Five Simple Secrets to Keep Your Small Business Accounting Manageablecustomonecfo
When it comes to making your small business accounting manageable, Des Moines Regional small business owners should keep these three words at the forefront of their thoughts: Keep it simple! It’s all too easy to be so involved in the nuts and bolts of growing one’s business that keeping the books can sometimes recede into the background. If this sounds familiar, don’t despair. By following these five simple secrets you’ll find it easier to successfully manage your business accounting.
- Business vs Personal Expenses: Never the Twain Shall Meet
Yes—it’s your business, and, by extension, any revenue generated by it is yours. This is especially true for sole proprietors. But it shouldn’t work that way, at least not if you want for your business to continue to grow and prosper. So simple secret number one is to keep expenses related to business totally separate from your household and living expenses. The best way to do this is by paying yourself a salary. Just make sure you pay yourself enough to live on without having to dip into business revenue.
- Keep a Sharp Eye On Labor Costs
Small business owners can sometimes be too generous with their employees. This is especially true if you have few employees and even more so if they are close to you personally. By all means, pay them a decent and livable wage, but by the same token make sure they are producing for you and for your bottom line.
- Be Diligent About Collecting Monies Owed to You
If you sell goods or services by contract and you are allowing payment in 30 days or less, don’t hesitate to immediately contact any of your customers who have not paid in accordance with the agreed upon terms. Remember, the longer you allow customers to be in arrears, the more likely they are to assume they can get away with late payments as a matter of course. You need to track your account receivables and be ready to place delinquent accounts in collections if need be.
- Conduct a Weekly Financial Review of Your Business Finances
this doesn’t have to become a chore. Once you begin, you’re probably going to find it’s something you grow to look forward to. Keep it simple. Spend about 15-20 minutes reviewing how much income you’ve received during the week, what your expenses were, how many new orders were placed, which of your accounts payable are you going to have to pay in the coming days. Jot it all down. Come up with a systematic way of doing so. You’ll find this may be the one time of the week where you can see possibilities ahead you might not have thought or, conversely, some areas where you need to focus on more control, like expenses or labor costs.
- Don’t Hesitate to Consult With a Professional Accounting Service When Needed
There are going to be times where you’re going to need the advice of a competent Des Moines accounting service. There are some questions and decisions, especially centered around taxes and regulatory matters, that only a Des Moines CPA can answer. Some of the biggest savings a small business can find are due to strategic tax strategies, and you’re probably going to need to rely on a professional for such.
Following these simple secrets will make your life as a small business owner more rewarding and profitable. When you need professional advice, consider CustomOne CFO & Controllers. They’ve been helping small businesses like yours to succeed for 15 years. Contact them to request a free consultation.