Tips on how to manage small business finances.
Financial management can be daunting. Here are just a few useful tips to help make managing your small business finances simpler.
Proper financial management can make or break a business — a company can’t operate without funds, after all. Managing business finances is far from simple, especially for new startups. These introductory tips on how to manage business finances can help make the task easier for small businesses.
Open a business bank account.
Have a separate bank account for your business income and expenses, particularly if you operate as an LLC or a corporation. Mixing personal and business finances can cause issues when you pay your taxes.
Have a clear billing system.
Send your invoices out as soon as you can once you finish work on a project or sell your goods. Keep track of all invoices to make sure your clients pay you on time.
Set money aside for taxes.
Put at least 25% of your monthly earnings aside, preferably to a savings account. This way you’ll ensure that you have enough money to pay your quarterly taxes when they’re due.
Don’t avoid loans.
No one wants to owe money, but loans can be vital for getting your business started. Besides, it’s better to get a loan before you’re in dire financial straits — no bank wants to loan money to failing businesses.
Keep a balance sheet.
It’s essential to closely monitor your income and expenses, not only for taxes but also for your general business viability. Once you know your average monthly profit, make sure to plan ahead to stay competitive.
Take advantage of software.
Good business software makes managing business finances much easier. Adobe Acrobat, for example, lets you convert business documents and spreadsheets into PDFs that are easy to share and view on any device. You can also protect sensitive documents — like tax forms — with passwords and redact information, both offline and online.
Discover many other ways Acrobat can help you run your business better.