Good business financial decisions are the difference between success and failure. We all prefer the former, which is why at times, we need help to improve our business financial management to ensure a happy business owner and a functioning, growing and profitable business.

Except for the accountants among you, very few of you will have been trained in financial management, nor will it be the area of your business you are most passionate about either! 

However, financial management matters a great deal, not just from a profit and loss perspective, but also in how you grow, scale and achieve the type of business you want to be the owner of.

In this blog we are offering some tips and approaches to helping you manage your business’ finances.

Planning

A key starting point with our clients is to formulate a clear business plan. We go into details about your business and its financial activities, what money you need and where the money comes from.

We will focus on forming a strategy with you by identifying what needs to happen financially for your business to achieve its short and long term goals and ultimately aim for a good profit!

Strategic financial planning develops a successful and profitable business. The only way to get a handle on what success looks like and to be able to keep track of everything is to have a good plan.

Organising

Use a good record keeping system to keep your accounting records up-to-date. 

Organisation is the key and a good accounting system will not only do the work for you, it will help you to stay focussed on running your business knowing that your systems are organised and efficient. 

Having your financial statements in order also keeps the accountant (and the tax man) happy. Accurate records ensure you meet the deadlines and avoid unnecessary fines. 

Therefore preventing loss of any valuable profit! 

You would be amazed (or maybe not!) at the number of business owners who don’t give financial management and their records the time it deserves and requires. 

Controlling

If your business is operating efficiently, it will save money which will improve and boost your business finances.

Controlling overheads such as heating, lighting, equipment and air conditioning, is one of the best ways to cut costs, and indeed save energy. An added bonus by saving energy is that you will also improve your green credentials, as well as your profit!

Another drain on resources can be poor stock control. Keep track of your stock, monitor and put efficient systems in place.

One of the key areas to look at when it comes to controlling costs is reviewing your supply chain. With costs ever increasing, proactively reviewing your supply chain to ensure you are paying the best and appropriate price for your materials, equipment etc matters. 

Be in control, to stay in control.

Monitoring

How much money do you have in the bank? 

Do your customers pay you on time? 

Do you know what your day to day costs are? 

How is your cash flow? 

If you don’t know the answer to these questions, you need help monitoring your business finances! After all, if your finances aren’t in order, your business will struggle to run smoothly and you may be left out of pocket.

Read our previous blog where we discussed cash flow.

The answer to these questions will determine how, where and when you can invest in your business. So if you want to progress your business, you need to understand the current financial position of your business at any given time. 

Monitoring is not just something which happens once a year, as stipulated by HMRC, it;s something that needs to happen to run a profitable business.

Advising

Financial problems are common in business and it is vital to tackle issues as and when they occur. But it is even better to be able to see when they are going to occur. 

As a good accountant friend once explained, if you go to the bank saying in three months time your business’ cash flow will be tight but six weeks later it will be resolved, it leads to a very different conversation than the one you would be having than if the bank suddenly flagging to you that you’ve got a cashflow problem at that very moment!

Identify any threats quickly and seek advice from professionals. 

Focus on getting help to mitigate any problems that will affect your business finances.

As a business coaches, we will advise you on strategies to avoid where possible, and tackle problems if they arise.

There is such a critical link between a business owners personal happiness and the lack of financial worries, that strong financial management, using an approach as the Planning, Organising, Controlling, Monitoring and Advising model really matters. 

Need more further advice to help improve your business finances?

Through my career as a business coach, I have helped transform many businesses struggling into financially viable businesses that turn a good profit and become a valuable asset. 

A successful financially managed business equals a very happy business owner.

If you’d like to learn more about how to best manage your finances, why not book an initial consultation with me?

Follow the link here to my Calendly to book a 90-minute chat where we can discover your business goals and the best way to achieve them!