Know What Is Going On
Some small business owners make the mistake of handing over too much of the financial decision making authority to another person.
While there is nothing wrong with delegating, especially if you are not that good with managing finances, it is always a good idea to keep your hands and head in the books.
There should be no big surprises at the end of the year, because you should know where the money is going throughout the year.
If your small business has departments with their own budgets, it is vitally important that the department managers know that going over the budget is not an option.
Obviously, unforeseen circumstances may require additional expenses, but those financial decisions should not be handed over to the department managers.
Instead, any expenses over budget should be discussed with you (or your representative) prior to any decisions being made.
It Adds Up Quickly
People who are wise with their finances, whether personal or business, know that being a stickler is not a bad thing.
Not knowing where the money is going is a huge mistake. Another mistake is spending a sum of money without first considering whether or not the expense is necessary.
Free spending gets big businesses in trouble all the time. That type of spending can destroy a small business even faster.
Get Professional Help
While you should always keep an eye on the books, it is also important to hire someone who can help you with your finances.
An accountant can be sure that your business financial decisions are in line with all of the federal and local laws. Also, keeping the books properly requires a time commitment that you could better spend helping your business grow.
Do not mistake hiring an accountant for giving over the financial decision making for your small business to someone else.
Let an accountant keep your books on track, handle your payroll and make sure that your business gets every possible tax deduction.
And, make sure that you know what your accountant is doing.
Business Credit Cards
You know how it is somehow a bit easier to spend money when you’re paying with a credit card rather than cash?
The same is true for your employees when they are issued a company credit card. For travelers, these cards are almost a necessity. For other employees, they are probably not.
A card makes it easier for purchases to be made without getting approval from anyone. Even if you have the most virtuous employees on the planet, why take any chances?
If you enjoy the convenience of sending assistants to the store to pick up supplies, then have one company credit card that can be signed out when they run errands rather than assigning a card by name to each employee.
Making wise financial decisions for your small business is one important thing that is going to help you succeed. Get the help you need, but never take your eyes off of the books. It’s YOUR small business. Make sure you know it well.