Everyday Money Management Tips for Small Business Owners
Money concerns top the list for many small business owners when they are asked what their top challenges are. While it is possible to give your business a financial makeover by modifying procedures, there are also some easy things you can change day-to-day to improve finances. Here are a few practical actions you can take every day to effectively manage your money.
First off, make sure you have separate bank accounts for personal use and your small business. Even though most individuals claim they know to never mix their personal expenses with the expenses of their small business, it seems to be a common issue. Many think it is okay to take funds out of one to put into the other, as long as they put the money back eventually. In the beginning it will be difficult to keep your expenses separate, but getting into the habit of not mixing them early on will protect both you and your business.
Next, make sure all vendors know what you expect before signing a contract. The earlier you make sure the vendor knows your expectations, the sooner you will know if and how they can be met. In the initial discussion you have with your vendor, bring up the expectations you have and see if they can be incorporated into your contract in a way that will meet both of your needs. If you have any want or need to negotiate prices make sure this is done before the final agreement. If your contract does not clearly lay out their responsibilities, your expectations, or deal that were agreed upon you must quickly get the contract clarified. Make sure your expectations are aligned to the contract-that will be the only thing you can count on if the going gets tough. Knowing their responsibilities, and them knowing your expectations, will prevent either party from expecting anything more or less.
Another tip that will save you money, and build a good relationship with your vendors, is making sure you pay them on time, every time. During your initial contract discussion, make sure your definition of “on time” and their definition of it aligns. Some small business owners may have accounting policies, meaning it will take time for a vendor to receive the payment. Sometimes a customer will not pay as a sign of displeasure with services, just like someone may leave a bad tip at a restaurant. This is inexcusable, and often times the issue can be fixed to meet the client’s needs with a simple discussion. Not only will late payments cause tension between you and the vendor, but a late fee may be added to your bill, which can add up over time.
One of the easiest ways to save money is simple: make frugality a habit. No, we aren’t saying you must become an extreme couponer. But why not search for sales and coupons to save your business some change? Just like the late fees will add up, so will the money you save from being frugal. Buy major equipment or furniture secondhand, pay attention to lights left on when they are not needed, and unplug your laptops and other equipment at night or when you are away. Make sure you are conscious of all office supply purchases as well. Yes those decorative puppy sticky notes may be cute, and that fancy pen that doubles a stylus may look like you need it, but what else could you be spending those extra few dollars on?
Lastly, one of the absolute best ways to save money every day is by knowing where your money is going. Make time for an accounting and bookkeeping refresher. Bookkeeping procedures can help you identify which goals are reasonable, identify any issues or possible opportunities, and can be used to hold everyone accountable in all departments of your business. There truly is valuable information hiding in your business finances, you just need to be shown where to look, and how to take advantage of it. Being a small business owner doesn’t mean you have to automatically be a whiz with money, but you are still the one responsible for making financial decisions for your company. Outsourcing your bookkeeping does not mean you need to entirely hand off your books to somebody. Ask to have a regular meeting with them to review any account progress and important financial reports. They should be open to reviewing these with you and completely explain the meaning and importance of each.
Bookkeepers should not be looked at as just another expense. It is important to meet with a bookkeeper more than just right before tax time. Bookkeepers are business partners, and the right one can take your business to the next level.
Bookkeeping Services in Wilmington NC
BOSS is a growing firm of local business advisers who are committed to providing responsive service, strategic thinking, and competitive pricing to our clients for bookkeeping services in Wilmington NC. If you’d like to learn more about running a small business or need a bookkeeping services in Wilmington NC give us a call at (910) 338-1198, stop by our new office located at 3901 Oleander Drive, Suite G in Wilmington, or click here to fill out our online contact form. We look forward to hearing from you! be able to better manage your expenses, save money and time, and have access to an expert who will have the most recent tax knowledge and can maximize your deductions.