Friday, January 15, 2016, PM | 1 Comment
When starting a new business, entrepreneurs must juggle a wide variety of aspects, including production, sales, marketing, customer service, and employee benefits.
The financial management of these tasks can quickly become overwhelming, and many new businesses have failed due to a lack of good fiscal management during the early years.
Fortunately, a number of products and services are available to help business owners take care of these important matters, which can help to keep their business in good standing.
Record Keeping and Fiscal Management
New business owners should take the time to ensure that clear protocols are in place to record financial transactions.
These should include customer invoices and the receiving of various payments at all levels of the business.
All paperwork and computer input should be documented to ensure that there is a backup for checking questionable issues.
Employees should be thoroughly trained in these protocols so that no transaction slips through the cracks, creating problems in accounting.
They should ensure that the people who handle the bookkeeping and accounting programs in their business are knowledgeable, experienced and trustworthy to avoid misuse of funds.
Make Payments Easy For Customers
Customers use a variety of payment methods to arrange their own finances, and you can encourage their continued business by providing multiple options for payment of your goods or services.
Checks, debit cards, credit cards, and even online payment options can help to provide a healthy cash flow for your business, month after month.
If you have invoiced accounts, ensure that customers do not get into the habit of withholding payment more than the standard 30 days, which can cause cash flow problems for you.
Assemble a Team of Professionals
Successful entrepreneurs know that reaching their goals becomes easier when they can rely on a team of professionals that handle complex matters.
You should meet with your accountant regularly to get a good understanding of the tax consequences of your financial decisions.
A good attorney can also help you to settle any problems you might encounter in running your business.
Research Credit Options Thoroughly
One of the most common problems of new businesses is overextending their terms of credit.
Always think twice before getting a loan to determine if borrowing money is the only way to achieve your objective.
You may be able to get longer terms from a vendor, or you may be able to call in some invoices that are due.
However, when you do need a loan, shop around for the best terms you can find. Know the business credit climate in your area and network with other business owners to find lending institutions that are welcoming to new businesses.
A few points lower on interest can save you hundreds or thousands of dollars during the year, so it pays to put the effort into finding the best deal for your needs.
Manage Employee Costs
A good HR software program can help manage the schedules and deadlines involved in handling employee benefits for your business.
These kind of hr software for small business programs can be a real help to busy entrepreneurs.
Also, make a point of understanding the finer details of payroll, which takes a significant chunk out of every business’s funds.
During busy periods, you may be tempted to add more overtime, but this decision can erode your profit quickly.
Consider all options when facing a period of growth, such as adding part-time employees or hiring temporary ones.
Avoid promising your employees more than your business can afford.
Employee benefit costs can grow to be a large expense that you may not be able to cover with your current cost structure.
Keeping good control over your finances can one of the key factors in securing the success of a new business.
Use these strategies, and you will experience a healthier bottom line throughout the year.
Rachelle Wilber is a freelance writer living in the San Diego, California area. She graduated from San Diego State University with her Bachelor’s Degree in Journalism and Media Studies. She tries to find an interest in all topics and themes, which prompts her writing. When she isn’t on her porch writing in the sun, you can find her shopping, at the beach, or at the gym. Follow her on twitter: @RachelleWilber