When running a business, it is incredibly important that your financial management is controlled and succinct. Good financial management can be the difference between your companies’ success and failure and so it is vital that you take the appropriate steps to ensure that your businesses’ financial needs are met at all times.
What is Financial Management?
- Financial management is the control of your companies’ wealth and finances with the aim of securing these for the future. Financial management can include varied activities such as budgeting, calculating costs, researching your revenue and market, and implementing changes to control your outgoings.
What are the best ways to implement financial management?
- You should ensure that you have a clear business plan that overtly states the capital that you aim to take, your projected gross revenue, and the channels through which you intend to receive this.
- You should also send any invoices on time to ensure that you receive payment when you need it and when it is expected. This will help to enable you to adapt your processes accordingly. You should also follow up any outstanding payments after a pre-agreed number of weeks.
- You should track your finances at all times when running a business, through processes such as checking your bank balance, knowing of any outstanding payments, and ensuring that the right amount of sales are made. This will then help you to project your growth against the targets of your business and know when there is a problem early.
- You should also keep updated records of all of your expenditure including any outgoings such as rent and bills, as well as business expenses. This will allow you to easily see how much spare money you have to reinvest into your business.
What Tools Can Help You?
- Utility Bidder’s comparison and advice service can help you to keep track of the best offers on business utilities whenever you deem that your energy rates are too high. The expenses that you are paying out can affect your business and premises, and so you should ensure that you are getting the best rate for you through their online comparison service.
- To help you track your accounts quickly and easily and ensure that they are ready for the end of the tax year, you should look at investing in accounting software such as Quickbooks. These help you to create invoices and track your expenditure in an easy format, as well as helping you with billing and recurring payments.
- You should also consider investing in a budgeting tool as these can help you to create an unbiased and realistic budget that focuses on both your expenditure, necessary bills and the gross revenue of your business.
- You should also look at Cash Flow Analysis applications as these can help you to project the future finances of your business as well as ensure that your business has the correct amount of cash flow that you have expected. This will ensure that you are then prepared for every eventuality.