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7 Tips for Managing Small Business Finances

September 17, 2021

Two keys to ensuring your company is financially healthy are education and organization, especially with your finances.

Although managing finances can be challenging and feel like a chore, a business is often most successful when all financial aspects are in order.

By understanding the basic skills needed to run the financial aspects of a small business, you can create a solid financial future. A few essential skills include simple financial tasks, applying for a loan, or drafting statements.

As a business owner, you will face many challenges, and correctly managing your finances can help to alleviate many of them.

You can implement these tips into your day-to-day operations to manage your business finances more effectively.


  1. Pay yourself

Although it sounds simple, small business owners sometimes miss paying themselves because any leftover cash gets pumped back into the business and operations.

Keep in mind the role you play in the company, and pay yourself in the same way as any other employee. There are a variety of ways to pay yourself such as salary or owner’s draw.

Paying yourself is vital to keeping personal and business expenses separate and healthy. If the business does not work out, you will find yourself in a troubling situation without paying yourself for the work you did.

Though it appears more important to put every penny into the startup, a struggling personal budget will impact the business and create future issues.


  1. Dedicate time to an Intro Accounting course

Every business owner knows how important it is to never become complacent with your knowledge. It should be a priority to continue educating yourself, and an introductory accounting course is a great place to start.

If you have an accountant or bookkeeper, you may not see this as a beneficial use of your time, but understanding the basics of business accounting could come in handy if there is ever a period where you no longer have these positions filled. Your business cannot stop running, and neither can your finances.

You can take a course online for more schedule flexibility or at a community college for an in-person option.

By taking this course, you will learn accounting fundamentals such as how cash moves through the business, revenues, expenses, income statements, and accounting debits and credits with record transactions.


  1. Set up a filing system

A filing system will look different for every business owner.

You have paper and digital filing options available, and both will help with organization. For paper filing, you can use a filing cabinet to store all files, and you can use document organization software for digital filings such as Content Central or DocuPhase.

Some items you should keep include accounting/bookkeeping records, bank statements, contracts, permits, employee records, licenses, and tax papers.

Organizing these files based on years will help keep each category organized and make finding any document easier.


  1. Schedule time to stay organized

Keeping organized is easy if you schedule time for the task on your calendar, and you can do this weekly or monthly.

You can use this time to file receipts and tax documents or pay bills and send out invoices.

The key to staying organized is prioritizing it on your schedule the same way you would for any other meeting or task.


  1. Take advantage of the technology around you

Mobile apps make it easy to keep some aspects of your business finances organized.

Consider using apps such as:

  • Receipts with Wave: keeps digital track of all receipts by attaching an image of them from your mobile device. It allows you to access transaction details for any expense at any time. It meets legal record-keeping requirements, provides supporting documents in the case of an audit, and stores proof of your deductible expenses.


  • MileIQ: Automatically captures your drive miles to create a comprehensive record of your travel. The app allows you to classify a drive as either business or personal and add details such as tolls or parking expenses. It then sends you weekly reports of your mileage.


  • Shopventory: creates and manages your inventory items using features such as variants and pricing or product photos. You can also track related products and optimize your inventory.

These apps simplify and organize day-to-day operations, so you can find the information you need with ease.


  1. Develop an effective billing strategy

Every company will experience challenges collecting payment from several clients or customers at one point or another. When this happens, the invoice must be collected creatively.

For example, you might create a reasonable payment plan for the customer or charge a late fee per week they are late.

Additionally, you can try deducting a few charges from the invoice and give them a week to pay it, and if they do not, the invoice will go back to the original amount.

Ultimately, working with the consumer’s ability to pay you will ensure they eventually pay their balance, whereas continuing emails and phone calls may not be successful.


  1. Gain access to business credit cards

Often, bankers will recommend business owners get access to business credit to help when they lack cash flow or as a way to start a business.

A variety of business credit cards offer zero interest introductory offers for up to 18 months, so if cash flow is restricted or you are just getting the business started, having a zero-interest funding option will be the best option.

Business credit prevents you from giving up equity in your business like some private lenders may require and can be used for any expense within any industry, including real estate investing, trucking, digital marketing, e-commerce, doctors, lawyers, and service!

Knowing which credit cards offer the best zero interest offers, rewards, and the highest initial approvals can be challenging, so having an expert in your corner would be beneficial.

Fund&Grow has been helping entrepreneurs and business owners access zero-interest business credit since 2007 and has generated over $1 billion in funding for clients. Some gain access to $60,000 within two weeks of starting the program!

Managing your finances includes finding the best option to fund your business to avoid costing you thousands in interest.

The more you understand your business finances and cash flow, the easier managing them will become. These tips will help you manage your finances easier and prepare for any financial challenge – big or small.


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