Top 6 Money Management Tips for Small Business Owners
- Apr 17, 2014
Whether you're running a small business as a first-time entrepreneur or as a seasoned veteran, you know by now that money management is one of the keys to success. The trouble is that knowing something and doing something are two different things. The following presentation looks at six of the top tips for small business owners looking to improve their money management skills.
6 Money Management Tips for Small Business Owners
Money management is a crucial key to success for any small business. Whether you have been in the business for years or are getting started out for the very first time, following these tips can help you achieve your goals and help your company excel.
- Create and Stick to a Budget: It's impossible to properly manage your money if you don't set a budget. Take the time to jot down expenses, and try to balance these expenses with your company's revenue. Although you might have to make changes every now and then, try to stick to your plan as much as possible. Also, make sure to set aside some money just in case you need it.
- Save Money Whenever Possible: It's important to save money in every way that you can. There are a lot of different things that you can do, but you can start by buying used furniture, shopping around online for the best prices on necessary supplies, look for cash back programs through office supply store chains and using social media as free advertising.
- Think About Hiring a Professional: Crunching the numbers can be tricky, especially if you don't know what you are doing. Hiring a professional to handle the books can be a good way to avoid errors and take control of your company's finances. Although you will have to pay for this service, it will pay for itself in the long run and allow you to get rid of stress.
- Keep Your Eyes on Petty Cash: It might be necessary to keep petty cash lying around for emergencies, but you should still keep an eye on it. Make sure that you know exactly who has access to it, and hold people accountable if it seems to be dwindling down more than it should. Even though you might not have much in your petty cash fund, every dollar adds up.
- Be Cautious About Expanding: Expansions can be costly, stressful and time-consuming. Although it might seem like the natural thing to do is to expand your business, you should be cautious about doing so too quickly. There is nothing wrong with staying where you are for right now; then, take small steps towards expanding instead of moving too quickly.
- Constantly Monitor and Improve Your Cash Flow: On a regular basis, you should take an honest look at your company's finances. Determine things that you have been doing to save money, and stick to these routines. Also, look for ways that you can improve your cash flow. If you seem a bit short on money, consider putting off bills for a few days or offering incentives for customers to pay ahead; although you shouldn't do this too often, it can help ensure that you always have necessary cash on hand.
Knowing how to handle your company's money the right way can keep you on track and lead you and your business to success.