5 Ways I Simplified My Small Business Finances
Here are five tricks I’ve used to simplify my small business finances that I wish I knew earlier in my entrepreneurial career.
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Like many fellow small business owners know, a good idea is just the tip of the iceberg when it comes to running a successful company.
While it is important to focus on marketing your company and selling your products, it is also important that you don't forget to dedicate time to managing the financial side of your business. When I first started my company, it was hard for me to keep track of both sides of my business on my own. When it came time to filing my taxes, I ran into further headaches when I found my finances to be in a disorganized mess.
With tax reforms threatening to shake up the tax process and further complicate things, here are five tricks I've used to simplify my small business finances that I wish I knew earlier in my entrepreneurial career.
1. Set reminders and alerts.
While it may sound simple, setting reminders and alerts on your phone and computer can be huge helps when managing your finances. To assist myself for my own company, I have created a separate financial management calendar where I can set reminders and alerts specific to making sure my finances are running smoothly.
The reminders help me keep my business organized as they keep financial tasks crucial to the operation of my business from getting lost in the everyday rush of an entrepreneurial life.
2. Set goals and stick to them.
One of the most cost-effective additions I've made to my office is probably my whiteboard. Weekly, monthly, and yearly, me and my team meet to set goals for the growth and development of the company, and when we settle on concrete objectives, I write them on the board and hang it up in the office.
This helps not only myself but also the rest of my team stay focused on the big picture, which of course includes the company's finances. On my personal whiteboard, I make sure to keep track of financial projections and goals I want to hit in the future, helping me stay focused and improve upon my business' financial matters.
3. Use accounting software.
One of the biggest mistakes of my early career as an entrepreneur was that I was not as neat as I should have been when keeping my books. When tax time rolls around, you will have wished you ditched that pen and paper for something a bit more comprehensive.
While accounts can be cost-prohibitive for most small businesses, I've found accounting software to be both cheap and incredibly helpful for my small business workflow. By keeping track of my payments in a more professional manner, filing my taxes has become easier than ever.
4. Track your spending.
One of the most commonly overlooked but important aspect of small business finances is to make sure that you keep track of your spending. Without a proper method to track where your assets are going, it becomes easy for you to start personally covering ancillary business costs. For this reason, at my company, I make sure to put an emphasis on keeping receipts and accounting for all inflows and outflows from the company account.
In addition to accounting software, a wide variety of scanning and tracking applications that are meant specifically for tracking these kinds of expenses makes it easy for both me and my employees to keep track of where all of the company money is going.
5. Pay with the blockchain.
As many small business owners know, paying employees in a timely manner can sometimes be way more complicated than it should, making it frustrating for budding employers like myself to manage both the business and its finances. That's why, for me, the Blockchain has been revolutionary for organizing my payments and making sure that I can get my employees paid on time.
Crypto transactions are much quicker than normal bank transfers, and crypto platforms allow me to automate this aspect of my business, making sure not only that I don't forget to pay my employees but also allowing me to spend more time on developing my company and less time worrying about financial problems.
While some of these tips may sound small and inconsequential, I can tell you from personal experience that they all are immense helps when it comes to keeping track of my company's bottom line. Once you start implementing these strategies, you will find your time spent on reviewing finances decrease dramatically and filing taxes will be easier than ever. Taking the time now to put these systems in place will reduce your monthly fiduciary review to minutes by streamlining the process and keeping you organized.