Want to get your business finances in order? Check out our top 12 tips.
1. Set New Financial Goals and Targets
Set your financial goals and sales targets and make sure they are aligned with your short-term and long-term business vision. Taking time to re-examine your business can enable you to identify key priorities and cost inefficiencies that you will need to tackle in order to achieve your financial goals.
2. Create a Budget
Start by evaluating your income, expenditure and spending habits. Consider ways of simplifying bill payments, invoice payments and consolidating your debts to improve cash flow management and efficiency.
3. Boost Your Savings Plan
Small businesses need a savings plan to protect themselves in the event of a downturn or to cover any business development ideas. Take time to determine what percentage of your income you can set aside on a periodic basis and determine the amount of saving’s you will need to cover any potential business losses or what it will cost to cover any for future business investment.
4. Use a cloud base booking keeping system
Using a cloud base book keeping system allows you to get your accounting books more organised for the end of the financial year. Having a paperless solution can also enable you to keep tighter and more efficient records during your tax period.
5. Set Up a Business Account
The benefits of opening a separate business account is that it is an easier and more effective way to track business income and expenditure. Also, having a separate business account demonstrates complete professionalism.
6. Revise your payment Terms
Consider revising your invoice payment terms and conditions as this can help with cash flow management within your business. Reformat and edit your invoice template to ensure it has clear due dates and an easy-to-follow payment instruction.
7. Forecast for the Year Ahead
Good cashflow management is quite simple. The goal is to make sure you have more money coming in than going out. Give your business the best chance at staying afloat by forecasting cash flow for specific periods throughout the year. This will help you get a picture of where the business will be, so you can adjust your strategy to deal with at any point and plan for any big expenses.
8. Review Your Numbers Regularly
Once you have set up your cashflow statement, ensure you are reviewing your business cashflow on a periodic basis. Business cash flow is not static and will fluctuate at various points. Being complacent will only lead to financial failure.
9. Spread your risk
Aim t market your business to a larger number of potential customers. Don’t rely on a small number of customers too heavily. If they become insolvent or suddenly switch to doing business with your competitor, the impact on your business could be catastrophic.
10. Review Your Insurance Policies
The business environment is quite dynamic. The nature and scope of your business may have changed considerably over the past 12 months. Take time to review your business, product and public liability insurance policies to ensure they are still relevant for the changing nature of your current business practices.
11. Protect Your Business Against Security and Fraud
Protect your small business against fraud, especially in the case where your businesses activity involve technology, e-commerce platforms and electronic payments. Pay close attention to cybersecurity issues to ensure data is protected at every client touch point. Regular software updates and anti-virus tracking can help ensure both you and your client’s data is protected from any cyber threat.
12. Seek professional help
If accounting, bookkeeping and general cash flow management are giving you nightmares, then leave it to the professionals. Don’t lose sleep over something an experienced financial expert can help you tailor and streamline.