For many small business entrepreneurs, “independence” sounds like freedom and flexibility. No fixed working hours, no vacation ban and no bad-tempered boss. But anyone who turns this dream into reality knows that everyday life often looks less idyllic. Ultimately, being “independent” means that you are constantly responsible for all tasks. Accordingly, as a self-employed or small business owner, you also have to take care of the bookkeeping to manage small business finances.
What may seem like an impenetrable jungle of numbers and forms at first glance is not so bad at second glance. The basics of how to manage small business finances are not a mysterious science, but a craft that self-employed people can learn quickly and easily. All you need is the right tactics and the right tools.
You can manage small business finances without an accountant
Can you really manage small business finances without an accountant? Yes! When it comes to business, there are many things that you don’t know when you begin. But, as you start learning new things after starting your own business, you realize that it was not much difficult at all. The same is the case with managing the finances of your business. In the beginning, you may think that it is something that is going to be very difficult to do on your own because you don’t have technical knowledge.
What if we tell you that you are wrong, and you can manage all the accounts and finances on your own without any trouble? Yes, you heard it right. In this article, we’ve narrowed down some very easy and simple ways that allow you to manage all kinds of finances of your business without taking help or hiring an accountant.
Strategies to manage small business finances yourself
So, without any further ado, let’s find out how you can manage small business finances like a pro. Here you go with the keys to ensure security for your small business finances:
Write Everything Down
The first and the most important step of making sure that you manage small business finances well all by yourself is to write every single detail of the finances and expenditure of your business. It helps you to keep a record of everything, and you don’t skip anything when it comes to clearing the payments and paying salaries of your employees. This brings me to the second and the most important point.
Know the Salaries of Your Employees
You may think that you know the salary details of all your employees, but the truth is that more often than not, you end up messing things. Therefore, it is important that you have the salary details of all your employees in a separate file. It’ll help you keep track of the performance of your employees. Above all, you’ll be able to give raises to your employees accordingly.
Use the Right Tools
There are many tools and software present online that can help you manage small business finances by yourself. So, don’t waste your energies in doing things manually. Take some time out of your routine and do some research and see what tool suits you the best and use it to manage your finances like a pro.
How do you choose the right software for you? How can you be sure that you are choosing the right tool to automate your accounting and not regret it later? We list a few criteria that you should absolutely or optionally consider when choosing accounting software for your small business:
- the program must conform to the tax rules;
- the tool is tailored and adapted to the needs of your small business or start-up;
- the software should be able to create offers and invoices;
- it corresponds to your field of activity;
- the ergonomics make navigation easier;
- it is simple to use and the software is easy to use;
- access to information is direct;
- you can integrate the solution with your existing tools, etc.
With the right tools in your arsenal, you can easily keep track of your expenses and revenue, make smart decisions about where to allocate your resources, and stay on top of your financial health. One great tool for doing all this is getting an LEI number.
LEI is a unique 20-character identifier that links companies and other legal entities to the relevant registration authority. It’s used by businesses all over the world to identify their company and interact with other organisations in a secure manner. With an LEI, you can easily connect with other businesses, access financial reports, and more.
Create a Practical Billing Strategy
Paying salaries to your employees is not the only thing that you have to do when it comes to managing the finances of your business. You have to pay many bills that may include utilities, vendors, etc. Therefore, the total work at the end of the month can be a lot. One way to manage all of it effectively is by the money order. All you have to do is understand what is a money order and how it operates in business, and all your problems of managing the finances of your business will be solved just like that.
Plan Everything Ahead
If you don’t want to make any mistakes, then the most important thing is to plan everything ahead. Have a plan for at least two months in advance if you don’t want anything to go south.
Conclusion
Accounting is not the most popular. It’s boring and always pushed to the last minute. It would be a shame if poorly managed accounting kept your small business from growing.
There are many inexpensive tools available to manage small business finances. If you equip yourself as soon as possible, your bookkeeping will be simplified, automated and you will spend a lot less time and money on it: so you can concentrate on the heart of your business activities!
