How to Manage Your Cash Like a Big Business
Want to turn your small business into a big success story? It all starts by managing your finances like a big business, and that means focusing on growth. In order to expand your company, you have to plan ahead, keep track of your cashflow, and cut costs wherever possible. Here are some simple steps to start managing your small business finances like a big business:
- Ensure accurate accounting. Accuracy is key when managing small business finances. Make sure your accounting information is accurate and updated on a regular basis. If you’re not confident managing the books yourself, hire a professional or invest in accounting software. This way, you can check the financial state of your business and forecast your cashflow with ease.
- Separate personal and business finances. The importance of keeping your business and personal finances separate cannot be stressed enough. Confusing your business and personal funds can leave you uncertain about your small business’s performance and create chaos during tax time. Apply for a business credit card and make sure you’re only charging business-related expenses to it. Open a saving account for your small business and build it up with a portion of each payment you receive. In time, you can use this money to cover surprise expenses or tax bills.
- Create an invoicing strategy that works. Nobody wants to chase down payment from customers. By developing a firm yet polite invoicing strategy, you can be sure your customers don’t drag their feet in paying for your product. Keep close watch over your accounts receivable to ensure you’re getting paid correctly and on time, and don’t be afraid to follow up on invoices you’ve already sent.
- Save for a rainy day. Once your small business starts making money, it’s time to focus on saving. Look for areas where you can cut costs and save time. Is your small staff overwhelmed by a large order? Consider partnering with a company like Ohio Valley Goodwill Industries to outsource tasks like packaging, shipping, assembly, and kitting services. This helps reduce overhead and ultimately lower costs for your small business. Now you can focus on production without delaying customer satisfaction.
- Invest in partnerships, not overhead. Big businesses know that it’s often more economical to outsource assembly, shipping and packaging services during busy times of year instead of hiring and training staff. Companies like Ohio Valley Goodwill Industries have over a hundred years of business experience helping small businesses like yours compete with the big guys. Ask for a free tour of our facilities.