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Small business owners are no strangers to cash flow problems. Even the most carefully prepared budget can end up a burden through unforeseen circumstances or, circumstances that you should of seen.
QuickBooksOnline have shared their three top tips to help small business owners keep control of their budgets. Here’s how to be better prepared.
Create an early warning system
Getting a good handle on the finances is one of the most crucial jobs of a business owner and creating a financial plan is key to creating a safety net.
When creating a financial plan, business owners need to make projections for the coming months, forecasting income and expenses. These projections will act as an early warning system, helping businesses plan for cash flow dips, identify financing needs and help pinpoint the best timing for projects.
How technology can assist you
Mobile technology is transforming small businesses across the country, everyone from tradies to retail owners are using technology solutions to reduce time intensive manual processes.
One of the great advancements has been in cloud accounting software; business owners no longer need to spend hours trawling through paper invoices and spreadsheets. Cloud accounting automates complex tasks, saving money, increasing productivity and eliminating the manual processes that can cause errors.
QuickBooks Online helps with everything from creating quotes and invoices, through to tracking sales and expenses, plus monitoring and managing GST and BAS.
Give yourself a contingency plan
Planning is one of the most important parts to minimising budget blowouts. A contingency plan will allow a business to respond effectively to an event or situation that might happen in the future. These risks can appear at any time and minimising them is an essential part of planning.
One of the simplest ways is to reserve some profits. If you spend profit as quickly as it comes in, when an unexpected event or loss hits the business you might find yourself suddenly in the red. Reserving some of your profits is one of the smartest things business owners can do.