Many business owners feel as though they are losing control over their company’s finances. The sooner you take action, the easier it will be to regain control. In today’s world of economic turmoil and the uncertainty of the future, it’s more important than ever before that business owners have a clear understanding of their finances, and control them accordingly.
Here are some tips to help you get back on track again.
Work more closely with your accountant – If you don’t already have one, GET ONE. Better yet, according to The Balance, “your business needs a CPA, not just an accountant.” Even with all of the advanced bookkeeping software available these days, it’s still a good idea to have an actual CPA. An accounting professional will not only keep books for you, he or she will also review transactions and statements, help you manage your accounts, and work with you to create a solid business plan.
Carefully reexamine your processes – Simply looking at your finance reports isn’t enough; you must understand why the numbers are the way they are and what needs to be done to get them to where they need to be. This can be done by analyzing all of your processes. How are you doing business at every stage? Are you spending too much on advertising without first identifying your target demographic? Or investing in expensive software and training for your employees when it would be cheaper just to outsource to professionals who already have access to the software and know how to use it? Changing some of your unprofitable processes can directly affect your bottom line.
Have a good understanding of your limitations – As you are evaluating your processes, it’s important to know what exactly you can fix and what you cannot fix. Identify and accept your weaknesses. Aspects that are beyond your capabilities must either be eliminated or put into better hands. Don’t hesitate to ask for help from a consultant, or tobarter underperforming assets that your business is not equipped to deal with. It’s easier to take control of finances when you are no longer wasting time on these aspects.
Focus on financial forecasting and planning – It’s useful to develop a financial framework for keeping track of all of the finances coming into and out of your business. For example, you might want to create a plan where you would spend 50% of revenue on expenses (including supplies and payroll), 30% of revenue on building and growing the company, and the remaining 20% of revenue for developing new services and products in the future. According to Houston Chronicle, “payroll expenditures that fall within 15%-30% of gross revenue” is a sign that business finances are “in a safe zone”.
Never get behind on debts – Once you start getting behind on debts, it’s going to be increasingly difficult to stay on top of your finances. If you are behind on debts, pay them NOW. Make cuts wherever possible. If you really have to, make some sacrifices; just get those debts paid off!
Keep in mind that every business is unique. Different plans work for different companies. When planning for the future, always be aware of the fact that circumstances change and the unexpected may happen. Making sure that your finances are in order is the best way to safeguard against any unexpected crisis.
For corporate bartering considerations, Sherwood Integrated Solutionsis a great choice, as their network of professionals are well-equipped to work with you in achieving your goals.