Risk Management: Essential Tips for Small Businesses

Risk is an unavoidable part of owning a business. But just because you are investing in something that could be a profit or a loss, doesn’t mean that you should be exposed in areas where the risk can be minimized. When it comes to risk management for a small business, a few specific steps can be followed to help you diminish the loss potential.

Risk Management Needs Change with Time

Keep in mind that risk management changes with time. The steps that were effective when you started your business many years ago might no longer be sufficient for what is required in our modern day. The business world is changing each year, and technology means that your business is exposed if you aren’t proactive about your risk management practices.

Even if you have a few risk management initiatives in place, it is smart to check with industry experts to evaluate systems and look for potential improvements. For example, work with a tech team to ensure that your website is secure and protected against hackers and malware. You can also hire an outsourced accounting team to evaluate the financial systems that are in place, helping you to avoid possible theft or fraud by employees.

Managing Risk is the Foundation of a Successful Business

The long-term sustainability of your company depends on what you are doing right now to minimize risk and maximize profits at the same time. If you are sloppy with your risk management, then mistakes will cut into your profit margins and eliminate the extra cash that could have been used for reinvestment.

You can’t avoid every possible risk that might affect your business. But you can be smart in your industry and pay attention to some of the most critical factors that have proven to be problems for other business owners.

7 Tips for Small Business Risk Management

Here are a few important things that should be considered as you are designing a risk management program for your company:

  1. How Much are You Willing to Risk? It doesn’t matter if you are investing in a new product or trying a different marketing campaign; you need to know how much money you can afford to risk. Current, accurate reports through your accounting system provide you with detailed information regarding cash flow, liabilities, and extra money that can be used for the investment. Work with your outsourced accounting team to understand the details of the report so you can use this information while making decisions about the amount of money you can spend. Always avoid a new investment or venture that requires so much cash that you will be unable to stay in business if something goes wrong.
  2. Investment in Insurance Coverage: A good insurance policy can go a long way to ensure that you are protected if something goes wrong. Talk to an insurance expert to identify the coverage that might be a good fit for your business needs. It’s smart to have insurance coverage on your real estate holdings or rental properties, which will cover the costs if your building and inventory are damaged in an emergency. At the same time, you need Worker’s Compensation insurance to cover possible injuries on the job, as well as liability coverage if something happens when a customer is in your store. Some industries, such as medical professionals, can invest in malpractice insurance if needed.
  3. Create a Risk Culture: Not only do you need to train your management and upper-level staff on risks within the company, but all team members must understand how various risks might affect the success of the business. Ongoing training regarding beliefs, attitudes, and policies ensure that everyone is on the same page in the way the decisions are made on a daily basis. This risk culture starts with the top management, then works its way down through all team members.
  4. Identify Potential Risks: Specific risks vary depending on the industry, as well as the products and services that are offered. Any circumstance or event that could have a negative impact on the business can be considered a risk. For some businesses, there is a risk of theft if employees or visitors steal inventory or equipment. On the other hand, a digital company might be at risk due to website hacking and data theft. In the construction industry, employee injury can be a risk that could cripple a business financially if something goes wrong on the job site. Since risks vary from business to business, it’s up to you to identify the specific risks that could be impacting your company right now (or in the future).
  5. Manage Identified Risks: When possible, put various systems in place so you can manage the risks that have been identified. Potential management strategies might include monthly reconciliation and regular account checks to avoid financial theft. Or, you can invest in a great security team if needed. This proactive approach will help by minimizing the problems associated with certain problems that could affect the profitability and reputation of your company.
  6. Prepare Contingency Plans: You don’t want to expect the worst, but you need to be sure you are prepared if something happens that affects your business. This contingency planning means that you know how to handle the situation if your business can’t operate because the building is damaged, or a key person is unable to work for a time. Also, you should have contingencies in place for large contracts and big transactions.
  7. Ongoing Risk Review: Just because you are implementing good risk management strategies right now, doesn’t mean that you are set for the future. Mark your calendar to review your risk plan at various points throughout the year, ensuring that you are staying ahead of new risks that might pop up.

Common Business Risks

What are the risks that could affect your bottom line? These are some of the most common business risks that can occur:

  • Safety
  • Security
  • Property loss
  • Technology
  • Customer management
  • Business interruption
  • Delivery services
  • Financial systems
  • Employee injury
  • Compliance with regulations and laws
  • Reputation
  • Key person loss

If you expose your business to the wrong risks, it could be the downfall of the company if the risk is too high. While you need to take risks to start a company and grow the business, you should always be strategic about the risks you are willing to take.

Finding the Balance Between Profitability and Peace of Mind

As a business owner, you can’t hide and hope that nothing bad happens to your company. If you want to be profitable, then you need to take various risks. At the same time, you need to evaluate the weight of these risks and make the right decisions that will give you peace of mind in the future.

If business risk isn’t anticipated and addressed, then you could be facing serious repercussions in the future. When something goes wrong, it could result in a setback for your company, or worse… business failure. The key is to find the right balance between the risks you are willing to bear and the services that are offered to your customers.

Your goal is to provide customers with excellent services and products, while maximizing the money that comes in and containing the money that goes out. This process helps to boost profits. But your profits can be lost in a moment if something happens unexpectedly and you aren’t prepared.

Work with a Financial Expert to Minimize Risk

When it comes to risk management, it all comes down to the numbers. You need to know how much risk your business can bear without experiencing too much loss or damage. Too often, small business owners procrastinate this work because they aren’t willing to dedicate the time and effort that is needed to get a clear picture regarding the financial health and stability of the company.

If you have been leaving your financial reporting and strategy on the backburner, then it might be time to hire an experienced accounting team for assistance. These services can be used to evaluate your business success, potential losses, and create a plan for the future. Support from a trusted, experienced accountant is invaluable and can have a positive impact on the long-term trajectory of your business.

Call Us at Easier Accounting

Why should you choose the services offered by our team at Easier Accounting? We understand the unique challenges faced by business owners, and we offer years of experience working with entrepreneurs and small businesses. Our goal is to help you create financial systems that minimize the risk of fraud and theft, while also providing the reporting necessary so you can make accurate, clear decisions for your company.

Whether you are getting ready to start a business, or it’s time to overhaul your current financial system, Easier Accounting is here to assist. We offer full-service accounting solutions to support the unique needs of your company. Call us any time to learn about the way our services can be used to reduce potential risk in your business efforts: (888) 620-0770.

Small Business Tips: How to Manage Your Money

The ultimate goal of running a business is to not only offer quality products and services, but also maximize profits at the same time. Even if you understand your ideal customer and have a great marketing strategy in place, your business will fail if you don’t know how to manage your money. Money management will make or break your company, which is why you need to be intentional about the way you are structuring your finances.

Freedom Through Money Management

Too often, people feel like money management is another to-do item that needs to be added to a never-ending list of responsibilities. How can you keep up with the books when you are worried about business development, employee reviews, customer service, and more?

The truth is that a good money management system actually frees up your time, allowing you to focus on other tasks within the company. When you are using the right software, paired with an experienced outsourced accounting team, you don’t have to focus your effort on busy work and tax calculations.

Learning how to manage your money gives you the freedom to run your business in the best way possible. You always have a clear picture of your accounts, including both income and liabilities. This information optimizes the business decisions you make each day, which has a domino effect on improving your long-term results.

Money Management Doesn’t Have to be Overwhelming

If you don’t know much about finances or money management, then you likely feel overwhelmed at the idea of implementing a new system. This process doesn’t need to be complicated. Instead of trying to reinvent the wheel, you should lean on the advice offered by an experienced accounting team.

Your accountant can do the heavy-lifting to design and implement a new financial system for money management. Then, you simply need to learn the right way to use this system to support your financial goals.

Be Proactive in the Way You Manage Your Money

The key is to take a proactive approach in the way you choose to manage your money. Instead of always stressing over immediate bills and trying to “put out fires” in your bank account, you need to be thinking ahead and anticipating the upcoming costs.

For example, sometimes business owners make the mistake of spending money that is available in the bank account, when that cash should have been set aside for an upcoming tax bill. Even though the money is in the account right now, it doesn’t mean that it can be used for extra expenses or a new project. It is important that you consider your cash flow and have a specific system in place, so the money is saved and ready to go when the payments come up in the future.

Being proactive means that you aren’t making decisions based on a quick, limited snapshot of your current bank account. Instead, you are evaluating financial trends, looking at the way the cash usually flows through your account, and preparing for unexpected things that might come up in the future.

How to Improve Your Money Management Strategies

Here are a few simple steps you can follow to improve the systems you are using to manage your money. While these tips are geared for business money management, don’t overlook the benefits you can enjoy by also applying these tips in your personal finances as well.

  • Debt Evaluation: It is difficult to keep a business going without good debt, but the debt burden can become too heavy and eventually take down the company. How much debt are you carrying right now? What are your debt ratios? If the credit cards and lines of credit are creeping up, then it means that you are spending more than you are bringing in. Look for ways that you can cut costs, so you have more cash to pay down the credit lines as quickly as possible. Not only are these accounts demanding cash flow each month, but the balances are going up due to interest costs and fees.
  • Cut Unnecessary Costs: Take a real, honest look at how you are spending your money to find ways that you can reduce unnecessary line items. Don’t underestimate the power of trimming your expenses. Even the smallest monthly costs can add up over time, resulting in hundreds or thousands of dollars spent over the course of a year. Sometimes you can reduce unnecessary costs, such as switching service providers or eliminating monthly subscriptions that aren’t being used. Go through your expenses line-by-line and consider the value each expense is bringing to your company. Then cut anything that isn’t contributing to your business goals so that you can reduce your spending.
  • Create a Rainy-Day Fund: It is normal for all businesses to have busy and slow seasons. When sales are up and the cash is flowing, it is the perfect time to ensure that you are ready for the rainy days that are sure to come in the future. Creating an emergency fund means that you will be prepared if something goes wrong with a product shipment or you are facing repair work on your building. Having a 6-month emergency fund will give you peace of mind to know that you are prepared for whatever might happen in the future.
  • Separate Business and Personal Expenses: It’s easy to let the personal spending get mixed in with business expenses. Unfortunately, things get complicated if you don’t have a clear line drawn with your accounts. Make sure you have separate accounts and credit cards. Be deliberate in the way expenses are paid so that your bank statements are accurate in reflecting the money spent on the business. If you have disorganized records, then it means that you could be missing tax deductions and potential business growth opportunities in the future.
  • Purchases and Inventory Timing: When big expenses are coming up, such as inventory restocking, consider the way you can time the purchases to ensure there is enough money in the bank. For example, if you can avoid restocking inventory in the same month that a tax payment is due, then it helps to balance out your cash flow for the month. Don’t tie your cash up in too much inventory that just sits on the shelf and collects dust throughout the year.
  • Set Financial Goals: These goals need to be realistic and achievable. How much do you think you can bring in this year? What are your anticipated costs? Design a budget based on these financial goals. Remember to be conservative in your estimates so you have room for mistakes and issues that might pop up. Not only do you need to work through the numbers, but you also need to be sure that you have action steps to follow that will support future growth.
  • Don’t Miss Payments: Even when cash flow is tight, it is important to make sure that you are keeping up with all payments. Your budget and emergency fund will help by ensuring that you have money available when the bills are due. Be strategic and determined never to miss a payment! It might seem like a small thing to be late on a payment, but you need to consider the consequences that can occur if you aren’t diligent about payments that are owed. For example, missing vendor payments means that they might not be willing to work with you in the future, which could potentially hurt your ability to provide the products your customers desire. Additionally, on-time payments help you avoid costs due to late fees and interest expenses.
  • Ongoing Financial Strategy: After reviewing your current financial situation, the next step is to ensure that you have a plan in place so you are prepared for the future. This ongoing financial strategy should include details such as the use of a good accounting software, services from an experienced accountant, and daily/weekly/monthly tasks, so you don’t fall behind on your financial tracking and reporting. The easiest way to ensure that you are consistent you’re your financial strategy is by enlisting the services of an outsourced accounting team that offers full services throughout the year.

It’s never too early to get started on your new financial strategy. If you are struggling with money management, then the first step is to talk to an accounting team for assistance. Don’t be embarrassed about the current state of your business finances. Instead, be willing to ask for help so that you can improve your results and ensure that you are prepared for the future.

Talk to the Small Business Accounting Pros

Easier Accounting is leading the industry with personalized tax services for small business owners. We understand the challenges you are facing with cash flow, profit margins, and other financial aspects of running a company. You don’t need to carry the responsibility without support from an experienced, knowledgeable team. For more information about the quality outsourced accounting services that are offered, you are welcome to call us at any time: (888) 620-0770.

Choosing Business Accounting Services: Firm vs. Freelance Bookkeeper

One of the best stress-reducing decisions you can make for yourself is hiring an expert to help with business accounting services. You are already carrying enough stress as you are working through the details of employee management, marketing plans, and product development. Add the details of bookkeeping and accounting on top of your daily responsibilities, and it can be a lot to keep up with on an ongoing basis.

It’s understandable that the decision to outsource business accounting services can be a challenge. Not only do you need to hand over the keys to someone you don’t know, but some business owners aren’t sure if it is worth taking on another monthly cost. The truth is that you will receive countless benefits when you finally make the decision to work with an experienced financial pro. This one decision might be the turning point to help your business grow to higher levels of success.

Why Do You Need Business Accounting Services?

If you are getting your company off the ground, then it might seem like an unnecessary expense to hire a financial professional. Is it worth the cost when cash flow is tight? Yes! As you learn more about the benefits of working with an accountant and/or bookkeeper, you’ll see that this expense should be at the top of your priority list.

Many entrepreneurs thrive on DIY, especially when they are just getting started. While there are certain things that you can do for yourself, there are also appropriate times to bring in an expert who can assist with your needs. It can be a challenge to find the time required to keep up with ongoing bookkeeping and accounting responsibilities.

Plus, there is a good chance that you are making avoidable mistakes if you don’t have experience in the financial industry. You wouldn’t try to fill a cavity without visiting a dentist, so why would you try to analyze financial reports if you don’t have an accounting background? Failing to engage the services of a trusted accounting team means that you will be missing out on critical insights that are needed to help your business grow.

In fact, when business owners finally make the decision to hire someone to help with accounting and bookkeeping, these business owners often find that they weren’t doing nearly as well as they expected. Just because you are staying consistent with your DIY system, doesn’t mean you are covering all of the essential aspects required for your financial reporting.

It is common for a financial professional to uncover problems with transactional errors, poorly structured systems for paying bills, and even gross errors in the financial reports. If you want to make quality decisions for your business, then you need to lean on the services offered by an accounting professional.

Considerations: Bookkeeper vs. Accountant

The most important thing that should be considered as you are making this decision is regarding the type of services that are required for your company. Are you looking for someone to help with only tax strategy? Or, do you prefer a full-service approach that includes ongoing support with account reconciliation, financial report analysis, and more?

Even though the term “bookkeeper” and “accountant” are sometimes used as synonyms, there are distinct differences in the services that you will receive from these providers. You should never assume that a bookkeeper can provide all of the services available from a business accounting firm. As a result, you might be missing out on a few key services that are required to support your business needs.

A bookkeeper and accountant share common goals, and their roles often overlap. Here are a few details to help you distinguish the different types of services available:

  • Bookkeeping Services: A bookkeeper is responsible for overseeing the ongoing financial transactions, such as invoice payments, payroll, sales tracking, and more. These transactions need to be recorded, categorized, and reconciled to ensure that details aren’t overlooked in the bigger financial picture. Bookkeepers help with accurate recordkeeping, but the services don’t typically include analysis of financial reports.
  • Accounting Services: When a bookkeeper ensures the business is maintaining accurate record keeping, then the accountant can step in and build on the information that has been recorded by the bookkeeper. Accountants often help with financial statement reviews. The data is taken to the next level with detailed analysis, interpretation, and advice. The goal is to use reportable data in a way that helps with cash flow and business strategy.

So, do you need a bookkeeper or an accountant? In most cases, small business owners can benefit from both services. The benefit of choosing a bookkeeper is that the services are often less expensive, but you will be missing out on the financial analysis available from an experienced accountant. In fact, it often makes sense to spend the extra money on accounting services, because you will be able to recover those costs by reducing your tax load and maximizing your business strategy. Many business owners find the best solution is to choose a team that offers both bookkeeping and accounting services, such as the all-inclusive packages offered here at Easier Accounting.

Comparing Your Options: Firm vs. Freelancer

There’s no question that every business owner needs to tap into financial support. Most people begin with a startup idea, but they have no experience or knowledge regarding the business side of things. Just because you have a product that people are interested in buying, doesn’t mean you have the smarts to handle the books that support your business.

It is important that you understand a few distinctions between the services offered by an accounting firm vs. a freelance accountant:

  • Cost: If you are looking for the lowest price, you will often find the best value for your money by hiring a virtual team. Local accountants need to carry the expensive overhead costs of maintaining a building and other expenses. In comparison, an online team can keep prices low since these costs can be avoided.
  • Timeline: When you are working with a team, such as the services offered here at Easier Accounting, you don’t have to stress about deadlines being missed. Certain deadlines need to be met, such as payroll processing, account reconciliation, and tax payments. A single accountant will go out of town at times, which means that your deadlines might be overlooked since only one person is overseeing your financial needs. In comparison, a financial team ensures you will never miss a deadline, regardless of the personal schedules of the individuals on a team.
  • Experience: There’s no question that you are tapping into a broader range of experience when you choose to work with an accounting team. A local accountant will have knowledge about small businesses in your area, but that experience will be limited since the person is tied to a geographic location. In comparison, an online team has experience working with a full range of companies in many different locations. This spectrum of hands-on experience means they have more to bring to the table regarding the financial services needed for your company.
  • Access: One of the benefits of our digital age is the access to cloud-based software programs. Instead of the need to visit with your accountant in person, you now have the option to work with a team located anywhere in the world. Even if you are on the other side of the country, our team can offer high-quality services through digital access to your financial books. Your business can go paperless, and approved managers and financial pros can access your financial information at any time.

When to Hire Business Accounting Services

The truth is that it is never too early to bring in the experience of an accounting professional. Even if you are just getting started with your new business or you are in the early stages of growth, it is essential you have the support of a financial team that will help you get things off the ground. Business owners who make the decision to hire an accountant early in the game rarely regret their choice.

These services help to build a solid foundation that makes it easy to help your business grow in the future. When you have a solid financial system, then you can avoid common growing pains that occur when other business owners aren’t prepared.

A financial professional can help as you create a plan based on the needs of your company. This system will help you save time, which means that you will also be saving money in the process. You can hand the responsibility to an experienced business accounting service, allowing you to turn your focus to other responsibilities that are required to help your business grow.

If you are considering the option to hire business accounting services, then our team is here to assist. Easier Accounting knows what it takes to ensure financial clarity for your small business. We invite you to reach out to us any time to learn about the services that are provided by our team. We’re here to help with both bookkeeping and accounting services needed for your small business: (888) 620-0770.

How to Leverage Financial Mistakes to Build Your Small Business

It doesn’t matter if your startup efforts are home-based in the basement or if you’ve been in business for years, money management can be a concern for all business owners. Dealing with cash flow, expenses, and billing can be a challenge. In some cases, certain financial mistakes can be enough to force a company to close its doors.

Maybe you’ve identified financial mistakes that have affected your company. Or, there is a possibility that mistakes have slipped by undetected. Either way, it is essential that you have a good accounting system to help you stay on track. Just because financial missteps happen, doesn’t mean that it will be the closing chapter for your business efforts. Instead, these mistakes can often be used to identify weak points in your system, helping you strengthen your business strategy for the future.

Transparency is Key for Success

The most important thing that you need to do is to maintain transparency with your reporting and accounting practices. If a mistake happens, it might be tempting to “brush it under the rug” because you are embarrassed that you didn’t get it right. But we are all human, which means that mistakes happen. Instead of spending your time focusing on the problem, look at the overall picture and identify areas of improvement.

Transparency is the best thing you can do to keep your company moving forward. When you are consistent with financial tracking and reporting, then you can always get a good feel for the current positioning of your company. These details can be used to influence your business decisions, helping to propel your company forward in the future.

So, every business owner needs to look at the foundation of wise financial tracking: do you have a good accounting software and system to maintain transparency with every transaction that moves through your accounts? Creating this system is essential so you can leverage your mistakes for your advantage.

Turning Financial Mistakes into Advantages

How do you put this principle into action? It can be difficult to see where you can make changes after a mistake so that the situation is a positive support for your company. Here are a few examples to help you create the mindset of learning from your mistakes:

  • Cash Flow Complications: When the overhead costs and bills come due, you need to be sure that there is enough money in the bank to cover these expenses. The truth is that most business owners experience challenges with operating capital. Regardless of the size of your business, cash flow is something that needs to be addressed and prioritized. All it takes is one big client who is late with a payment to result in a situation where you need to get creative to come up with cash for payroll or an upcoming tax bill. If you encounter cash flow issues, then it means you aren’t being careful enough in your project estimates. Rework your business plan so that you are more conservative with the monthly estimates. Also, make sure you always have at least 3 months of operating expenses in an emergency savings account.
  • Lack of Diversification: Do you have all your eggs in one basket? Without client diversification, you could be facing issues if the industry shifts. Don’t allow your cash flow to be dependent on a single client. This mistake could leave you in a pinch, but it is also a good motivation to change your processes to ensure it doesn’t happen again in the future. Going forward, be deliberate about reaching out to new, potential clients before the other contracts end. You need to be sure that you have enough in the pipeline to stay busy, even when things change with your current workload.
  • Skipping Project Milestones: When you have a lot of cash tied into one client or customer, you might make the mistake of waiting for a lump sum payment at the end of the project. Unfortunately, payment delays and schedule slippage could result in late payments, which will have a domino effect on other aspects of your business. Learn from your mistake: Instead of aiming for one big payment at the end of the project, set up projects with milestones and incremental invoicing to ensure that the cash flow is still coming through.
  • Business Growth Happens Too Quickly: It doesn’t sound like a bad thing to have your business growing so quickly that you can’t keep up. But, if important details are overlooked, then it could show your company in poor light in the industry. There is a fine balance to ensure that you are keeping up with the growth without leveraging yourself too quickly. For example, not only do you need to ensure you have the inventory to keep up with an increase in product demand, but you also need to be careful to avoid leveraging up the overhead expenses if your cash flow can’t handle it yet. Always be conservative in your forecasts and be careful to manage expansion according to the timeline that your business can carry.
  • Not Following Through on Outstanding Invoices: Consistency with follow-through is essential when it is time to collect payments from your customers. If you aren’t diligent with touching base about the outstanding payments, then it’s likely you won’t receive timely payments. Avoid these financial mistakes by committing to a good accounting system going forward. Organization, consistency, and the right software program can help you identify the outstanding payments so you can be sure that nothing slips through the cracks.
  • Competing on Price: If sales are slow, then it might be tempting to lower your prices so you can bring in more customers. Unfortunately, many business owners find that it’s a race to the bottom if you are only competing on price. Slashing the price of your products or services is only a temporary fix to bring in immediate cash flow. But this decision harms your profit margins, which means you will have less cash to work with for business growth in the future. If you’ve made this mistake, then it is time to redefine your marketing and branding strategy. It is essential you differentiate in the industry based on value for the customers. People will be willing to pay more money if they can see the benefits that will be gained from your product or service.
  • Data Entry Inaccuracies: There is always the risk of mistakes happening on the project. Whether an employee entered a few inaccuracies on the transactions in the accounting software, or someone overlooked a transaction altogether, it can have an impact on the accuracy of your reports. When inaccuracies happen, it means you are making decisions using wrong information. As a result, it could harm your cash flow, potentially resulting in late fees and legal ramifications if payments are missed. This problem can be solved by creating a system of checks and balances. In the future, you can rest assured knowing that nothing is overlooked when you are consistent with monthly reconciliations.

How to Handle the Situation When Mistakes Happen

What is your automatic response when a mistake is discovered in your business? Some people get upset; while other people want to ignore the problem. Before another mistake happens in the future, it is smart to evaluate how you will handle the situation going forward.

Failing fast is key when mistakes happen. Don’t let yourself get so caught up in the moment that you have a hard time moving forward. If money was lost, then view the situation as “tuition” for the education that you learned. Allow yourself to learn from the mistake so you can implement changes that will move your company forward in the right direction. A few small changes can be put into operation, making it possible to avoid running into the same mistake again in the future.

Tapping into Professional Services

The most common reason why financial mistakes happen is that business owners fail to utilize professional services that are available. Even though it might seem smart to save a little cash with a DIY approach, you could be facing a loss of thousands of dollars in the future with a big mistake. It’s worth the expense to bring in an industry professional so you can avoid some of the most common errors in the industry.

One great example is in the accounting industry. As a small business owner, you might try a do-it-yourself approach for tax preparation and filing. But you need to consider the hours and hours that will be required so you can figure out the tax forms and understand the best way to leverage your deductions. Plus, it is likely you could be missing out on thousands of dollars in tax write-offs because you didn’t understand the law. If a mistake is made, then you could be facing fines and fees from the IRS.

Instead, spending a little money for ongoing accounting services can be invaluable to help you avoid the common mistakes made by small business owners. If you are looking for financial support for your company, then Easier Accounting. Is here to assist. Call us at (888) 620-0770.

Goal Setting Strategies for Small Businesses

If you are an entrepreneur or business owner, then it means that you are probably a goal-oriented person. People who are willing to step out of the typical career paths are looking to create a different lifestyle and new opportunities. It can be both exciting and scary to step into new territory and try something different. The upside potential is incredible if you set the right goals. Consider these goal setting strategies if you are looking for ways to improve your business results.

Manageable Growth for Future Success

While everyone wants to be an overnight success, uncontrolled growth could be the factor that brings your company down. You need to be sure that you have the inventory, customer support, and business resources available to manage all of the orders that come in. So, it is important that you aim for manageable growth to ensure that you can sustain it in the future.

For example, instead of setting a goal to double your clients, consider setting incremental goals that can be achieved over a period of time. You might start by aiming to increase your client list by 10% at a time. These incremental steps can move you in the right direction over time, until you reach the ultimate goal in the future.

Don’t sink your company by moving too fast. Instead, be realistic about the services that can be provided for your customers, and aim to move that incrementally so that you can achieve the results that are desired.

Lean on the Experience and Recommendations of Others

It is easy to be narrow-focused on the problems at hand. But, don’t make the mistake of overlooking resources that might be available to help with your business growth. Tapping into outside knowledge and resources can help you avoid some of the roadblocks that come up along the way. You can skip the problems that were encountered by your mentors, putting you on the fast track to achieving higher levels of success.

There are a few key areas of your business where you might consider services and support from others. For example, it can be helpful to bring in an accounting team to assist with the finance strategy. These services will allow you to focus on the daily responsibilities so that you don’t have to spend your time crunching numbers every day. Talk to your accounting team about the goals that should be in place, helping you identify goals that are realistic and manageable.

S.M.A.R.T. Goals for Your Business

One common acronym used in reference to goal setting is SMART: Specific, Measurable, Achievable, Relevant, and Timely. Using this strategy can help you stay focused on the things that matter. Here are the things that you should be considering when you are setting goals:

  • Specific: Setting a general goal can make it hard to identify when the goal has been achieved. Instead of setting a goal to “boost company profits” include detailed numbers that you would like to hit. For example, you might set a goal to increase monthly sales by 10% by the end of the year. When you are specific about your goal, there is a greater chance that it will be achieved compared to a general goal. Answer six important questions to get specific: Who, What, When, Where, Which, Why?
  • Measurable: It is important that you have detailed criteria in place to measure your progress. How do you know if you are going to hit your goal if you can’t track the progress that you are making along the way? A few easy questions can help you identify the measurement of your goal, such as: How many, How much, or how do I know when the goal has been met?
  • Achievable: Find the goals that are most important to your success, but make sure that there are ways to make those goals become a reality. You can achieve almost anything that you set your mind to. But, it can be helpful to focus on incremental goals if the bigger goals seem too far away. Setting goals beyond your reach could be setting you up for failure. Dream big, but also do a reality check to make sure that you can eventually reach the level you are striving to achieve.
  • Relevant: Make sure that your goal aligns with your company mission. Not only do you need to consider your current progress, but you should also evaluate the current business climate and conditions you are facing. Set goals that will have an impact on the way the company will grow, while being in touch with the realities of the market that you are experiencing.
  • Timely: Finally, you need to have a deadline that you are aiming for. These goals won’t be accomplished if you don’t tie a timeframe to the process of setting the goal. For best results, it is a good idea to keep the timeframe within a few months, giving you time to see progress. When that goal is achieved, then you can set the next goal to help you make the incremental steps that are needed in the future.

It is incredible to see the possibilities that are available when you are deliberate with the way you are setting goals. Instead of randomly choosing goals for your company, take the time that is needed to identify the steps that will work in your favor in the future.

Trusting Your Knowledge and Experience

While it is important to be deliberate in the way you are setting your goals based on data and achievable results in the future, there is also a time when you should trust your instinct in the way you are growing your company. You’ve already come a long way to take the steps needed to build a business. Recognize the progress that has been made and look for ways that you can trust yourself and the possibilities that are available for the future.

For example, you might have a feel for the way the business flows throughout the year. During slow season, it might make sense to work on system improvements, such as improving the accounting and bookkeeping system or working on business development. On the other hand, it could be good to set sales goals when you are in the busy seasons of the year.

Examples of Business Goals

Do you need help identifying goals that might be helpful for your business success? Here are a few options that you might consider:

  • More Revenue: Increasing revenue is often the first goal that business owners think about when they are looking to improve their results. You can set revenue goals, or look at other numbers that affect revenue, such as sales, prices, and more. Talk to your accounting team to identify the areas of potential for boosting your revenue.
  • Reduce Costs: While you are increasing your income, it is also helpful to decrease expenses at the same time. If you don’t control your costs, then you will have a hard time maintaining profitability. Review your expenses and find ways that you can cut the recurring expenses to improve profit margins.
  • Manage Debt Load: When you are carrying large amounts of debt, then it means that your cash flow is likely being taken up in monthly payments and interest costs. Set goals to reduce your debt or pay it off completely. These goals will have a lasting impact on your business success since your cash will be freed up for other investments and business development options.
  • Improve Cash Flow: It can be stressful if you are checking the bank account throughout the month to make sure that you have enough money to pay the bills that are coming through. If you are always coming up short with the money that is needed to pay your bills, then it means that you should set goals to improve your cash flow. Create a goal to have an emergency reserve of cash so that you don’t come up short every month.

These are just a few examples of goals that can be used to improve your business success. But, the best goals are those that will have the greatest impact on your results. It is important that you evaluate your company. Look at the historical trends and possibilities for the future. Then, find the areas where you can change your habits and results to create better opportunities to help your company grow.

Talk to an Experienced Accounting Team

Do you have questions about goal setting strategies or other methods that can be used to improve your business finances? Right now is a great time to talk to an industry expert to learn more about the way accounting services can support your goals. If you are interested in learning more, then we invite you to call our experienced team at Easier Accounting. We offer services for small businesses and entrepreneurs. This focus gives us the experience and applied knowledge that ensures optimal results for your company. Call today to learn more about the services that are available We’re here to help: (888) 620-0770