How to manage your small business finances more efficiently
In the days before the technology boom of the 2000s, we might have had to wait for a TV or radio traffic report to plan the fastest route to a meeting, or call an airline or talk to a travel agent in order to buy a plane ticket. But with tools and apps that allow us to tackle tasks in new ways, today we can do more in less time. And that holds true for small business owners, too.
However, while you may understand the importance of time management – using a calendar app to help you plan your day, and using your virtual personal assistant to help you stay organized while you’re on the go – one area that small business owners often overlook is how much time they spend on managing their finances.
If you're not sure how much time you spend on your own small business finances, consider this: According to a SCORE.org survey, 40 percent of small business owners spend at least 80 hours a year on taxes, payroll, contracts, and working with accountants. Now imagine, if you could re-allocate some of that time to other parts of your business, or even your personal life. Fortunately, with a few modern tools, it's not only possible, but easy. Three of the types of solutions that can help you gain some of that time back include:
- Budget Templates: Whether you're building your company's first budget or revising it for the 10th time this month, with budgeting templates, you can save time and create a well-organized budget that gives you detailed insights into your expenses – and your income. Some software even offers templates for overall budgets, as well as the option to break out expenses for things like specific product lines and special events. This way, you can get a clear view of your spending and manage your small business finances like a pro.
- Invoicing & Payment Tracking: Some of the best time-saving apps available to small business owners are the ones that allow you to send invoices, accept digital payments and track those payments from a single dashboard. By eliminating the need to create invoices by hand and either mailing or emailing them to your clients, then waiting for a check in the mail (or a call so you can accept payment over the phone), you can save time and money. And, because invoicing and payment apps usually allow you to send reminders to clients, answer billing questions, etc., directly from the dashboard, they give you a fast, easy way to stay in touch.
- Automating Mileage: As a small business owner you're always on the go – and whether you bill your mileage to your clients or include it in your annual tax deductions, tracking it accurately is critical. Of course, it's also easy to forget. So, look for an app that does it automatically – directly from your phone – every time you hop in the car. With the power to map and track where you've been, mileage apps can help you know what to bill, what to deduct, and what mileage belongs to you, personally.
In addition to choosing (and using) modern tools that allow you to manage your finances more efficiently, small business owners should always be on the lookout for help from those who understand the economic climate and the issues that small businesses face. And this is where organizations like the Small Business Administration (SBA) and SCORE can help. With time management tips, plus information on mentor programs, tax codes, starting and building a business, and the latest business management tools and financial programs, organizations like these can help you succeed in today's ever-changing marketplace. And because most, if not all, of their programs are free, you have nothing to lose by contacting them.
The Growth Center does not constitute professional tax or financial advice. You should contact your own tax or financial professional to discuss your situation.