When you are trying to grow your small business, finding ways to streamline your finances can be the difference between achieving your business goals or not. Unfortunately, most small business owners are so busy managing the everyday aspects of their business that they don’t take the time to review their finances or look for ways to strengthen their financial position.
Here are seven simple steps to help you get your finances in order and on track to supporting your business growth goals.
1. Have a business plan
Whether you are a start-up business or an established SME with goals of business growth, it’s essential to have a current business plan in place. Writing your business plan doesn’t have to be overly complicated, it can be a one page business plan – but it should be a realistic outline of your business goals that guides your business activities, marketing and finances.
2. Set a budget
Part of having a realistic business plan is having a budget. Setting a budget will help you identify your financial goals and help you to keep account of how you are tracking against your business goals and forecasts. Make sure you have the right small business accounting processes in place to track your cash flow and expenditure against your budget on a regular (e.g. monthly or quarterly) basis.
3. Understand what government support for small business is available to you
At any given time there are a range of government business loans, stimulus packages and other small business government assistance measures in place – such as the SME Guarantee Scheme (SMEG), the Instant Asset Write Off (IAWO) and Temporary Full Expensive (TFE) initiatives, and the Boosting Apprenticeship Commencements wage subsidy – to support small business owners, it pays to understand what government help for small business is available to you.
4. Review your expenses
Look into the day-to-day costs of running your small business to identify opportunities to reduce costs or streamline systems and processes to deliver your products and services more efficiently and profitably. For example, do you have a long-standing business account that is no longer the most cost-effective option on the market? Are there any technology solutions available to replace any outdated practices that are draining time and resources from your business? Take a holistic approach to cutting any unnecessary expenses across your business operations – and ask for help from your tax accountant or financial adviser if needed.
5. Clean up your accounting
If you're spending days or even weeks gathering receipts and filling out forms when tax time rolls around each year, it may be time for your small business to have a ‘paperwork Spring clean’.
Sorting out your business banking and other vital paperwork is important but can often be pushed aside when customers are demanding your attention. So, make sure you take the time to get your documents and small business finances in order.
Look at your small business accounting practices and try to find ways to streamline the process. It’s also worth investing in accounting software such as Xero or MYOB. Alternatively, you may want to outsource to an accountant or financial adviser who has experience working with small business owners.
6. Negotiate a better deal
Just like it pays to look at where you can save money in terms of your operating costs, it’s also worth approaching your landlord, bank and suppliers to negotiate a better deal. If you've been a loyal tenant or customer for some time, you could ask your landlord to look at rental assistance and see if your debtors could drop their rates or offer discounts. It’s also worth taking the time to compare business bank accounts and business insurance quotes or talk to your bank to ensure you have the best business account to support your small business banking needs.
7. Clear any debt you can
Although it can be difficult for many small businesses to clear debts of any kind when you are trying to grow your business, it is still worth looking at how you may be able to chip away at them. Try knocking back any high-interest business loans or credit card debt first or try to completely clear the smallest debt to kick-start the payment momentum. Talk to your accountant about what the best options to support your business structure and goals are.
Contact us to find out more about how BOQ Business can support your small business.