How You Can Spend Better to Do Better

It’s human nature for individuals to blame their troubles on everyone and everything but themselves, when, in fact, it’s their own ill-advised habits that are responsible. So it is for entrepreneurs. When cash-flow crunches occur, many of us look to others when we should be looking in the mirror. Our patterns and habits are getting us into trouble. It’s a wise entrepreneur who changes course and establishes practices that will more than likely avert catastrophes.

The optimal advance strategy for addressing cash flow is to operate in the least costly way. However, when you’re first starting out in business, this isn’t exactly top of mind. In the beginning, the focus is gaining sales. As stability is attained, however, you’re ready for the next level of thinking-optimizing expenditures. All long-term survivors in business learn to spend wisely.

Planning

No one likes the process of creating a budget. But fortunately, with an accurate financial history and computer spreadsheets, you can easily bridge the abyss between vague conceptualization and decisive action. At this juncture, it’s very useful to have outside accounting assistance to help you understand the best way to plan your budget.

Have a dynamic budget. Check your budget regularly and adjust it as things evolve; then you can see the opportunities. By contrast, poorly devised budgets are static, created early in the year, and seldom consulted again.

Marketing

At some point, businesses of all sizes get serious about marketing-especially Internet marketing. Spending more for online presence typically results in reduced marketing costs, particularly when considering the alternatives: the hidden costs of time spent trolling for prospective customers and closing sales.

A well-designed website allows prospective customers to understand you and your business. Optimal website features depend on how your audience finds you, and what they need to know about your business to make a purchase decision.

Spending too much for Web development is an obvious recipe for disaster. But spending too little is equally bad. Scrimping on this can create problems, and the cost of correcting these problems may be more than your budget can bear. Allocate a reasonable amount of funds for your Internet marketing, and use your dynamic budget to monitor these expenditures relative to revenue gains.

Sound marketing strategy entails more than your website. For instance, spending for market research is not just for big corporations. Spending on research actually targets your marketing dollars and eliminates wasteful spending. The results are measurable in your dynamic budget, as you add customers and increase revenue while minimizing cost.

Technology

Outsourcing bookkeeping tasks and getting professional accounting guidance are not impractical luxuries. They are necessities for the advanced business, and even-perhaps particularly-for the one-person operation. Cloud-based accounting, for example, is key to keeping informed on your status and having up-to-date records maintained by outsourced professionals. This method is efficient, inexpensive, and decreases the time you spend on accounting. Your focus shifts to revenue-generating activity and strategizing toward a more certain future. Where it should be.

The 4 Essentials of Successful SMB Accounting

A hallmark of a successful business operation is the ability to break patterns that are slowing your progress. Entrepreneurs don’t usually notice accounting problems until they arise. But you can anticipate and avert problems…if you follow the four essentials of successful accounting below:

  1. Consistency is the key to accounting. Avoid a haphazard approach. Know how revenue is recorded and how bills get paid, and ensure you use a consistent process to record them in a streamlined manner. Numerous methods exist for organizing financial records; decide on the best one for you and stick to it.
  2. Never put off your accounting. Just as you stick to a schedule for customer service, have a schedule for recording all transactions. Regularly maintaining current sales records, bills, miscellaneous receipts and customer accounts are must-dos. Contemporaneous accounting is best, but at the very least set aside a particular day each week or month to assure your accounting is up to date.
  3. Double-check everything; it’s crucial. Mistakes are particularly costly for the small business owner who has so many other things to think about. Correcting mistakes immediately is much easier than resolving errors later. In particular, avoid trying to correct at tax time.
  4. Know when to quit do-it-yourself accounting. If you’re stressing (or, even worse, ignoring) any aspect of keeping up your books, get professional accounting help.