If you are the owner of a small business, financial success will depend on your ability to manage your money wisely. As tempting as it may be, don’t spend too much money on advertising, because it’s an expensive and ineffective method of attracting new customers to your business. Instead, focus on doing things like improving the quality of your products or services so that people are more likely to want to purchase what you have to offer in the first place. Another important thing is to create additional revenue streams and diversify your income sources so that no single source can bring down your overall profits.
1) Have a plan
Planning for the future is as important for a small business owner as it is for anyone else. Have a plan! A financial plan will help you decide how much money you need, where to get that money, and what happens if you don’t have enough. At the same time, budgeting can help you control your spending and know when you’re living beyond your means.
2) Keep track of your expenses
It’s important to keep track of your expenses. Not only will you be more aware of how much money you’re spending, but it’s also a good idea if you want to reduce your tax burden. When it comes time for taxes, you’ll have a clear sense of what costs were necessary and which were not. To help with this task, many small business owners use either a spreadsheet or an app like Quickbooks. What should go into the spreadsheet?
3) Invest in accounting software
Investing in accounting software is a must for any small business. This will help you save time and money as it will be able to do things like keep track of your cash flow, calculate your taxes, and help with payroll. There are so many software options available at all different price points, which makes it easier than ever to find something that works for you.
4) Create a budget
A budget is a plan for how much money you’ll have coming in and going out. It also helps you figure out what your expenses are, so that you can decide if you’re earning enough money to pay for them all. Here are the top 10 financial tips every small business owner needs to survive
5) Understand your taxes
Understanding taxes is a must for any small business owner. Taxes can often be the difference between making a profit and taking a loss for your company. With that in mind, it’s important that you take the time to file your taxes correctly and keep up with changes in the tax law. For instance, Congress recently passed new tax legislation that will affect many small businesses starting in 2018.
6) Get insured
Insurance is one of the most important things you can do for your small business. If something happens, like a fire or theft, and your insurance policy doesn’t cover it, you could be out of business.
Plus, if you are sued for anything and don’t have insurance, you’re personally liable for damages.
Some small-business owners mistakenly believe that their personal homeowners’ insurance covers their businesses – but this is usually not true.
7) Use online tools
Starting a business is not easy, but there are many tools that can help make it easier. One of the most important things to do before starting a business is developing a financial plan. You should have a good idea of how much money you need, how you’ll get it and where it will go. There are also plenty of online tools for making your financial planning process easier.
8) Accept credit cards
Did you know that 78% of small businesses don’t accept credit cards? And that number is trending higher. But the good news is, it’s not as hard or expensive as you think.
Accepting credit cards can be a great way for your business to diversify its payment methods and attract more customers. You may have heard horror stories about fraudsters getting their hands on customer information, but with newer technology, those days are over.
9) Stay up to date
- Set up a budget for your small business. It’s important to know where your money is going and how much you have left over for other expenses.
- Don’t forget about the taxes! Figuring out what taxes you need to pay and when can be difficult, but it’s an essential part of running a business in the United States. There are many online resources that can help, or ask an accountant!
10) Get help when you need it
One of the most important small business tips is to know when you need help. When it comes time for you to seek outside input on your business, don’t be afraid to do it. This might come in the form of hiring a consultant or finding someone who can act as an advisor. The more knowledge you have about your business, the better off you’ll be.