5 Tips to Manage Finance for your Small Business

5 Tips to Manage Finance for your Small Business

Small business does not mean ‘small effort’. Managing small business finances is as complicated as the big ones. Your call, whether you want to start your business with your own or family’s capital or loan application from the banks

learn from the experts

Find Good Reference or Learn from the Experts

Running a small business is not easy and risky. Anyone can start a small business but how many people can actually sustain it? One of the best sources to learn about finance is through existing living proof. New business owners can analyze and learn how other businesses (same nature of yours) manage their finances. There are many businesses that actually willingly shared their success story or generally thought how the do their finance,

Other than that, they can also seek advice or take classes from experts in the business area. Invest a little bit on those classes as it will help in the long run in order to sustain the business financial health.

have a financial planning

Have a Business Financial Planning

A comprehensive small business finance plan includes budgeting, accounting, future prediction, tax planning and risk management.

Small businesses must analyze your businesses’ accounting reports and financial statements from time to time to gain insight into your business performance. This decides on what to set for the financial goals, whether needed to pump more money in the business. More money will be needed for expansion, buying new inventory or hiring staff.

Another important aspect is dealing with the tax. Ensure proper business bookkeeping to avoid a painful tax filing process in the future. In addition to understanding tax deductions, learn how to lower your tax burden as a small business owner.

business and personal finance separate

Keep Your Business and Personal Finances Separate

It is important to know everything about your company’s finances, stay on top of your accounting and maintain accurate financial records. Mixing business expenses with personal finances is the perfect recipe for creating disorganized records.

Keeping your personal accounts and business accounts separate will ensure your business is financially secure before investing. Not only does it make it incredibly challenging to keep track of money received and money spent, but it can also result in overspending as you may end up using your personal funds for business expenses and vice versa.

Important note, a clear separation between personal and business finances is also necessary so that you can claim tax deductions for various business-related expenses.

have adequate cash

Have Adequate Cash Reserve

For most small businesses, cash reserves are a critical tool for meeting liquidity needs. Cash reserves provide a readily available means to pay employees and suppliers in normal times and are an important buffer to draw upon during the trying period (like Covid-19 period).

Businesses with thin margins will have an issue or almost impossible to set up a cash reserve. You don’t want to be stuck in a position where you need to make business decisions based on the available cash balance.

The need to have a reserve cash that allows you to continue managing the business properly in times where inflows and outflows may not be perfectly matched is key.

whyq kirakira

Utilize 100% free and easy app, WhyQ KiraKira

WhyQ KiraKira app keeps track of your daily sales without expensive POS machines, tracks all your personal lendings, records daily sales and expenses and offers a great opportunity to apply for a microloan with low interest.

Rather than having your transaction records all over the place, the application keeps them all within the app. WhyQ KiraKira is undoubtedly your first pick for a simple yet all-in-one bookkeeping app, especially for small businesses who are saving some money. It is a one stop solution app that will cater for all the basic needs of your business’ bookkeeping system.

Work smart not hard when managing your small business finances. Keep your business operations running smoothly by working within your means. Don’t hire an accounting professional just yet, if you can use other alternatives like WhyQ KiraKira, Bookkeeping app.

Need more ideas & insights to grow your business, read WhyQ blog now.