Just starting out with your business? There’s one thing you need to know now to increase your chance of survival over time: managing cash flow.
Cash – and the availability of it – is crucial to any business, but even more so when you’re lifting off and getting the wheels turning. You need to have access to a steady flow of money to have purchasing power or to give yourself some room in the event of an unforeseen situation – things come up all the time when starting a business and you want to be prepared. Here are some essential tips for starting a business off on the right foot and properly managing cash flow:
- Keep track of records – The only way to make accurate business decisions is to know exactly where you stand financially. Using cloud-based accounting software means you have access to your records anytime, anywhere. Track invoices, payroll and all other financial aspects consistently to ensure you’re managing cash flow correctly.
- Budget – Budgeting isn’t just something you do with your personal money, it’s very important to do for any business starting out. While you have a desire to purchase anything and everything you think you’ll need, it’s a dangerous way to run out of money early on — keep track of spending and only spend what you need.
- Make sure you get paid – Managing cash flow means getting paid on time through invoices from clients. Collect outstanding debt quickly and use accounting software to help create, track and close invoices efficiently.
Always monitor expenses and profits as you go – tracking it will help you see patterns or changes with cash flow so you can make adjustments. Managing cash flow is about knowing where you stand with your money and making changes proactively so you don’t end up sinking those first few years of running a business.
Contact Galaxi Bookkeeping for a consultation and be sure to visit us on Facebook!
Passionate about small business, cloud technology & travelling the world.