Last Updated on Mar 30, 2020 by James W
If you have recently started up a business, then you may be beginning to worry about the financial side of things. Don’t fear; this is normal. Running a business can be tough, and the finances are the most important part of the operation. You may have got into business thinking that you could treat it as your own personal bank account. If that is you, don’t worry – you’re not alone. However, this isn’t a realistic way to approach it. If you want your new business to be a success, then you need to be careful with your finances. Without further ado, here are our top five tips for looking after your new company’s finances – before it’s too late.
Keep It Separate
This is crucial, but people often overlook or ignore it. You need to ensure that you are keeping your business’ finances separate from your own. I know – you might be tempted to think that as it’s your business, there’s no real difference. But I’m afraid there is. If you keep the whole thing separate from the outset, you will be saving yourself a lot of headaches in the long run. You want there to be as little confusion as possible.
Cut Costs
Any business needs to make a profit, so this is essential. Especially in the early days of your business, you should aim at being as tight-fisted as possible. Not only does this maximise the amount of turnover you make, but there is another benefit. Cutting costs right down to the bone means that there is less to keep track of. The fewer the outgoings, the easier job you have of looking after your money.
Get Paid Securely
If you want to be taken seriously in the business world, you need to set up methods of being paid which won’t fail you. Mobile payment systems should be at the top of your list. Particularly, look for EMV compliant equipment as this is about the safest option available to you. The other benefit of this method of payment is that it dramatically accelerates your cash flow. You’ll find that’s a huge plus in the early days of your business.
Don’t Expand Too Fast
Once you start turning a profit, it’s easy to get excited. And you should be pleased, that’s true. But don’t get too eager. If you expand your company too fast, chances are it will just fail. Quick expansion is not necessarily the name of the game; all too often, it just isn’t viable. Instead, take it slow and try to enjoy the journey for what it is. If you spend your whole time rushing around trying to maximise your profits, you will burn out. And there’s no evidence to suggest that it will do your business any good, anyway.
Consider Getting Help
Finally, don’t be ashamed to ask for help if you feel you need it. Chances are your company will need an accountant at some point anyway. So if you are struggling with the bookkeeping, hire a professional to do it for you. At the very least, this will free up your time so you can spend more of it doing what you love.
