The Serious Consequences of Bad Bookkeeping on Your Small Business

There are many things that you need to worry about as a small business owner. Not only are you evaluating cash flow to make sure that you have enough money for payroll, but you are also carrying the burden of overseeing employee management, budgeting, business development, customer service, marketing, and more. These responsibilities can add up, making it easy for important tasks to slip through the cracks. Certain tasks can be handed in the future, but don’t procrastinate financial matters resulting in a situation where you are facing bad bookkeeping practices.

Bookkeeping and accounting encompass all aspects of the financial side of running a business. It is essential that you are tracking the money that is coming in and going out so that you have detailed information for tax filings, profit and loss reports, and more. Without the right financial tracking, you are setting your business up for failure.

Some small business owners attempt to manage bookkeeping in-house. If you have professional experience as an accountant, then you might have the skills to handle these responsibilities. Even though you have the skills, there are advantages to outsourcing these tasks. For example, it can be a challenge to keep up with the changing tax laws and other factors that impact your finances. Plus, most business owners don’t want to spend their free time crunching numbers.

What Do Accounting and Bookkeeping Encompass?

Many aspects of your business fall under the umbrella of bookkeeping and accounting. If money or value is changing hands, then these details need to be addressed by your accountant. These transactions can include everything from payments and earnings to purchases, sales, and receipts.

The goal of your financial system is to track the money that is flowing in and out of your business. Every penny needs to be accounted for to ensure that you are making the right decisions to support the future of your company. This information is necessary to help you with tax calculations. Additionally, you need accurate reports so that you can calculate your profits and make good decisions regarding the spending and business plan for your growing company.

Are There Problems with Your Financial Records?

Jotting down a transaction on a piece of scrap paper isn’t good enough for your financial tracking. Instead of “getting by” with unproven systems, right now is the perfect time to implement an effective accounting and bookkeeping program. This step will help you overcome some of these common mistakes that happen when an inexperienced person handles bookkeeping for a company:

  • Lack of consistency where transactions are recorded
  • Hand-written accounting, instead of using a computer system
  • Only using manual calculations
  • Overlooking small transactions
  • Missing tax payments and paperwork
  • Lack of communication with a bookkeeper or accountant
  • Organizational problems causing lost invoices and paperwork
  • Falling behind on data entry
  • Failing to complete regular audits and checks
  • Hiring an inexperienced person to do the bookkeeping

Tracking your financial records might be the most important thing that you can do to support the future success of your company. If you let these tasks fall to the backburner, then you will face big challenges that need to be overcome before you can lead your business to the goals that you desire.

Why Do You Need a Bookkeeping Professional?

It seems easy to hire a secretary to oversee the financial transactions. Isn’t it easy to do a little data entry from the receipts and sales invoices? Yes, a low-level employee can oversee some of these tasks. But, they need the training and understanding to make sure that they aren’t missing important parts of the financial tracking.

In addition to the daily data entry, it is also important that higher-level strategy is used to plan for the future. Not only do you need to assess cash flow and profit/loss reports, but you need to be prepared for tax filing. Correct information on your financial reports will have an impact on the taxes that you pay and the amount of money that you can save due to write-offs

An experienced bookkeeper could cause a domino effect that impacts many aspects of your business. Even though a missed transaction or mathematical error might seem minor, it can play a big part in the accuracy of your reports in the future. When it comes to finances, it is essential that you have an expert team overseeing every detail. Hiring a professional accounting and bookkeeping service not only ensures the accuracy of your reporting, but it also helps with the long-term success of your company.

What Will Happen if You Have Bad Bookkeeping Practices?

If you don’t know a lot about accounting and bookkeeping, then it is possible that you don’t understand the serious implications of bad bookkeeping. Here are a few consequences that you might face:

  • IRS Audit: Resulting in time, stress, and money for accounting services to work through the audit. If incorrect information is discovered on your tax filing, then it is possible that you will be facing expensive fines and fees that could negatively impact your current cash flow. The best solution is to have an experienced accountant who will help you follow the rules and avoid the risk of an audit.
  • Cash Flow Problems: What will happen if it is time for payroll and you don’t have enough money in the bank to pay your employees? Costs come up every month for business development, payroll, office supplies, and more. If you aren’t tracking your inflow and outflow, then you might be caught in a difficult situation where there isn’t enough money to pay the bills. These problems can be avoided by hiring a good accountant who will track the records and help you avoid cash flow problems.
  • Poor Business Decisions: How can you make accurate decisions for your company if you don’t understand the current financial health of the business? When you are facing decisions about hiring employees, business development, or marketing costs, you need an accurate picture of the financial health of your company. This information is essential so that you can run financial reports and then make decisions based on the current financial trends that you are experiencing.

Important Principles of Good Bookkeeping and Accounting

So, what should you be looking for when you are ready to hire someone to help with bookkeeping and accounting? First, make sure that you find a team with many years of experience in the industry. You need an accountant with hands-on experience working with other small businesses. For example, you will get better results hiring an accounting team that focuses on small business services, instead of hiring someone who usually does personal tax filings.

Next, it is important that your accounting and bookkeeping team has a good system that is implemented to track financial transactions and generate reports. Everything should be done using a software program, instead of using hand-written records or manual tracking on a spreadsheet.

The system needs to be able to categorize expenses so that you know how much you are spending on various things. Breaking down these details can help you see where you are spending the most money on unnecessary costs. You can also evaluate the most profitable aspects of your company, helping you maximize cash flow by focusing on the activities that are bringing in the money.

A good accounting system needs to account for every penny that moves through the company. There are also taxes and other things that need to be accounted for as well. For example, sales tax, quarterly tax payments, and other details need to be tracked and paid along the way.

Finally, it is important that your accounting team offers a reconciliation of your bank accounts. Even if you are consistent with data entry for the transactions, there are times when the numbers are off, and everything needs to be adjusted. These small discrepancies can be identified if regular reconciliations are happening. This effort is basically a small audit to make sure that all of the accounts match up and everything is in alignment.

Don’s Stress Over DIY Accounting

There is no reason why you should be handling the stress of managing the accounting for your company. As the business owner, you have enough to worry about for the business development, employee management, and more. Let a professional team of accountants and bookkeepers oversee the financial tracking for your company, freeing up your time to focus on other activities that will help your company grow,

DIY accounting is often a bad idea because it results in many problems with inaccurate reports and missed transactions. Instead of making a mistake by handling the accounting in-house, it is better to hire an outsourced team to help.

The Easier Accounting team is experienced in all aspects of small business accounting and bookkeeping. If you need a trusted team to help with your company, then we invite you to call us today to learn more about the services that we offer. We are here to help with the financial success of your company: (888) 620-0770

The Effects of Bad Bookkeeping on Your Small Business

As the owner of a small business, it is important for you to know that seemingly small mistakes can lead to serious financial damage in the future. Larger corporations have the big bank accounts to cover these types of mistakes. But, smaller companies might go under if the wrong accounting and bookkeeping practices are in place. If you want to increase the chances of success in the future, then you need to make sure that you are building the foundation with solid bookkeeping and accounting support.

Why Bookkeeping Matters

Why does it matter if you have a good bookkeeping team to help with your business efforts? These services encompass some of the most essential tasks that need to be addressed in every company. Without a good bookkeeper, your books will be a mess, and you won’t be able to keep up with the numbers in your bank account.

Typically, bookkeeping encompasses a variety of services to ensure that all financial transactions are recorded. These services can include sales, receipts, purchases, payroll, payments, earnings, and more.

Having a bookkeeper stay current with these transactions ensures that the money continues to flow in and out of your business as needed. Not only will you have the money moving through to support business efforts and profits, but you will also account for every dollar that is spent or received.

Later, you can use the information when you are making big financial decisions that impact the future of your company. If you are putting together anything that will affect the organization of your business, then you need to be sure that you are staying ahead of these details. Then, you can lean on the financial reports knowing that the numbers are accurate.

Bookkeeping, Accounting, and Business Decisions

What will happen if you aren’t keeping up with the bookkeeping and accounting tasks that need to be addressed in a small business? Every decision that you make can have an impact on the profitability and cash flow of the company. If you make too many bad decisions, then it will lead to the downfall of the business.

At the same time, a series of wise decisions will lead to the future success that you desire. So, you need to stay apprised of the numbers to ensure that you are considering these details whenever you make a decision.

The financial reports in your company should be used when you are looking at monthly or annual revenue, considering loans or payments, calculating and paying taxes, buying new equipment, or hiring more employees.

Consider this situation: it might be a good month in your company, resulting in an influx of cash in your bank account. Even though the numbers are high, it doesn’t mean that you have extra cash to spare for new office equipment or furniture. Instead, you need to look at the reports and anticipate any potential upcoming payments for payroll or taxes.

Failing to consider these details could leave you in a situation where your bank account is overdrawn because you spent money that wasn’t really available for your business. Bad bookkeeping practices will leave you in debt, and you could potentially be in trouble with the IRS if tax payments and other details are missed.

Biggest Accounting and Bookkeeping Issues for Small Businesses

What are the biggest issues that you might face for your small business? These are some of the leading causes that can result in financial problems for your company:

  • Not being serious about your bookkeeping or accounting practices
  • Procrastinating important daily, weekly, and monthly tasks
  • Leaving the financial accounting to a low-paid, inexperienced employee
  • Overlooking small transactions
  • Failing to communicate with your accountant
  • Spending money that is needed for taxes or payroll
  • Inefficiencies in regular work systems

In addition to efficient, effective bookkeeping and accounting practices, you also need to make sure that you are implementing good management over your staff and employees. Set expectations, teach the right techniques, then ensure that everyone is following the same practices in the way they are handling sales, data entry and more.

Financial Mistakes that are Costing You Money

Many common financial mistakes will cost your company money. Not only will you lose out on cash upfront, but some of these mistakes could potentially lead to the downfall of your company. Here are some of the most common financial habits that you need to avoid:

  1. Not Hiring an Experienced Bookkeeper: It might seem like a great idea to pay your niece $15 per hour to do the books. But, a lack of experience is one of the top causes of poor record keeping. If you are handling bookkeeping and accounting in-house, then it probably means that mistakes are happening regularly. Even though you might feel like you are saving money on the cost of payroll, you will end up paying more in the future when you need to hire an accounting team to clean up the mess. Don’t trust an inexperienced employee with the important task of managing the financial records for your company. Instead, hire a professional team who can eliminate some of the common errors that occur. Outsourcing is a great solution to help you save money and reduce your stress at the same time.
  2. Procrastinating the Bookkeeping: When things get busy in the office, paperwork and bookkeeping are often the things that fall to the backburner. If a customer needs immediate attention, then you aren’t going to turn that person away so that you can focus on the data entry! So, many business owners let the bookkeeping slide until they finally make it a priority to get caught up on The problem is that procrastination can lead to serious issues in the future. Not only will you miss some of the transactions, but your business can be crippled because you are making decisions without assessing the full financial information.
  3. Skipping Tax Payments: Tax deadlines are important to ensure that you aren’t missing anything important for the IRS. There are specific deadlines that need to be met for payments, filing, paperwork and more. Don’t run the risk of facing an IRS audit in the future! Instead, work with an experienced accounting team to ensure that you are keeping up with the ongoing deadlines and requirements. If your bookkeeping is a mess, then it means that you are probably paying the wrong amount on your tax deadlines. Or, you might run into cash flow issues that make it difficult to pay the taxes when they are due. Avoid issues with the IRS by hiring a professional accounting team instead.
  4. Ignoring Cash Flow Issues: Sometimes it can be a challenge to keep up with business payments, which means that you might be facing cashflow issues throughout the year. While these problems seem small, they can have a big impact on the future of your company. Always putting things on the business credit card can lead to high-interest costs and major problems down the road.
  5. Manual Calculations: Spreadsheets can be useful for many reasons, but they shouldn’t be used for your bookkeeping or accounting system. The risk of errors increases if you are using manual data entry and other methods to manage the bookkeeping. Instead, implement an accounting software that uses automated systems and checks and balances so that you can overcome the domino effect of manual errors.

The Long-Term Issues of Bad Accounting Habits

A few small financial issues right now won’t bring down your company. But, these problems can lead to major issues in the future. If you want to create a successful business in the future, then the financial tracking and planning is a critical part of your long-term success. Failing to keep up with the numbers is one of the biggest mistakes that you can make as a business owner.

Luckily, many tools and services can be used to simplify the process. Don’t be afraid to hire help or pay for the right accounting software. These systems are important so that you can free up your time and focus on the other tasks that matter for the future growth of your company.

For example, outsourcing the bookkeeping and accounting tasks will enable you to focus on product development, customer care, and employee management. All of these factors can lead to more sales and higher revenue. Your business will continue growing, and you can enjoy the fruits of your labors.

If you need assistance with the bookkeeping and accounting systems for your company, then you need to call the best team in the industry: Easier Accounting. We offer the support that you need to keep your business running throughout the year. In addition to the daily, weekly, and monthly financial tasks, we also offer tax planning and filing. Our goal is to take care of the financial details so that you can be ready for massive growth and business success in years to come. Call us today to learn more about the services that we can provide for your company: (888) 620-0770

Boost Your Bottom Line By Improving Customer Experience

Customers are the greatest asset to your business, which means customer experience should be a focus in your company. If your customers are happy with the services that are provided, then they will keep coming back in the future. But, a bad experience can get in the way of potential sales, and even cause the person to spread negative information about your company.

Building Trust Through Customer Experience

When a customer decides to buy your product or service, then it means that you have helped them see the benefits that your company offers. Often, the purchase point is the last step after the customer moved through a marketing funnel. At the same time, the sale is also the first step to building a long-term relationship with that person.

By understanding what your customers want, you can adjust your sales points to cater to their needs. This journey is a process that leads them to make a purchase. Getting clarity on the decision points will help you engage customers more effectively, which in turn boosts sales and improves your bottom line.

Get Rid of the Busy Work to Focus on Essentials

As a business owner, you should be looking at the tasks that can help you improve your cash flow and profit. Which means that you need to take it back to the basics by providing the services that the customer needs. If you are so caught up in bookkeeping, inventory, and profit and loss reports that the customers are neglected, then your business won’t achieve the long-term success that you desire.

One option you might consider is to outsource the busy work so that you can focus on the important tasks that will help you connect with the customers. For example, hiring a bookkeeping and accounting team is a great way to free up your time, because you don’t have to focus on data entry and number-crunching. Instead, you can look at the front-line interactions to see how the customers are responding to your marketing and outreach efforts.

Solving Problems for Potential Customers

Most people buy because they are looking for an effective way to solve a problem they are facing. For example, someone buys a toy when they need a gift for a party. Or, a visit to a hair salon happens when a person wants to have a boost in their confidence. Whether you are selling services or physical products, you need to understand the psychology behind WHY people choose to spend money on the things that you are selling.

Before you have the opportunity to interact with a customer, they need to have the self-realization that they are looking for the product or service in the first place. Bringing awareness to the topic will increase their interest in the industry, making it easier to bring the person to the point of sale.

Once the awareness is present, then that person might come across your company on social media, in a Google search, or through an in-person interaction. Then, your branding efforts increase the possibility of business recognition when they are ready to make a purchase.

Staying Connected with New Customers

In most situations, the customer will not purchase at the first point of contact. Just because they found your website online, doesn’t mean that they are ready to pull out their credit card. So, you can’t make sales projections for your accounting reports based on the website visitors that are coming through. Instead, you need to continue collecting information to see the trends and conversion rates that can be expected.

Collecting the customer’s information at the point of contact is a great way to increase the chances of a future purchase. This information could be in the form of adding their email to your newsletter or connecting through a social media account. Then, you can share helpful information through these platforms to continue building trust and a long-term relationship with that person.

When the customer is looking for a solution, they will remember the Instagram post or recent newsletter that talked about how your service could help with their issue. Since you previously focused on the problems that people are trying to solve, then the content that is shared can be catered to match their needs. This consistency increases the chances that they will pay attention to your messages, and reach out when they want to buy something.

Ongoing Outreach to Current Customers

Just because someone made a purchase, doesn’t mean that they don’t need coaxing to come back again in the future. There are many industries with stiff competition, which means that you need to step up your game if you want to stay ahead of the pack. You can improve your business success and boost the bottom line by helping current customers see why they need to come back and buy again.

Compare the cost of marketing and bringing a new customer in with the expenses that you might put into outreach for current customers. You will see that it is much cheaper to get a repeat sale than it is to bring in a new customer. Be wise with your marketing spending, and make sure that you don’t neglect the people who are already on your list.

This process allows you to manage your marketing expenses, which in turn helps to boost cash flow and minimize costs. At the same time, you can increase sales by bringing people through the door over and over again. The final result is exactly what you desired: financial strength in your company and a business that thrives for many years.

Be Honest in Your Communication

If you make a promise or guarantee about your product, then make sure that your communication is clear about what the customer can expect from your company. One important aspect of customer experience is ensuring that you have a solid customer service plan in place, to help before, during, and after the purchase. Don’t be worried if concerns or problems come up with the purchase because it is easy to make things right when you have a proactive customer service team.

In fact, high-quality customer service is one of the best things that you can do to improve customer experience. People want to feel like they are noticed and heard. This hands-on approach in your business will make it easy for you to improve customer satisfaction. Even if your product is a little more expensive compared to the competitors, customers will keep coming back because they felt good when they interacted with your company.

Happy Customers Lead to Great Referrals

Not only will that person come back to buy again in the future, but they will gladly share information about your company with their friends and family. Personal recommendations are a powerful way to boost business success, helping to increase sales and improve your results.

But, you can’t focus on referrals without offering the highest level of customer service. People will only make referrals to your company if they felt like they had a good experience. Being genuine in your interactions with customers can be a great way for you to grow your company naturally.

Look to the Future

In addition to the current efforts for customer outreach and quality customer service, also look for ways that your company can grow and expand. It can be helpful to have an experienced accounting team who will provide the right reports to guide your spending decisions. You can refer to your cash standing and outlook for the future when you are deciding on important factors such as investments, inventory, hiring employees, and more.

It can be hard to understand the financial standing of your company without talking to an accounting professional. Instead of crunching the numbers and trying to generate the reports, you need to focus on the daily activities that improve customer experience. Our team can offer the financial guidance that you need to maximize tax write-offs, evaluate profitability reports, and plan for the future success of your company.

Experienced Accounting Professionals

Are you ready for the right accounting help so that you can stay ahead of the changes in your business? If you are working to build the company and expand for future success, then you need to talk to our experienced team for more information.

Here at Easier Accounting, we understand the common financial roadblocks that many small business owners face. We are specialized in small business and entrepreneur accounting techniques, and our team will gladly help with your company. We offer the advice that you need to stay ahead of the financial details so that you can focus on customer service without worrying about cash flow or tax issues in your company.

You deserve to have a team of accounting professionals available to help with your business growth. So, we invite you to schedule a consultation to learn more about the ways our services will be beneficial for your efforts. Talk to us at Easier Accounting by calling: (888) 620-0770

Easy Steps for Small Business Automation

Starting a business is a hands-on experience. Many times, small business owners find themselves working on accounting in one moment and customer service in the next moment. When your company is in the start-up phase, then it is necessary to have all-hands-on-deck to make sure that you are starting in the right way. But, don’t overlook the importance of implementing small business automation to set up for future success.

As your business grows, it is common to feel like your schedule is getting busier and busier. But, the truth is that you should be doing LESS as the company gains momentum. Setting the right systems in place will allow you to step back from the daily grind. Instead, you can focus on the overall strategy that is implemented throughout the company.

Here are a few options that you should consider for small business automation:

Software Solutions

There is no reason that you should be manually tracking details in a spreadsheet. Instead, find the right small business automation tools to manage the information so that you can reduce the busy work and free up your time. We live in an incredible digital era that makes it easier than ever to manage business expenses and other information. Consider using some of these automation tools:

  • Cloud-Based Accounting: All of your expenses and income can be tracked through a cloud-based accounting program. For the best hands-off solution, pair the automated software with an experienced accounting team. Your accountant will oversee the transactions that are moving through the account, complete regular reconciliations, and finalize the numbers to ensure that you have accurate reports. You can access this information anytime, anywhere through the online software.
  • Invoicing and Bill Tracking: Falling behind on your invoicing means that you will have a hard time managing cash flow. Unfortunately, invoicing sometimes falls to the backburner when other matters are more pressing. Instead, look for a solution that makes it easy to automate your invoicing. Often, this feature can be incorporated into your accounting software. You can also talk to your accounting team to get recommendations that work well with the rest of your accounting system.
  • Tracking Receipts: There is no reason that you should have a shoebox full of receipts and spending documents. Instead, implement a paperless filing system so that you don’t have the clutter of so much paper in the office. Dropbox can be a great solution to consider. Sign up for paperless statements, or take a picture or scan of each receipt/invoice, then file everything in an organized folder. This information can be shared easily with your accounting team for reconciliations.
  • Password Manager: Do you have the same password for every account so that you can remember the logins? If you are still using your pet’s name for your password, then it is time to make some changes. Passwords should be long and strong with multiple letters, numbers, and characters. Use an encrypted tool such as 1Password or Roboform to keep track of the credentials. Never store your passwords on a Post-It note or in a spreadsheet that can be accessed by other people.
  • Admin Tasks: Simple tasks can be outsourced to freelancers. For example, you shouldn’t be dedicating time to write blog posts or social media updates. Hire a freelancer to handle these tasks so that you have regular online publishing without spending hours every week on the task. You can find affordable help through freelancing websites, allowing you to access people with applicable skills and many years of experience with the tasks that you need.

Daily Tasks

Other tasks need to happen around the office to keep things going. Don’t let yourself get caught up in the tedious work. Instead, assign tasks to your staff or bring in outsourced services to help. These are some of the daily tasks that you can automate so that you don’t have to worry about the details:

  • Office Cleaning: You shouldn’t have to take out the garbage on your way out the door at night. Hire a cleaning service to scrub down the bathrooms, manage the garbage, and water the plants. These baseline tasks should always be addressed so that you don’t waste brain power thinking about these things.
  • Lunch Orders: It can take a lot of time to leave the office so that you can find something for lunch. Instead of spending an hour away from your desk, consider the option to have a pre-paid meal delivery service. You can submit your order in advance, and then the meal will show up in your office at the planned time. This service allows you to take a shorter lunch break because you don’t need to spend any time in the car.
  • Landscaping: If you own the building for your company, then it is essential that you invest in a good landscaping team. These services are helpful so that you can keep up with the outdoor appearance of the building. Remember: the curb appeal of your office will set the first impression when people come to visit. So, you need to make sure that you are setting the right tone for current and potential customers.
  • Snow Removal: Businesses located in cold areas need to also think about snow removal services. Often, these services are offered through landscaping companies. Instead of showing up an hour before the office opens so that you can shovel the sidewalks, it is nice to come to work and find that the snow has already been cleared.

Customer Management

There is no doubt that your customer relationships are the most important resource to your company. Maintaining positive relationships with your customers will increase the likelihood that people will come back in the future when they are ready to purchase again. Because customers are so important, business owners often dedicate a lot of time to customer management activities.

These are a few ways that you can automate customer interactions to reduce the time that you need to spend on these tasks each week:

  • Customer Service: It is important to provide fast, quality customer service. But, that doesn’t mean that you need to spend your day responding to emails or answering the phones. These tasks can be assigned to an employee. Or, you can outsource using websites such as Help Scout or Ruby Receptionist. Basic admin tasks can be handed off to these services, freeing up your time to focus on other important tasks for business growth.
  • Managing Communication: You need to be proactive to manage communication with your current and potential customers. One of the best things that you can do is put together an autoresponder series so that regular emails are sent. These messages should be personal and engaging, helping customers see that you are interested in their satisfaction.
  • CRM: One way that you can improve the personalization in your company is by implementing a database that tracks customer information. A good system will help you keep up with details such as the person’s birthday, their shopping history, and how much they have spent with your company. Then, you can send out personalized emails on birthdays or anniversaries. Additionally, you can offer discounts or coupons that are catered to their shopping habits.

Why You Need Small Business Automation

Automating these tasks in your company can give you the time and energy to level up your business results. If you are micro-managing every small detail, then you are stunting the growth of your company. Instead, you need to put the right systems in place so that you can automate these tasks. Letting go of some of the daily busy work will free up your schedule.

What will you do with the extra time? When you aren’t loaded down with busy work, then you can spend that time on business development. Research new product ideas, look for ways to boost your current services or optimize the office to improve results for your customers.

Another option is to spend your time building relationships. Forming the right business relationships is a valuable step to open up options for the future. You can’t put a price on important relationships. But, it can be hard to form these solid relationships if you are too busy working on the minor details in your company.

Our team at Easier Accounting understands the importance of small business automation. So, we are working hard to make it as easy as possible for you to manage your accounting and bookkeeping. We offer a wide range of services that will simplify your business management and make it easier than ever to help your business grow.

Whether you need help with basic bookkeeping tasks or you are looking for tax-strategy advice, we are here to offer the assistance that you need. You are welcome to contact us anytime for more information about the services that we offer. We’ve worked hard to identify the best solutions that will maximize results for small businesses and entrepreneurs. Call our team at Easier Accounting to see how we can help with your business automation systems: (888) 620-0770

4th Quarter Financial Goals to Finish the Year Strong

4th quarter has arrived, which means that it is a great opportunity to assess your current business success. Are you on track to finish the year strong? Regardless of the financial success that you have experienced so far this year, there are a few things that you can do to wrap up 2017 and ensure that you are ready to make 2018 the best year yet. Our accounting team is looking for ways to support our clients in these efforts.

Here are a few things that you need to consider, so that 4th quarter doesn’t get side-tracked by the holiday season:

Leverage Your Busy Season

If you are in the retail business, then you are probably ramping up for a busy holiday season. It is common for retail sales to go up during this time of year because consumers are buying gifts for Christmas and other holidays that fall at the end of the year.

Not only do you need to make sure that your inventory is stocked, but you also need to be sure that you have the manpower to support the anticipated surge in sales. Failing to have the cash flow to support these efforts could result in missed opportunities for Christmas shopping.

One of the best things that you can do is talk to your accountant right now to assess your business financials. Look at your current inventory and your anticipated sales volume. Then, place orders right now so that you are ready for the busy November and December months. Don’t delay ordering the product, because you don’t want to be stuck without a product to sell when customers are looking for the products that you have to offer.

There is a reason why businesses often refer to the day after Thanksgiving as “Black Friday.” This day is often the time when the annual sales go into the black. So, the rest of the sales for the year are just gravy to fatten your profits. Using the right marketing and promotion techniques can help you leverage your results even more.

Even if you don’t sell retail products, there are ways that you can use the holiday season to boost your business efforts. For example, some service-based businesses offer Black Friday sales with discounts on the services that are available. Get creative and look for ways that you can encourage your customers to make a purchase while they are in a buying mood.

Preparing for Tax Season

When taxes are filed in the spring, our accounting team will be working with the numbers from 2017. So, right now is a great time to make financial changes if they are needed. An accounting meeting at the beginning of 4th quarter is essential to ensure that you are on-track for optimal results on your next tax filing.

For example, if you can see that the profits are coming in higher than previous years, then you might consider the option to purchase equipment needed for the office. These write-offs can help you manage your tax burden so that the results are favorable to match what you need. But, you need to know the details before the year ends, so that you can make these purchases within the calendar year.

You can’t make these decisions based on current bank account balances. Instead, it is important to review Profit and Loss reports and anticipated expenses with your accounting team. These details will help you get a clear picture of the current financial health of your company. Then, you can make adjustments or changes as needed to set your business up for financial success in the future.

Don’t Go on Auto-Pilot

4th quarter can be challenging because it is a fun time of year. Some business owners buckle down to optimize their results. But, other people take time off because of the holiday season. While it is important to spend time with your family during this busy time of year, you shouldn’t let your business goals fall to the back-burner.

Don’t rationalize the idea that you will pick up your goals when the New Year starts. If you want long-term success, then you need to be willing to buckle down to get it done throughout the year. Instead of assuming that the holiday season is a time when you should relax and take a break from the business efforts, look for ways that you can maintain continuous efforts to achieve your business goals. Find a balance between work and personal life, allowing you to enjoy the holidays without making your business suffer.

Change Your Business Perspective

Staying aware of the financial health of your company is an important strategy to help you prepare for future growth in your company. It is essential that you spend time each quarter looking at the successes and failures of the previous quarter. Identify the things that are working, and look for ways to eliminate systems that are dragging down your profit margins.

Shining light on these trends and patterns makes it possible for you to change the negative habits so that you can eliminate the bad things before the year comes to an end. You can’t do the same thing over and over again and expect different results. Instead, you need to keep your focus on the goals that you have for the future, then find ways to implement business systems that will make it possible for you to reach those goals.

In a Rut? Set New Goals for 4th Quarter

If you are a business owner who is repeating the same things over and over while expecting new results, then right now is the time that you need to make a change. Don’t let your company stay in a rut for 4th quarter goals! Instead, assess your current goals and efforts to see if any changes need to be made.

The New Year is approaching, and it will be here sooner than you know it. The work that you put in within the last few months of the year will set the tone for how your business will start in the New Year. Instead of repeating common failures, you can eliminate these bad habits to ensure that you are positioned for massive growth in 2018.

Here are a few questions that you can ask as you are evaluating your goals and success:

  • Are you on track to reach your target sales numbers for the year? If not, why?
  • What are the best activities that are bringing in more sales and revenue?
  • Where are the categories that are cutting into your profits?
  • Do you have an effective accounting system in place to show current financial reports?
  • What is working? What isn’t working?
  • Is your marketing plan bringing in the customers that you anticipated?
  • How can you leverage the holiday season to boost your sales?

Be honest with your answers so that you can see the areas where you are succeeding and failing. If you are coming up short in any area of your business, then it can be helpful to bring in an expert for advice. For example, if you are unsure about your bookkeeping and financial reports, then it is essential that you hire an expert accounting team to assist with this aspect of your business.

Set S.M.A.R.T. Financial Goals

Now that you are ready to make the 4th quarter the best quarter of the year, you are probably excited about setting goals for the last few months. While it is good to set goals, make sure that you are realistic about the goals that you are striving to achieve.

Business coaches often talk about setting S.M.A.R.T. goals. This acronym means that your goals should be:

  • Specific: Lay out the details of your goals so that you have a clear measurement to see when you reach the goal. For example, set a specific dollar amount in sales that you want to achieve before the end of the year.
  • Measurable: Generic, unmeasurable goals make it hard to see if you achieved the results that you desired. Instead of saying that your goal is to increase sales, set a goal to boost sales by 2% compared to the previous quarter.
  • Attainable: Choose a goal that is attainable within a three-month It is good to reach for the stars, but don’t shoot so high that you face failure.
  • Realistic: Also, think about realistic changes that can be made in your company. For example, it might not be realistic to design and manufacture a new product line in this short period of time. But, you could have details laid out so that you are ready for the new manufacturing by the beginning of the year.
  • Timely: A three-month goal is a great timeframe. It gives you enough time to work on the goal, without making the deadline so far out that it will get kicked down the road.

Are you assessing your 4th quarter goals? We invite you to contact our team here at Easier Accounting for help! We will review your financial details and help you see the best ways to set your company up for success in the future. Call to learn more about the accounting and bookkeeping services that we offer: (888) 620-0770

How AP/AR Processing Impacts Cashflow Management

Cashflow management is a critical part of running a business. Without cash in the bank, your company can’t function! Cash is necessary for nearly every aspect of running a company, so you need to look to the future to ensure that you have the funds that are needed for upcoming expenses.

Unfortunately, cash flow is an issue that many business owners face. Have you found yourself in a situation where you aren’t sure if there will be enough cash to cover payroll or buy new inventory? Your business can’t move forward if you don’t have employees or product to sell. So, it is important that you make a few changes so that you always have the cash flow needed to keep your company running.

Foundation of Cashflow Management: AP/AR

When are you are working to improve your business cash flow, Accounts Payable and Accounts Receivable should be the area where you direct your focus. Invoices that are coming in and going out will impact the money that moves through your bank account. Accounts Receivable encompasses the money that is owed to you by clients and customers. Accounts Payable includes the money that you owe suppliers and vendors. You also need to be aware of potential shortfalls, which are times when the incoming funds won’t cover outgoing expenses.

Accounts Receivable has an obvious impact on cash flow since it is an overall picture of the money that you will be receiving from clients and customers. Sometimes, companies get behind in their invoicing, which delays the receipt of money because the invoices are so late. If you want to be paid, then you need to be sure that the invoices are sent promptly.

Also, late invoicing can be a problem for your clients who are trying to manage their own cash flow. Whether you are dealing with business-to-business transactions or you have individuals who are buying your services, most people will need to work to be sure that the cost fits into their budget. Having an invoice in hand as soon as possible makes it easier for your customers to manage their cash flow to pay the costs that are due.

Even though it seems like Accounts Receivable is the biggest influence on your cash flow, you shouldn’t overlook how much Accounts Payable will impact your cash position as well.

Accounts Payable and Cash Flow

Once you have dialed in the invoicing system and you have the money flowing in from customers, it is also important to make sure that you are controlling the money that is moving out of your bank account. Overhead expenses and other costs are unavoidable… it takes money to earn money! It isn’t a bad thing to have invoices that need to be paid, but you need to be careful to ensure that you are tracking business spending and avoiding unnecessary costs.

The biggest problem that you can face with Accounts Payable is failing to track upcoming expenses, and then facing a situation where you need to pay a large bill and the money isn’t available. Some business owners make financial decisions based on the amount of money currently in their bank account. Then, a big bill will come through, and they no longer have the cash to pay for the expense.

For example, if you land a contract with a big client and have an infusion of money into your bank account, then it might create a false sense of security that you can spend a little more than normal. Some business owners use this type of situation to justify extra costs such as new office furniture or hiring a new employee. Spending the money as soon as it comes in might result in an issue with cash flow later.

Even though the money was available at one point, what will you do when a large, unavoidable expense comes through? Tax bills are one area where small business owners can often get caught off guard, resulting in problems because they don’t have the cash to pay the bill.

With a little bit of planning, you can look ahead to see the anticipated costs that will be coming up. Then, you can work with an experienced accounting team to ensure that you are using the best strategies with incoming and outgoing expenses to support your future financial growth.

Tips to Improve Small Business Cashflow

Whether you are currently facing cash flow problems or you are looking for a way to improve your financial future, there are a few things that you can do to improve your account management and tracking. Here are some ideas to help you get started:

  • Know Where You Will Break Even: Your breakeven point won’t necessarily impact your cash flow, but it can provide an overall picture of the financial stability of your company. Having a clear picture of the profitability of your business will help you to see whether there is enough cash left over after the expenses are paid. If your breakeven point is too high, then you might need to ramp up efforts to increase profitability.
  • Always Have Emergency Reserves: It is hard to know when an emergency will pop up. Emergencies can be in the form of equipment that needs to be replaced or damage from a natural disaster. Your cash reserves can be used to keep your company running while you are sorting through the details.
  • Make Your Cash Work for You: If you are going to save money in an emergency account, then make sure that you choose an account that will help the cash work for you. Interest-earning accounts can help you maximize your investment and generate a little more income from the money that is sitting in the bank. Talk to your bank, or look into options such as CDs or money market accounts if you don’t need immediate access to the funds.
  • Expect Shortfalls: The goal is always to have more cash than you are spending, but there are times when shortfalls might occur. Some companies face these shortfalls during the slow season, while other companies face a slowdown in sales because of economic factors. Expect that you will face shortfalls at some point and be ready with your emergency cash reserves.
  • Anticipate Upcoming Expenses: A big tax bill or a cost to replace old equipment shouldn’t be a surprise. These expenses will roll through every so often, and you can evaluate your company to know when these costs will be due. Look forward to a few months and identify potential bills that you might need to pay. Then, plan accordingly so that you have the money in your bank account for these invoices.
  • Be Proactive to Collect on Invoices: Have a proactive person on your team working on AR invoices. Keep net-30 or net-60 pay terms, and always follow up if invoices are left unpaid.
  • Offer Incentives for Timely Payments: Are you running into problems with many past-due invoices? Consider offering some type of incentive to customers who pay early. For example, you could provide a payment discount if the payment is received in 7 days.
  • Establish Clear Payment Expectations: Written payment terms need to be provided to every customer. Set clear expectations about when payments are due and the penalties for late payments. Then, make sure that you are proactive to enforce those rules always.
  • Use Cloud Based Accounting: Staying ahead of the numbers will help you see the costs that are coming up. Cloud based accounting is a great option to consider because it helps you track expenses from any location. Make sure that you have a trusted employee or accounting team who can keep these numbers current so that you always have accurate reports.
  • Double Check the Accounts with Reconciliation: When transactions aren’t properly recorded in your accounting system, it could result in bounced checks or other cash flow You need to reconcile the accounts regularly to make sure that your accounting system accurately reflects the amount of money in the bank. Monthly reconciliations are a great way to identify the missed transactions so that you can fix the problems and balance the accounts.
  • Hire an Accountant and Bookkeeper: If you can’t keep up with the paperwork, transactions, and reconciliation, then it is time to hire someone to help. It can be expensive to bring on another employee, which is why you should consider the benefit of outsourced accounting services. An accountant has the experience and knowledge to know the best way to improve your financial outlook and help you stay ahead of cash flow

Do you have a hard time keeping up with financial management in your company? Then you need to hire a team to take care of these accounting details. Here at Easier Accounting, we work with small businesses and entrepreneurs to assist with payroll, tax preparation, and cash flow. Our team knows how to help you stay ahead of the accounting requirements for business. For more information, we invite you to contact us to schedule a consultation. We are always happy to answer your questions and we can cater your accounting services to match the needs of your company: (888) 620-0770

Business Owners: Are You Taking Action or Procrastinating Important Tasks?

Are you in the process of launching a start-up, or gaining traction after being in business for several years? As a small business owner, there are many things that you have done to set yourself apart from other people. Some individuals are content to be employees because they don’t want the stress and responsibilities of owning a company. Other people, like you, love the thrill of creating something new and focusing on lifestyle design through business management.

Whether you are a seasoned veteran in the business world or you are just getting things off the ground, it is important that you are proactive to create a strong financial future for your company.

The Motivation of Getting Started

It is easy to feel the motivation when you are just getting started. The excitement makes long hours fly by, causing many small business owners to stay in the workaholic mode for a while. Many people find it easy to be an “action taker” when they are launching a new company. They are full of dreams and focusing on the possibilities.

Business owners in these beginning stages are often willing to put in the long days and carry a lot of responsibilities. They see the benefits of putting in the work now to get things off the ground. Then, systems and employees can be put in place at a later date.

If you are feeling this motivation, then it is important that you let the momentum carry you forward. Look for ways that you can solidify the foundation of your company, and make sure that you are focusing on some of the most important things that will prepare you for the future.

Finishing Your To-Do List

One of the common problems encountered by small business is owners is that they often have a to-do list that never ends. There is always something that needs to be done when you are running a business! As a business owner, it is likely that you lead in many roles throughout the day, including the manager, customer service, bookkeeper, inventory assessment, and more.

Since you are carrying so many responsibilities, it can be hard to keep up with some of the foundational tasks that need to be addressed. Look over your to-do list and see if you are successfully keeping up with everything should be completed. Most business owners will find that they are having a hard time keeping us. As a result, many of these important items are falling to the back burner.

It won’t bring the company down if you neglect the bookkeeping tasks for a week or two. But, eventually, the lack of management and responsibility can lead to serious problems for the organization. Seemingly small tasks right now add up to big results in the future. So, you need to make sure that all of the necessary items on your to-do list are completed.

Proactive vs. Reactive Managing

There are two ways that you can approach your business management system:

  • Proactive Management: Dealing with things right now so that you can avoid potential problems in the future. A proactive business owner is looking forward to seeing the possible roadblocks that might cause issues for the company. Then, measures are taken to put together the right systems to ensure the long-term success of the business. If you are managing your company in a proactive way, then you are setting yourself up for success that can’t be achieved with reactive management.
  • Reactive Management: Falling behind on important tasks can cause you to slip into reactive mode, which means that you are dealing with problems as they occur. Some business owners feel like they are jumping from one crisis to the next, making it impossible to get ahead of the chaos. If all of your hours in the day are focused on “fighting fires,” then it is a good indication that you need to make a change as soon as possible! Deal with the current issues, and find solutions to help you avoid similar problems in the future.

A business owner who is proactive with business systems often has an action-taker personality. You are willing to take risks and take massive action each day. As a result, you are probably working long hours and achieving great successes with your company.

In comparison, a person who is managing with a reactive style often has a procrastinator personality. Even though there are things that need to be done, these items are often pushed to the back-burner because their time is being used differently. Sometimes, the person might choose less-relevant tasks rather than focusing on the items that need to be addressed at the moment.

Shifting Your Focus: Create a Proactive, Action-Taking Environment

It doesn’t matter what you did (or didn’t) do in the past… what matters is the action that you are taking right now. Whether you are dissatisfied with the results that you are achieving, or you are looking for ways to boost your results, it is important that you assess your daily actions. Look for ways that you can ramp up your efforts to get the optimal long-term results that you desire.

Creating a proactive, action-taking mindset is one of the most important things that you can do for your business. By setting the right mindset for yourself, you can pass this thinking onto your managers and employees. These small changes can transform your company culture and create positive results for many years to come.

Here are a few tips to help you shift your focus to become an action-taking business owner:

  • Start the Day in the Right Way: What are the first tasks that you address each day? If you are dragging your feet in the morning and you walk into the office to face a mess of paperwork and problems, then you aren’t setting the right tone for the rest of the day. Instead, you need to be intentional about the things that you are doing to create a strong mindset. Develop a morning ritual that keeps your focus on positive thoughts and the top priorities for your business. A morning ritual is one of the most important action-taking principles that you can integrate to create lasting results.
  • Have a Clearly Defined To-Do List: Instead of only reacting to things that happen throughout the day, make sure that you have a list of activities that must be completed each day. These things need to be focused on activities that add to the bottom line of your company. If you have a hard time getting everything done, then you might consider the benefits of working with an accountability partner who can hold your feet to the fire with accountability on a daily or weekly basis.
  • Outsource Menial Tasks: If you are going to focus on the bigger management issues, then you can’t be up-to-your-eyeballs in paperwork. Make sure that you have an employee or outsourcer who can handle busy work like filing, accounting, and bookkeeping. Outsourcing these things will ensure that you are keeping up with foundational tasks, without cutting in your valuable time. You can pay someone else to handle these ongoing tasks, freeing up your time to focus on business development and future possibilities for your company.
  • Eliminate Distractions: A common cause of procrastination is that distractions are moving through your office all day long. Eliminate these distractions by setting up uninterrupted time for you to get real work done. Lock the door, turn off your phone, and let your employees know that you aren’t available during this time. Turning off social media and your email account can be essential so that you can avoid the notifications and focus on the task at hand.
  • Maintain a Positive Attitude: Even when things go wrong, you should always keep a smile on your face. Create a positive mission statement or a list of affirmations that can help you maintain the right mindset when things get hard. When you encounter a problem, you can determine if the issue is important and how it plays into your mission statement. Small things don’t need to cause stress because you need to manage your time and energy to focus on the things that really matter in the future. For example, if there is an error in an order of promotional products and you receive the wrong color pens, then it might not be worth your attention. On the other hand, big tasks such as employee management or hiring for a new position should take priority over things that don’t impact the bottom line.

With a few small changes to your daily habits, you can transform your results and create more success for your company. If you need help creating a proactive approach to the financial management of your business, then it is essential that you have a good accounting team to help. Here at Easier Accounting, we have experience working with all types of small business owners, and our team is here to help. We invite you to contact us to learn more about the ways our accounting services can be beneficial for your company: (888) 620-0770

Summer Accounting Tips for Small Business Owners

Summer is here, and many people are looking forward to a few months of fun with their kids. As a small business owner, it is easy to let some of the business management tasks slide because you are distracted with activities outside of work.

Even though it is common for some industries to experience a decrease in business during the summer months, it doesn’t mean that you can get lazy with your bookkeeping or other activities. On the other hand, some small businesses cater to summer activities, which means that things get busy during this time of year. Either way, you need to consider the unique needs of your company and the things that you can do to ensure long-term success.

Here are a few things that you can consider to help you have a successful summer:

Planning Summer Vacations

It can be a trick if you are understaffed because all of your employees take a vacation at the same time. Consider putting together a summer schedule in advance to work around the anticipated vacation schedules of your employees.

This schedule will allow your staff to be on the same page so that you can have all of the tasks and activities covered throughout the summer months. If someone is going to be out of town, then you can plan ahead by cross-training other employees to handle the details during the break.

Having a time-off policy and request format will simplify your ability to plan a schedule that will keep the business running. Also, you can plan ahead if you are leaving for vacation so that the staff is prepared to handle the day-to-day management in your absence.

Seasonal Staffing

For businesses that have an increase in sales during the summer months, it might make sense to hire seasonal employees. An increase in business for a few months doesn’t often merit hiring a bunch of full-time employees. Instead, consider working with a temporary hiring agency or looking for options to bring on freelance contractors for a time.

Just make sure that you are working with your accountant to coordinate payments. A contractor will be paid in a different way than a full-time employee. Taxes and withholdings are handled uniquely, and your accounting team can ensure that you are doing the right thing.

An accountant can also help you distinguish between the tasks of an employee and contractor. Some business owners want to hire contractors so that they can avoid paying benefits and other overhead costs. But, if the workflow and requirements match the legal guidelines for an employee, then you need to make sure that you are complying with the right payment methods. An experienced accountant can help you compare the options so that you can bring in the best talent and maximize your spending at the same time.

Online Accounting Management

If you are planning to take some time off with your family, consider the benefits of implementing an online accounting system before you leave. These programs make it easy for you to stay up-to-date with the numbers so that you can see what is going on while you are away. Don’t get stuck in the old paper filing methods now that we live in a digital world!

Implementing an online system is one of the best things that you can do to streamline your business finances. It is easy to run reports and get a feel for the profitability of the year. Your accountant can make recommendations about the software program that match the needs of your company.

Another thing to consider is the benefit of hiring an accounting team if you don’t already have these services in place. Hiring an accounting means that you can take off with the family for a fun vacation, without worrying about the financial details back in the office.

Summer Promotions

Are things slowing down during the summer months, but you want to keep the income flowing? Then right now might be a great time to run a promotion or new marketing campaign. Just because things often slow down during this time of year, doesn’t mean that your business needs to take a hit. The right marketing campaign can bring more people through the door, helping to boost the bottom line.

Look for ways that you can add some summer fun to your promotions. For example, you might have a BBQ in the parking lot or pass out popsicles on the day of a big sale. These things might seem small, but they can offer a great way to generate goodwill with current and potential customers.

Maintaining Productivity during the Summer Months

One of the biggest concerns that small businesses have during this time of year is the decline in productivity among employees. When people are away from the office and the workload goes down, it is tempting to spend more time around the water cooler. As a result, your business will suffer even if you are fully staffed.

Consider steps that can be implemented to boost employee morale and encourage productivity. The summer season could be a good time of year to implement a fun competition or contest that offers extra rewards for performance.

Also, look for ways that you can help employees recharge during their breaks so that they are refreshed and ready to get back to work. A comfortable break room or outdoor area can be a nice way to provide a positive work environment.

Catching Up on Bookkeeping

Do you get caught in the trap of ignoring your bookkeeping until it is time to file tax paperwork? Too often, small business owners get stressed because they are trying to crunch the numbers during a busy time of the year.

If you have extra time available during the summer months, then it can be a great opportunity to get caught up on the busy work that has been neglected. Sort through the paperwork, finish up data entry, and talk to your accountant to see if there is anything else that needs to be addressed. When things are slower, it is the perfect time to implement a new program if you want to make changes.

Keep Up with Payments and Paperwork

Just because you are taking time off for vacation, doesn’t mean that you can neglect important tax payments and paperwork. For example, June 15th is coming up, which means that many people need to drop a check in the mail for their 2nd estimated tax payment in 2017. Missing this deadline could result in late fees and interest costs, increasing the amount that you need to pay in the future. Your accountant can help you determine if you are required to make these estimated payments throughout the year.

It is also essential to stay up-to-date with payroll and withholdings. You might be away from the office, but your employees will still need to be paid! Hiring a payroll service will give you the ability to go out of town without leaving your staff without a paycheck. These services offer a great way to stay ahead of ongoing withholdings and payments that need to be made throughout the year.

Track Expenses

Whenever you have an expense that can be used as a deduction on your taxes, make sure that you are keeping the receipts and documentation. Uncommon expenses might pop up during the summer, such as a company BBQ or other perks that you offer to employees or customers. These costs can be considered in your tax preparation, but you can’t claim the deductions if you don’t have documentation for the transactions.

So, it can be a good idea to gather the receipts and file them for the future. A good filing system will ensure that you can find the documentation if it is needed for any reason.

Hiring a Professional Accounting Team

There is no doubt that an experienced accountant can help you maximize your profits and improve future results for your company. Small business owners often follow a do-it-yourself approach to these tasks. So, stress levels can go up if you are trying to manage everything on your own. There is no reason that you need to carry the burden without the support of an experienced team, and right now might be the perfect opportunity to explore your options.

Bringing in an accountant can help you analyze your profit and loss reports so that you can look for ways to boost your cash flow. At the same time, consider the areas where you can cut unneeded expenses that are running up your overhead costs.

Are you interested in learning more about how professional accounting services can be beneficial for your company this summer? Then right now is a great time to talk to our team here at Easier Accounting. We specialize in small business accounting services, and we are here to help! Contact us to see how we can assist with your business finances. We are happy to cater the information to match the needs of your company. Call to schedule a consultation: (888) 620-0770

Factors to Consider if You Need a Small Business Loan

Are you preparing to launch a start-up? Or do you need some extra money to help with the cash flow of your existing company? There are many reasons why business owners and entrepreneurs might be thinking about applying for a business loan. Before you run to the bank to open a line of credit, it is important that you talk to your accounting team to learn more about financial strategies that can be used in this situation.

Cash Flow for Business Operations

It is important to be sure that you have the cash flow to maintain daily operations for the company, which often means that you need to front the cash to pay for inventory and other expenses. But, you need to be careful to ensure that you have enough money to carry the company until the receivables come in.

If you know the numbers, then the risk is minimal to front this money. So, you should maintain close communication with your accountant to ensure that you can pay off the loan when the extra cash is available.

But, mistakes can be made and cause your company to be strapped in debt. These debt payments could make it harder to keep up with cash flow, eventually leading to the demise of the business.

Making Debt Useful to Grow Your Business

There is nothing wrong with using debt to grow your company. You just need to be sure that you are working with experienced financial professionals to ensure the long-term success of your strategy. Once these funds are secured, then you can use the money to boost inventory or focus on business development. Eventually, the risk could pay off with a big return on your investment.

There is no doubt that it takes money to earn money. Some business owners have a reserve of cash that can be used to get the company off the ground. Other times, it might be necessary to find angel investors or to get the financing that is needed from a lender.

How to Get a Small Business Loan

Don’t expect to walk into a bank and have easy access to money for a business loan. You need to do your homework and make sure that you are prepared when you meet with the lender. This meeting is essential to help you secure the funding that is needed. But, it can be a challenge for some people to get the approvals that are necessary for a loan or line of credit.

Securing a business loan is even harder if you haven’t been in business for many years or you don’t have the assets to use as collateral. The lender wants to see that there is a fallback option if you default on the loan. They are looking at the risk of lending the money to you.

Here are a few things that you can do to win over the lender and secure the loan that you need:

  • Provide the Lender What They Want: The lender will provide the money, with the caveat that it will be paid back in full with interest. The biggest worry is that you will be unable to pay back the loan. So, the lender will assess your personal financial history, to see if you have a good credit score and track record. Additionally, they will request information about the business plan and the anticipated outcomes as you work through the anticipated challenges of owning a small business. You need to be prepared with details and documents that will show why you can succeed when other businesses in the same industry have failed.
  • Provide the Paperwork: Don’t show up to your meeting empty-handed. Most lenders will be looking for specific documents, and they might even provide a list of requested information in advance. For example, you should bring business tax returns, profit and loss reports, proof of sales, your business plan, bank statements, or anything else that will help to show the financial picture of your company.
  • Choose the Right Lender: Instead of walking into a random bank down the street, do your homework to find a lender with a good reputation. If possible, it is best to find a financial institution that often works with small businesses and entrepreneurs. What types of loans does the lender typically offer? Do they have a good reputation among their customers? Choosing the right company can increase the likelihood that you can secure the money that you need.
  • Build Business Credit: If you are applying for a personal loan, then the lender will run your credit score to determine the risk of lending to you. In the same way, banks want to know more about your business credit score. They will look at assets and credit history to see if you have built a strong financial reputation for the company. Without this credit history, it can be hard to get approval for the loan. The best way that you can build your business credit is by securing smaller lines of credit through suppliers or investors. Then, you can strengthen your credit rating and buy assets that can be used to back up the loan money.

If you have questions about the process of getting a business loan, it can be helpful to talk to your small business accountant for advice and information. You accountant can help you prepare the documentation that is needed. Sometimes, they can even provide recommendations about good lenders to work with.

Choosing a Bank for a Small Business Loan

As mentioned above, choosing the right lender is a critical step to help you secure the loan that you need. By selecting a reputable lender, you can rest assured to know that you won’t get burned by the loan. Find someone who can offer fair interest rates and reasonable payback terms.

The most important factor is to make sure that you choose a bank that is friendly to small businesses. Here are a few options that you might consider:

  • Local Banks: Applying for a loan with a large corporate bank means that you might get lost in the shuffle. Instead, look for small financial companies that often work with local businesses. There is a Small Business Lending Fund that can be used by community banks to fund loans for small companies.
  • Talk to Other Small Businesses: Do you know any other small business owners in the area? Often, start-ups and entrepreneurs are well-connected with other people in the same situation. Ask your network to find out where they secured financing, and they will likely provide referrals for you to use.
  • Small Business Administration Secured Loans: Consider the option to apply for loans that are secured by the Small Business Administration (SBA) in the United States. These lenders will be listed as either preferred or certified by the SBA. The loan doesn’t come directly from the SBA. Instead, the lenders can secure financing through the SBA to provide loans for small businesses.

Comparing Your Options

Keep in mind that you don’t have to limit yourself to one financial company. Instead, it can be beneficial to apply for several loans so that you can compare your options. There are many lenders willing to provide the money that you need, and it can be to your benefit to compare the offerings so that you can find the best terms for your needs.

Be selective about the loans that you choose because you need to be sure that the financing will support the long-term results for your business. If the repayment terms are too difficult to meet, then you might consider looking for other options that are available.

Using the Money Wisely

Once the loan has been approved and you have secured the money that you need, work with your accountant to make sure that the money is used in the right way. Too often, business owners spend the loan money too quickly on things that won’t necessarily contribute to the future growth of the company. Then, they are stuck with the same revenue and higher bills that need to be paid each month.

Your accountant and other financial professionals can help you assess the anticipated Return on Investment for the money that you will be spending. Be selective to dedicate the money to business activities that will help to boost your revenue, providing the cash flow that you need to pay back the loan.

Are you looking for financial advice catered to the needs of your company? Then you need to talk to our team here at Easier Accounting. We specialize in small business accounting, and our goal is to provide the financial strategies that will help your business grow. We can cater your accounting services to match the needs of your company.

We are always happy to answer your questions and help with anything that you need. Call us to learn more about the ways that we can help your small business. We will gladly schedule an appointment to discuss the services that we offer: (888) 620-0770

How Will Accounting Services Help Your Business?

A business idea is just the first step in a long journey that will lead your company to success in the future. There are many people who come up with great ideas, but find their business fails because they don’t implement the right systems to help the company to succeed. Are you looking outside the box to find the solutions that will benefit your organization?

New Call-to-action

One of the biggest reasons that companies fail is because they don’t implement the right accounting system. A spreadsheet or notebook with listed expenses might be a manageable solution when you are working out of your garage. But, moving to a place that allows your business to grow will expand the financial requirements of the company. You need to be sure that you are setting the foundation for future growth by implementing an accounting system that will track your current results and look at possibilities in the future.

Manage Your Business Financial Information in a Proactive Way

It would be nice if you could organize the company, point everyone in a specific direction, and then step back to let things happen. But, without proactive management, it is possible that small potholes could turn into major roadblocks in the future. A business is a living entity that needs to be managed, which is why you need to put checks and balances in place to ensure future success.

Daily systems need to include tracking of incoming receivables and outgoing expenses. If you aren’t keeping up with this information, it is likely that you will run into issues with cash flow problems. Even if the money is coming in the future, you need to have the cash available to pay the bills right now.

It is a mistake to manage the financial details of your company reactively. For example, some business owners don’t track all of the expenses; then they make their financial decisions based on the current balance in the bank account. As a result, the account might be overdrawn because they didn’t account for upcoming tax payments or payroll.

So, you need to tap into the experience of a knowledgeable accountant who can keep up with the daily transactions. Additionally, these accounting services can be essential to help you prepare for future expenses and investments for product development.

Top Business Goal: Make a Profit

It is obvious that the top goal of your company is to make a profit, but many businesses come up short in these efforts. Even if you are bringing in a lot of money, there won’t be anything leftover if your expenses are high. So, you need to analyze the money that you are spending and compare it with the money that is coming in to see how much will be leftover when the dust settles.

Quality bookkeeping and accounting services are essential to help you manage the reports and look at financial projections for the future. Your accountant can help you stay ahead of the payments that will be due so that you can avoid cash flow issues and other common problems that pop up along the way.

Another benefit of accounting services is to identify the unnecessary expenses that might be chipping away at your bottom line. If you are spending money on things that aren’t contributing to creating a profitable company, then your accountant can help you see the things that need to be cut. Too often, business owners are too busy to look at this information, or they don’t know what they are looking for when they pull up the accounting numbers.

Cutting Costs and Increasing Receivables

To boost profits, there are two things that your accountant will suggest for your company. First, you need to decrease the money that is spent. As mentioned above, your accountant can help you trim down on the monthly expenses to increase the profit margins that are available. You need to make sure that you are receiving more money than what is being spent!

Additionally, you need to look for ways that you can increase the amount of money that is coming into the company. Focus on the tasks that bring in the most income, so that you can increase those tasks to optimize your team’s efforts.

Accounting is a great way for you to make educated decisions that will impact both the current and future financial results for your company. For example, if you can see that you aren’t bringing in enough money to cover expenses, you might be able to make small adjustments to change the price of your products or services so that you can reach a desired level of profitability. It can take some work to keep up with these numbers, but your accountant can assist so that you can focus on other responsibilities related to owning and managing a company.

Basic Accounting Services that are Essential for Your Business

When you learn the value of accounting services, it is a no-brainer solution to hire someone to assist. The next question on your mind might be related to the person that you hire: how do you choose the best accounting service for your company?

You need to make sure that the accountant is knowledgeable in all of the financial services that your business will need:

  • Capturing costs and tracking expenses
  • Organizing costs into categories such as inventory, labor, overhead, and more
  • Running reports to show the financial health of the company
  • Tracking money that is coming in from the products and services that are offered
  • Analyzing cost behavior to predict future results
  • Adjusting price points for services or products
  • Budgeting to manage cash flow
  • Maximizing tax deductions
  • Handling tax filing and paperwork on a monthly, quarterly, and annual basis

These things are some of the basic accounting services that are required by most companies. You might need all of these services, as well as a few unique services applicable to your requirements. It is essential that you talk to an experienced accounting team to get the recommendations based on the nuances of your industry.

Free Up Your Time for Business Growth

If you are spending your time on financial activities, it is likely that you are missing out on future growth opportunities in your company. Business owners have many responsibilities that they need to handle. Stretching yourself thin by taking on too many responsibilities can cause overall business performance and results to decline.

You shouldn’t be spending your time on busy work to complete tasks such as payroll processing or data entry for new invoices. Instead, you need to be focusing on the management of your employees and development of new products that can be offered to your customers. Spend your valuable time on the activities that will help your company grow, and outsource these important accounting tasks to an experienced contractor.

Invest in Accounting Services to Build Your Company

Some business owners attempt a do-it-yourself approach with their accounting systems because they don’t want to spend money on the cost of accounting services. Instead of looking at this service as an expense, you need to see it as an investment.

Not only will your accountant help with the organization of your financial records, but an experienced accountant can also increase the likelihood that your business will reach higher levels of success in the future. Proper financial tracking can improve your ability to make the right decisions because you will be informed about the financial health of your business at any given moment. At the same time, an accountant can help you save money on taxes and other expenses that might be eating away at your profit margins.

Hiring an Experienced Accounting Team

Whether you need to implement an accounting system for the first time or you can see that it is time to upgrade your current system, Easier Accounting is here to help. We specialize in accounting services for small businesses and entrepreneurs, and our goal is to create a system that is built to handle the future success of your company.

We know the problems that might arise in your business, and we have the experience that is needed to avoid these problems proactively. By taking a proactive approach with your accounting system, you can streamline your business processes and eliminate stressful “reactive” financial management in your business operations.

There are many online accounting solutions that can be used as a cheaper alternative to hiring a local accountant. Here at Easier Accounting, we want to help you see why our company stands out from the competition. We are looking for the best solutions to offer high-caliber results at affordable prices. We invite you to talk to our team and compare the options, and you will see that we are leading the industry.

For more information about how your company will benefit from small business accounting services, we invite you to contact us today. We would be glad to schedule a consultation with you to discuss our services and the results you can expect. Contact Easier Accounting at (888) 620-0770