By Ankit Gupta
Effective finance management is a primary necessity to run a successful business; however, for a small business it becomes even more crucial and demanding. Owing to limited budget and manpower small business need a well-planned finance management. Though effective finance management is absolutely imperative and needs an expert handling, still, there are some really easy and smart ways which can help in smart finance-management. For all the small business owners and budding entrepreneurs, here are the top 5 ways in which you can manage your finances smartly.
Consider Each Month As A Mini Year
Every fiscal year begins with financial goal setting for the coming 12 months. Chalk down S.M.A.R.T. goals which are Specific, Measurable, Attainable, Realistic and Time-sensitive. Have one annual goal but break it down into 12 small and digestible goals to make them easily accomplishable. Treat each of your month’s ends like a mini year; as you usually check all numbers by the end of the year, make it a practice to go through all the finances by the end of each month.
Try Your Hand At Cloud Accounting
Cloud-based accounting can act like a life-saver for many small businesses that find it hard to keep a track of their finances. Cloud accounting enables you to get real-time insights into your business finances anywhere, anytime and from any device. It also helps in eradicating any error-making from the finance inputs to ensure that your debit and credit numbers are in sync. Some of the best cloud-based accounting software are Xero, Freshbooks, Wave Accounting, QuickBooks, Kashoo, and Outright.
Keep Your Business And Personal Finances Sorted
While planning ahead for the business, many small businesses tend to commingle their personal and business funds. In order to streamline your business finances, it is important that you sort out your personal and business finances separately. Have a separate account along with credit card or checkbook dedicated for all your business finances. It not only ensures smooth management of the small business finances but also help you in handling all the taxes easily by the end of the year.
Get Help From Financial Professional
You can either hire a CFO or Chief Financial Officer or go with any experienced financial professional or accountant to manage your small business finances efficiently. A financial professional can share his/her expertise in checking your business finances to determine ways to maximize returns while minimizing any deductions. A person with experience in small business finances is recommended as he/she would know how to track down the business and advice on cash flow, tax returns, audits and other things.
Invest In A Good Documentation System
The old story of coming up with a shoebox full of receipts at the end of the year would come true in your case if you do not have a documentation system to maintain all your paperwork. You can take the old school way of keeping a manual paper filing system by stacking each piece of paper in dedicated files, folders, and cabinets. The coming of age, technologically advanced way to documentation is by replicating all the documents into the computer file systems which is later backed up on the cloud. Google Docs, Dropbox, and Hubdoc.com are the top clod-based systems for quick and safe back-up of all the finance transaction files.
While climbing up the hill of success to be at par with the big businesses at the top, a smart small business finance management acts like your climbing crampons to make your climb smooth and successful. Apart from having a vision, business acumen and referring to small business marketing guide, finance management is a borderline necessity for any small business. Manage your small business finances effectively using the smart ways discussed above. Try them with your small business and see all your business finances getting on the right track.
Ankit Gupta is the managing head of China.exportersindia.com, which is a leading Chinese business to business marketplace. Owing to his passion for his profession, Ankit has a knack for sharing his valuable insights with small businesses and budding entrepreneurs to keep them updated with the latest business trends and management ideas. To know more about Ankit, you can follow him on his Twitter, or Google+ profile.