Keeping a watchful eye on money is crucial to every organization but especially startups and small businesses. By learning proper cash management techniques early, you will reap the rewards of your hard work later.
The concepts behind successful business cash management are similar to what consumers hear from experts. Budgeting and planning are always important, along with setting money aside to prepare for unexpected emergencies.
There's a lot you can do to save your business money while still making sure employees are well compensated and satisfied. Here are four suggestions.
1. Use technology tools to help. Businesses use updated technology, from Salesforce to cloud-based email, for almost every facet of operations, yet when it comes to managing finances many are still operating on Microsoft Word and Excel.
While these productivity tools can help you in many ways, there are much more advanced tools that can streamline your accounting procedures, handling everything from billing to tracking. These tools usually have built-in analytics that can show you where you’re headed each month.
Related: How to Better Manage Your Cash Flow
“Cloud technologies enable companies to focus on growth while making their investments work more efficiently, especially in categories like travel and expense, the second-largest area of controllable spend,” says Elena Donio, EVP at Concur, a firm that helps companies around the world with expense management solutions.
2. Create partnerships with your employees. Employees are a business’s biggest asset. When employees are satisfied and productive, a business thrives. By supplying workers with the best tools available to complete their daily tasks, your business will equip itself to take on any challenges that arise along the way.
Workers who feel supported are motivated to grow your company, becoming your business’s biggest advocates. As your most vital asset, you should place your team members as a top priority in your budget.
When your employees see they’ll be rewarded for good performance, they’ll work harder to make your company a success. If your company has a good year financially, your employees should have a good year financially, as well, especially if they’ve put in long hours to make it happen.
On the other hand, employees with poor participation who create work for extra other team members should be disciplined and, if necessary, removed. This shows you, as a boss, stand behind your team and will help them as much as possible.
3. You can’t manage what you can’t measure. Today’s growing businesses have access to top-quality analytics that can give them insight into every aspect of financial and business activities. By leveraging the power of data, a professional can learn where money is being wasted in order to find where money can be saved each month.
“Data can help you track commonalities with your spending,” continued Donio. “For example, awareness about what you spend will enable companies to more efficiently manage cash flow and realize that there’s a better way to manage it.”
4. Learn from peers and experts. Each community contains a wealth of small and medium-sized businesses working alongside each other to reach customers and manage daily operations. Many of these businesses have found that by seeking the advice of others, they can share tips and advice that will benefit them as they grow.
Local networking groups are a great way to meet with other business owners on a face-to-face basis, which has many advantages. You can locate some of the many startup networking groups through peers, online searches, or sites like meetup.com.
There are also a wealth of resources online to help you network virtually. Sites like LinkedIn can help you locate peers and connections within your industry and the Small Business Administration and SCORE provide tips from professionals directly on their websites.
In-person conferences and online webinars are also a great way to access financial advice on a variety of topics, while also making connections that can come in handy down the road. Small businesses face many challenges as they work hard to grow a customer base. By finding a way to support team members using today’s technology and your own great management skills, your business will be able to continue to grow.