organisational chaos come tax time as this is a personal tax expense, not a business one.
- MAKE SURE YOU GET PAID
As most small businesses are a one-person band, quite often chasing late payments is neglected. To overcome this issue, schedule in a time during your work week – 1 hour will do – to chase any outstanding payments and send email reminders about upcoming payments that are due. You will find an increase in invoices being paid on time if you commit to just 1 hour a week for this task.
- IF YOU HAVE NO IDEA, GET HELP
If chasing invoices, balancing your books, tracking your expenses and income or paying your employees is all a bit overwhelming or you’re just not that good at numbers – HIRE HELP! This is the best thing you could do as a small business if all of this is a bit too much. Hiring a bookkeeper or an external company to do this for you means you can concentrate on what you do best as well as growing your company, rather than sweating the small stuff.
- TRACK YOUR EXPENSES AND INCOME VIA YOUR OWN SPREADSHEET
Track your own expenses and income will enable you to have a healthy and organised snapshot of where your finances are at any given time. Set up your own tracking sheet or you can download this one we have created for you. Just click here.
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