After review hundreds of cases and working for too many clients to count, we’ve come to find that there are three crucial steps for success: Hiring the right people, balancing the right money, and having a good business culture. These three things can set your business up for long term success.
This week we are going through our breakdown of what each of these three goals does for your small business. Yesterday we talked about setting your business up for hiring success. Today, we will talk about money success. And stay tuned tomorrow for our discussion of office culture success. Read on for more finance information!
Unsure of how to take your business from good to great? ProStrategix knows how to help. Read some of our other articles below, or feel free to connect with us and get a complimentary thirty-minute consulting session.
Focusing on Finance for Success Managing Money
Money may be “the root of all evil,” but an incredibly important root! Money is probably the biggest factor that holds businesses back from long-term success. It’s usually because they wait too long on financing, or they don’t know how to get the right type of money for their business. What’s the right loan, and how do I manage the money I have on hand? Every business owner needs to answer these questions at some point for their own success.
Minimize Your Costs
The best way to get money is when you don’t need it. I know that sounds crazy, but it’s true. You will get your best rates and terms when the business is healthy. Don’t wait until you need the cash to go looking for it. That’s when you’ll get clobbered. See how you can keep your overhead as low as possible without compromising quality. It’s a difficult balance, but a profitable business will be able to get the right financing for best rates.
As we said in our recent post about tax prep, bookkeeping is crucial. The fact that 60% of businesses don’t use a professional is concerning. Transparency is critical. Lending or investing is about trust. Without trust, you won’t get far. Investing a little time and money into getting all your books in order is money well spent. While some people are good at selling ice at the North Pole, we don’t recommend this approach. Once you’re caught or your name is tarnished, your business is kaput.
Have the Right Tools for the Job
Quickbooks or another accounting software package is essential. It’s the cost of entry these days. It’s important to weigh the cost and benefit of these programs. There are some fundamental features that are critical: chart of accounts, aging accounts, balance sheet, income statement generation, cash flow tracking. While others are more specialized to specific needs. Be sure you have the tools for the job, but also make sure you’re not paying for features you do not need.