Is Your Company As Financially Efficient As It Could Be?
As a business owner, there is nothing more important than your finances. The truth is, the reason that half of all businesses fail in their first year of trading is because they don’t know how to budget effectively. No one wants to consider the idea that their business might not make it. But if you aren’t smart about how every last penny is spent, you could run into problems.
Obviously, running a business can be expensive, which is fine as long as you have the mindset to budget effectively. The key thing is to understand is how essential it is to ensure that your business is as financially efficient as possible. This means being smart about your spending and making sure only to spend where necessary.
To help you do that, here are a few tips and tricks to make being financially efficient a little easier.
Keep personal and business funds separate
The first rule of business is always to keep personal and business funds separate. The reason for this: so that you’re able to track your spending better. You may not have thought about it, but if all your money is in one account, it’s easy to overspend because it seems like you have more money to play with.
If you have a separate account – ideally a business one, for your company spending, it will be easier to keep track of what you have to work with. To make this even easier, there are some amazing business finance apps on the market. Things like Expensify and inDinero can be incredibly useful tools to have.
Be smart about the services you invest in
It’s no secret that for small businesses outsourcing is crucial. However, that doesn’t mean that you need to hire every service there is, instead, be smart about the services you use. Search around the compare prices, to ensure that you’re getting the best deal. Don’t just continue to use a service, take the time to ensure that it’s performing as it should do.
Take, for instance, your marketing method of choice. To check whether the marketing you’ve invest in is doing what it should do, use call tracking. This is an effective tool as it will show you where each call is coming from, allowing you to see which marketing methods are working effectively. Those that aren’t performing as expected, stop using to save money.
Ask yourself ‘do I need this?’
Before spending a penny, always ask yourself whether it’s necessary. As a business owner, the chances are that you’re on a tight budget, which means that you should only spend what you absolutely have to. Before buying anything, beit a product or service, ask yourself if it’s necessary. If it is, think about how you could make it cheaper or even get it for free.
Say, for example, you want Microsoft Office for invoices, spreadsheets, and powerpoints. Instead of spending hundreds on it, opt to use Google’s alternatives – Google Docs, Google Sheets, and Google Slides. It’s free to use – all you need is a Gmail account. Most apps have ‘lite’ versions which are free. So instead of opting for premium download the lite version – most of the time they pretty much do the same things.
Being smart about your spending is crucial if you want to see your business make it big. It would be a real shame if your company wasn’t able to go the distance simply because of money. That’s why it’s so important that you’re as financially efficient as possible.