Working as a business owner for the first time can be a huge change of pace and will likely take a lot of getting used to. As a business owner, you now have the responsibility to manage your own finances and a whole empire.
Managing finances for a business is a lot different to your personal finances and it can be difficult to keep afloat. As a new business owner, we want to share with you some of the top tips you need to take on board to stay financially sound this year.
- Plan payments in your calendar
The most important thing to do when you begin managing your finances is mark out the dates each month that bills leave your account. Every bill will leave your bank account on a different day of the month and you can record this to ensure you never find yourself without money. It is important for you to record every payment as well as direct debit, and this will allow you to stay alert every month.
- Record, record, record
As well as recording payments that will leave your account due to bills, you also need to record any small purchases you make from your work account. Whether it be a small coffee in the morning, lunch with a client, or travel to a meeting: receipts should be kept and recorded so you always know where your money is going. This is a crucial part of finance management because you will otherwise risk falling behind on your bills and making less profit due to higher spend.
- Offer easy payment methods
As a business owner, your aim will always be to reach as many people as possible. It is important for you to offer as many payment methods as possible to your customers when process payments online. This means as well as debit card payment you should offer credit cards, PayPal, and Apple Pay. By offering as many payment methods as possible you can reach more people, make more sales, and therefore more profits.
- Keep business separate
As an entrepreneur it can be difficult to separate your work life from your home life; and many of us when starting out manage business from our personal bank account. However, to keep your business as well as your personal life safe, make sure to open a new account for all business operations. This will ensure that you never spend too much on your business and come in short for your home bills, and visa versa. Keeping these separate entities is safer and allows you to gain a clearer view of what money you actually have to play with.
- Be smart about procurement
If your business involves manufacturing products, one important thing to consider is how to reduce the cost of making the products. One way to reduce costs when making products is to be smart with your procurement of supplies. When looking for supplies and materials to create products you can save money by buying secondhand, in bulk, or eco-friendly products. Be sure to do your research and you will be able to find some great bargains online.
- Create a budget
The most important thing to do when managing your finances for a business month is create a budget. First of all look at your incomings and outgoings and take out your bills, this will leave you with money to play with for your projects and operations. Always create a budget that is less than you have in your account, this will provide a buffer if you ever have a slow month of sales.
- Hire remotely
Why hire people in-house when you can hire remotely and save a ton of money? One of the biggest benefits of technology these days is that outsourcing and remote working is easy. Instead of renting out an expensive office space and paying for an employee’s pension and benefits, you can spend money on people who will work from home on a freelance basis.
- Cut costs
As a small business owner it is important for you to cut costs any way that you can. There are a lot of ways you can cut costs as a business owner, such as hiring remotely, smart procurement, and more. Find ways to save money on services such as free online tools, bulk buying items for the office, and more. Ensure that you never spend more than you absolutely need to, and it will make a big difference to your business.