Is Managing Your Business Finances a Chore or an Opportunity?
There is a certain kind of business owner – we all know one – who would rather do almost anything then pay attention to bookkeeping. These men and women are legitimately busy, but neglect the financial side of their companies week after week. Eventually, as the statements, invoices, and receipts pile up, the job gets to be so big that they feel like they can’t face it at all.
It’s never easy running a business of any size, and we understand that there are lots of things that can take your attention away from spreadsheets and accounting software. Still, we think the problem most of these business owners are facing isn’t one that has to do with time, but perspective.
In other words, we think they are seeing financial management as a chore, when in reality it can be an opportunity.
You might not ever be the kind of person who cheerfully sits down with a cup of coffee to look over the books with a smile on your face, but paying closer attention to your business finances is worth the effort. Here are just a few of the things you get from the habit:
More Money to Put into Your Business (and Your Own Pocket)
This is the easiest and most obvious benefit of staying up-to-date with your business finances. The closer attention you pay to the money side of things, the more of your revenue you can keep (to either reinvest or pay yourself). You simply can’t maintain a growing, thriving company if you’re never sure what your accounts payable and receivable balances are like. You need important financial information at your fingertips… not in a stack of receipts and invoices buried in some dark corner of your office.
Better Relationships with Customers and Vendors
If you are chronically late when it comes to paying vendors, processing customer refunds, and keeping up with other basic accounting tasks, then you can bet it’s taking a toll on your bottom line. Even if you aren’t being hit with interest expenses and service fees, you can bet that the people who work with you are going to start charging you more, or holding back their best work, because they feel like you are a hassle to do business with. Staying on top of things like payments and invoices is a good way to improve business relationships all around.
More Opportunities to Grow and Expand
Most small business owners want to see their enterprises grow into something bigger. By better managing their finances, they can accomplish this in two ways. First, they can actually hold onto more revenue and take advantage of financing options when they are available; and second, they can spot trends in the marketplace and parts of their company that are generating the highest profit margins (in other words, studying the books can show them which areas of the business to expand).
Fewer Regulatory Problems
You probably don’t need us to tell you that you never want to have the kinds of problems that come with failing to pay taxes, lapsing on important business registration fees, or letting a license expire. Each of these can be an expensive issue to deal with, will almost certainly generate big headaches, and can lead to more regulatory concerns in the future. By simply knowing where your money is going – and keeping a close eye on which items are due and when, you can avoid some of the mistakes that kill businesses and drive their owners crazy.
Do any of these sound like benefits you’d be interested in? Luckily, taking financial control of your company only requires a few things: a new mindset, the right tools, and the discipline to set a new habit over the course of a few weeks.
No matter how busy you are, you’re going to have to turn your attention to the financial side of your company eventually. Why not make it a new habit today and start building a stronger, more profitable business at the same time?