Improve Your Business Finances With These 4 Easy Steps

The difficulty in running any business is innate and if you’re struggling with your business finances, then it can easily spiral into a horrible nightmare that’s difficult to get out of. It’s easy to get lost in the glamour and fun of owning your own business and neglect your finances. That’s why we’ve put together this short list of basic tips and tricks you can use to improve your business finances.

Keep Personal and Business Finances Separate

It should be obvious, but keeping your personal and business finances separate will make a world of difference in improving your business finance. Particularly, it becomes much easier to track expenditure and profits which won’t be muddied by your own personal spending. An easy way to do this is to keep separate credit and checking account for your business expenses. By creating these separate accounts, you can let your bank do the majority of your business spending tracking. Online banking especially has made this easier than ever before. Banks even offer applications that you can install on your smartphone to track your business finances down to the minute. Additionally, consider investing in quality accounting software that can help automate many of the tasks associated with tracking finances and help alleviate headaches around business finances.

Hire A Professional

Unfortunately, not everyone was born to handle numbers equally and not everyone can handle tracking and take care of the business finance. But that’s why we have professional bookkeepers and accountants. If trying to manage your own finances is making you want to tear out your own hair, then you should strongly consider hiring a professional. While hiring a professional does bring an extra expense into the business, if you can afford to pay a little extra each month for your peace of mind, we recommend it. However, make sure you keep careful tabs on whoever you should hire. While you hired a professional to help, make sure that professional has your best interests in heart and frequently meet to discuss your business finance so that you always have a clear picture of what’s being done.

Make A Budget

Once you’ve created an easy way to keep track of all your personal and business spending, it’s time to create a budget and most importantly, stick to it. As important as forming a good business plan, a budget is an excellent framework that you can use to formulate future business decisions. Having a budget in place helps to cement the gravity of any financial decision you need to make. For instance, knowing that you can only spend $1000 this month on advertising makes it much easier to make a decision when an advertising firm provides a modest proposal for their services. Additionally, making a budget will help you plan far more into the future for any unforeseen circumstances that can arise. After you’ve been operating your business for a while, you’ll be more aware how much different emergency situations will cost you. For instance, after experiencing and surviving a power outage, since you now have a great way to track your expenditure, you can see the financial impact of the power outage, and work in a small power outage saving system into your budget in case you might expect more in the future.

Find Savings Where You Can

Now you’ve got a way to track your expenses and you’ve built a budget. It’s time to find a way to improve the profits of your business and one of the best ways to do that is to decrease unnecessary spending in a lot of unexpected places. If your business has a brick and mortar location, then it’s a good idea to start looking there for unnecessary spending. For instance, investing to change the outdoor lighting of your location to LED lamps is an excellent way to reduce expenditure. LEDs are known to use less energy and reduce the cost of electricity bills. Other utilities should also be tracked for savings. Another example is heating and air conditioning. It’s entirely possible that you’re overspending in those areas when you don’t have to throughout the year. Another excellent place to find savings is to learn to start asking for discounts when you can. Most people are too shy to ask for a discount when purchasing items or hiring services and you should take advantage. Even if a price seems fair, always ask if there is an available discount or sale that you can take advantage of to save more money in your pocket.

Ultimately, the most important tip that we can provide to improve your business finance is in our first two tips; Track your finances. Create a stable and simple system to track your business finances, and making a budget and then working within that budget become a much simpler task.

Nick Brown is a blogger and a marketing expert currently engaged in projects for Media Gurus, an Australian business, and marketing resource. He is an aspiring street artist and does Audio/Video editing as a hobby.