Money Matters For Your Business – Here’s Why
The Pharmacist VS Money blog has discussed personal financial freedom in the past. But, if you own a business, you also have to prioritize your company’s financial health. This is an involved process that includes everything from forming the right business structure to creating a budget and honing your own skills. Today, we share tips on how to keep your business in top financial shape.
Define your goals.
Do you know what your financial goals are for your business? If not, define them and write them down now. Do you want to pay yourself a higher salary? Do you need additional staff? Are you ready to expand? Answer these and other questions so you can determine how much money you should save, how much you should spend, and where it makes sense to take on debt.
Assess your debt.
Let’s get one thing straight right from the jump: not all debt is bad. As Crestmont Capital explains, business financing can help you build your credit and grow your business. However, if your debt includes things like late fees or excess inventory that hasn’t sold but is not yet paid for, then it’s time to make some changes so that you write fewer checks each month.
Set up your business structure.
As a small business, filing your business structure offers some financial advantages, such as lower taxes. Specifically, forming an LLC is a smart move that comes with the added perk of legitimizing your business in the eyes of the public. Don’t have an attorney? That’s okay, you can file on your own utilizing online services. Before you get started, study up on local regulations so that you form your LLC correctly and within the bounds of the law.
Get paid faster.
If you have clients that still have balances on the books, it’s time to start making phone calls to collect the money owed. While they will have plenty of excuses, remember that effective communication is the best way to ensure that you get paid on time. When nonpayment is a recurrent issue, you may also need to refine your invoicing processes. Use a customized invoice generator to create a downloadable invoice format. Make sure that your invoice includes everything from your colors and imagery to strict terms and payment conditions.
Reduce your expenses.
We’ve already mentioned reducing your debt load, but it’s also wise to pay attention to your upcoming outgoing expenses. Scour your books to see if you’re paying for industry publications you don’t use or, a more modern solution to saving money, consider moving your staff to a remote work platform.
Find an accountant.
Money is not everybody’s strong suit. If you get overwhelmed with numbers, consider hiring an accountant or bookkeeping service. At the very least, you can hire a personal assistant that can help you manage other areas of your business so that you can pay more attention to the books.
Refine your skills.
Another option is to go back to school to learn more about accounting and economics. If you’ve already got a degree, look into earning your MBA, which can also teach you more about strategic planning and marketing. Each of these areas will help you be a better business owner so that you can best manage your incoming and outgoing funds.
Your business’s financial health is really your financial health. It takes time and effort to ensure that you are making more than you spend, but it’s worth it. While the above tips can help, ultimately, it’s a matter of diligence and smart business decisions that will help keep your business out of debt and in the black.
Visit the Pharmacist VS Money blog each week for more money-saving tips.