Right now, approximately 77% of adults are worried about their financial situation – a figure that likely rises if the individual in question is a business owner.
After all, the current cost of living crisis means that not only are business expenses increasing, but customers are spending less, too. For example, in a recent study, 63% of adults reported that they are spending less on non-essentials in 2023 than ever before.
As such, you must be able to get your finances in order if you’re going to be able to weather this storm and grow your business.
With that in mind, here are some top tips to get in control of your company’s finances.
Keep tight financial records.
One of the biggest money-related mistakes you can make when running your own business is failing to keep track of your spending. As a result, keeping tight financial records is one of the easiest ways to gain the upper hand with your new business. After all, this will help you to identify any mistakes you may be making sooner, rather than later. For example, you may notice that you are overpaying for certain services when you realize how much of your monthly spending they account for.
Chase up unpaid invoices.
Cash flow also contributes significantly to how financially healthy your business is – which means you need to start chasing up late invoices from clients and customers sooner, rather than later. A recent study found that three in five business owners are owed money from late payments, which makes clear just how serious the issue is. One way in which you can ensure invoices are paid in a timely manner is by sending reminders and charging interest on late payments.
Accept as many forms of payment as possible.
Making it as easy as possible for your clients to pay you for your products or services can make it easier to keep on top of your finances while also boosting your overall income. For example, you should make sure that you are able to accept payments by card or online transfer as opposed to cash alone.
This is particularly important when you consider the fact that most people prefer cashless payments due to the fact it’s much easier and more convenient to pay by card.
Consider hiring an accountant.
While hiring an account may seem like an additional expense during a time when you are trying to curb your spending, there’s no denying that they can be instrumental in ensuring your firm is in the best possible position financially. From identifying major mistakes you may be making, to preparing your taxes – you cannot underestimate their overall value. As such, the cost of hiring an accountant (part-time or full-time) is a great example of spending money to save money.
Furthermore, by handing this work over to a qualified expert, other members of your team are able to focus on the roles and duties actually detailed in their job description – which means your company will function better, and your earning potential will increase tenfold.