Most of the difficulties of a company come from poor management or accounting. Paradoxically, it is to this area that entrepreneurs provide the least effort. Indeed, entrepreneurs who lack training in business management prefer to spend their time on more exciting activities: selling, customer care, communication, products (which is understandable). That is why we suggest a few tips to follow for a successful small business accounting.
Small business accounting is not only about numbers
This point is the first because it is the most crucial. Small business accounting is a tool not the main objective.
It is true that most of it has to do with keeping track of what comes in and what goes out of the business. However, if you look closer at the information small business accounting gives you, you should be able to see trends in sales and expenses for example. When you focus on the long term trends, accounting becomes more useful and interesting. It tells you what happens every day, it highlights the problems, but it can also help you to solve those problems. You can make small business accounting if you only changed the way you look at it.
Two: Incorporate small business accounting into your regular activities and keep it consistent.
A good way to manage accounting when you are a small business owner is to make small daily or weekly routines. Every Friday for example, review all expenditures and all receipts of the week. Place all the checks in the bank every Monday. Keep track of accounts receivables each Tuesday. Etc. By reserving an accounting task per day and by being consistent, you are able to monitor and update your accounts in an almost playful way. It is a task among many others.
Examples of small business accounting tasks to perform regularly:
Verify what your fixed costs will be for that month and anticipate for the following. Pay attention to what you spend this and the last month. Make sure you verify all credit card payments. Keep track of accounts receivables. Remember to send the invoices to the customers. Ask your accountant to verify the work you do. Keep track of cash flow trends, etc.
Small business accounting is not only about numbers
This point is the first because it is the most crucial. Small business accounting is a tool not the main objective.
It is true that most of it has to do with keeping track of what comes in and what goes out of the business. However, if you look closer at the information small business accounting gives you, you should be able to see trends in sales and expenses for example. When you focus on the long term trends, accounting becomes more useful and interesting. It tells you what happens every day, it highlights the problems, but it can also help you to solve those problems. You can make small business accounting if you only changed the way you look at it.
Two: Incorporate small business accounting into your regular activities and keep it consistent.
A good way to manage accounting when you are a small business owner is to make small daily or weekly routines. Every Friday for example, review all expenditures and all receipts of the week. Place all the checks in the bank every Monday. Keep track of accounts receivables each Tuesday. Etc. By reserving an accounting task per day and by being consistent, you are able to monitor and update your accounts in an almost playful way. It is a task among many others.
Examples of small business accounting tasks to perform regularly:
Verify what your fixed costs will be for that month and anticipate for the following. Pay attention to what you spend this and the last month. Make sure you verify all credit card payments. Keep track of accounts receivables. Remember to send the invoices to the customers. Ask your accountant to verify the work you do. Keep track of cash flow trends, etc.
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