Spring Cleaning Your Finances: Refresh Your Business for Success

As the snow melts and flowers bloom, Spring is the perfect time to give your business a fresh start. Just like tidying up your home, Spring cleaning your finances can help you streamline operations, reduce stress, and set your business up for a successful year ahead. Here are some practical tips to help you refresh and organize your business finances:

1. Review and Organize Financial Documents

Gather all your financial documents, including invoices, receipts, and bank statements. Organize them digitally using cloud storage services like Google Drive or Dropbox. This will make it easier to access and manage your financial records throughout the year.

2. Update Your Budget

Take a close look at your current budget and adjust it based on any changes in your business. Consider new expenses, revenue projections, and any financial goals you want to achieve. A well-planned budget will help you make informed decisions and stay on track.

3. Streamline Your Accounts

Consolidate accounts where possible to reduce complexity and fees. Ensure that all accounts are up-to-date and accurately reflect your business's financial situation. This includes checking for any outstanding payments or debts.

4. Implement Efficient Payment Systems

Upgrade your payment systems to make it easier for customers to pay you. Consider using online invoicing tools like QuickBooks or Xero, which can automate reminders and help you track payments more effectively.

5. Monitor Cash Flow

Keep a close eye on your cash flow to ensure you have enough liquidity to meet your business needs. Use cash flow forecasting tools to predict any potential shortfalls and plan accordingly.

6. Seek Professional Advice

If you're unsure about any aspect of your financial management, consider consulting with a financial advisor. They can provide personalized advice tailored to your business's specific needs. Check out the Garrett Planning Network to find a fee-only financial planner.

By following these simple steps, you can give your business finances a thorough Spring cleaning. This will not only help you stay organized but also position your business for growth and success in the coming year. So, take a deep breath, grab a cup of coffee, and get ready to refresh your financial landscape!

Keep IT Sunny~

March Forward: Tips for Financial Clarity, Boosted Productivity, and Goal Achievement

Hello Visionary Entrepreneurs!

As we dive into March 2025, it's hard to believe how quickly the year is unfolding. This month brings two significant events: the onset of Daylight Saving Time and the arrival of Spring. While opinions about DST vary, let's focus on what we can control—our businesses and productivity.

This Month's Focus:

1. Spring Cleaning Your Finances: As Spring begins, it's the perfect time to refresh and organize your business finances. We'll explore practical tips to help you streamline your financial management and set your business up for success.

2. Overcoming Productivity Slumps: We've all experienced those moments when motivation seems elusive. This month, we'll discuss strategies to boost productivity and help you break through any slumps that might be holding you back.

3. Revisiting Your Q1 Goals: With the first quarter coming to a close, it's time to reflect on your progress and adjust your goals for the next quarter. We'll share insights on how to set SMART goals and stay on track to achieve them.

Stay tuned for actionable advice and personal insights to help you grow your business and thrive in the new season! Don’t forget to change those clocks.

Keep IT Sunny~

Creating a Growth-Oriented Budget for Your Service-Based Business

In the dynamic landscape of service industries, crafting a growth-oriented budget is crucial for propelling your company forward. A well-designed budget not only helps manage expenses but also strategically allocates resources to fuel expansion and innovation. Here's how you can create a budget that drives growth for your service-based business in 2025 and beyond.

Define Clear Growth Goals

Start by outlining specific, measurable objectives for your service business. This could involve expanding your client base, launching new service offerings, or increasing market share. For instance, if you're aiming to grow your customer base by 30%, your budget should reflect increased allocation towards sales team expansion and targeted marketing campaigns.

Understand Your Expenses

Categorize your expenses into fixed (e.g., rent, insurance, salaries) and variable (e.g., outsourcing fees, material costs) to allow for more flexible and strategic allocation of resources. This distinction is particularly important for service businesses, where costs can fluctuate based on project demands.

Allocate Funds for Growth Opportunities

Earmark funds specifically for expansion initiatives in your service business:

• Hiring new talent to scale operations

• Investing in technology to boost productivity and service delivery

• Launching marketing campaigns to expand your customer base

Consider setting aside a percentage of monthly revenue for these growth initiatives.

Choose the Right Budgeting Approach

Several budgeting methods can support your service business's growth goals:

1. Percentage of Revenue: Allocate budget based on projected service revenue.

2. Zero-Based Budgeting: Rebuild your budget from scratch each period.

3. Goal-Oriented Budgeting: Structure your budget around specific service milestones.

4. Flexible Budgeting: Build in adaptability to accommodate market changes or rapid growth.

Standardize and Delegate

To grow efficiently, standardize your service offerings and work processes. Create quality standards for all your work and implement a digital leadership system. This allows you to delegate work more effectively, potentially to freelancers or less expensive staff, while maintaining service quality.

Leverage Technology and Automation

Invest in business automation tools and AI to streamline workflows, improve service delivery, and reduce overhead costs. This can help you scale your service business without proportionally increasing expenses.

Focus on On-Demand Service Delivery

Implement an on-demand service fulfillment model to optimize resource utilization. Hire only when you have work, and consider using freelancers to meet fluctuating demand. This approach helps maintain profitability while scaling your service business.

Monitor Key Performance Indicators (KPIs)

Regularly track and analyze KPIs relevant to your service business, such as client retention rates, project profitability, and team utilization rates. Use these insights to make data-driven decisions and adjust your budget allocation as needed.

Creating a growth-oriented budget for your service-based business requires a strategic approach that aligns financial planning with your specific industry objectives. By setting clear goals, understanding your expenses, allocating funds for growth, choosing the right budgeting method, and maintaining flexibility, you can create a financial roadmap that not only manages costs but actively drives your service business forward. Remember, in the service industry, your budget should reflect a balance between investing in your team's capabilities and delivering exceptional value to your clients.

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Mastering the Money Flow: Savvy Strategies for Cash Flow Success in 2025

Effective cash flow management is crucial for long-term business success, especially when dealing with seasonal fluctuations. To navigate these challenges and maintain healthy reserves, businesses must first understand their unique seasonal patterns by analyzing historical data and industry trends. This knowledge forms the basis for accurate forecasting and budgeting, allowing companies to anticipate cash shortages and surpluses.

For service-based businesses, effective cash flow management is crucial to navigate seasonal fluctuations and maintain financial stability. These businesses often face unique challenges, such as project-based income and varying client demands throughout the year. Here are 10 strategies for cash flow success:

• Optimize Cash Flow - To optimize cash flow, service-based companies should start by analyzing their historical data to identify seasonal patterns in client demand and revenue. This insight allows for more accurate forecasting and budgeting, enabling businesses to anticipate lean periods and plan accordingly. Building a cash reserve of 3-6 months' operating expenses is essential to weather slow seasons and seize growth opportunities.

• Diversify your services - Diversifying service offerings can help smooth out seasonal variations. For instance, a landscaping company might offer snow removal services in winter, or a tax preparation firm could provide year-round bookkeeping. Implementing retainer agreements or subscription-based services can also provide more consistent income streams.

• Optimize billing - Optimizing billing practices is crucial for service businesses. Consider requiring deposits for large projects, offering early payment discounts, or implementing milestone-based billing to improve cash flow. Leveraging technology for invoicing, time tracking, and payment processing can streamline operations and accelerate cash inflows.

• Invest time wisely - During slower periods, focus on cost management by adjusting staffing levels, negotiating with suppliers, and reviewing overhead expenses. Additionally, use downtime for staff training, business development, or improving internal processes to enhance efficiency and prepare for busier seasons.

By implementing these strategies and maintaining a proactive approach to cash flow management, service-based businesses can effectively navigate seasonal fluctuations, build financial resilience, and position themselves for long-term success.

Keep It Sunny~

Happy New Year, Visionary Entrepreneurs!

I can’t believe we are finally in the New Year. As we embark on 2025, it's time for solopreneurs and microbusiness owners like yourselves to set the stage for a year of growth and success. This month, we'll focus on three essential financial strategies to help you thrive in the coming year.

 First, we'll dive into effective cash flow management, exploring techniques to smooth out seasonal fluctuations and maintain healthy reserves. Next, I’ll guide you through creating a growth-oriented budget that balances reinvestment with profitability, ensuring your business is primed for expansion. Finally, we'll discuss smart tax preparation, offering organizational tips and a simple to-do list to help you prepare for tax season and work more efficiently with your tax professional. 

Focusing on these three key areas will equip you to make 2025 your most financially successful year yet. Stay tuned as I provide practical insights and tools to elevate your business to new heights!

Keep It Sunny~

The Financial Health Check: Why Every Business Needs to Assess Its Finances

I went to a doctor's appointment yesterday to follow up on my annual visit. I learned that there are a few things that I need to fine-tune to ensure that I stay in tip-top shape. As I walked away I thought it was a good idea that I have insurance and use it to go get annual checkups so that I can be informed about what’s happening in my body.

So many times it seems people just drop dead out of the blue sky but it might be that they were not aware of things happening inside of their bodies because they didn’t feel sick. In the same way as business owners, we need to stay vigilant about the financial health of our business. Things might look okay from the outside but unless you are actively engaged with your finances you won’t know for sure. 

The Importance of Assessing Your Business Financial Health

Regularly assessing your business's financial health is vital for ensuring long-term success. Here are the key benefits of conducting a financial health assessment:

1. Enhanced Decision-Making

A clear understanding of your financial situation enables better decision-making. By analyzing financial statements and key performance indicators, you can:

• Identify trends and potential issues early

• Allocate resources effectively

• Make informed choices about investments and cost management

2. Improved Cash Flow Management

Effective cash flow management is essential for business sustainability. A financial assessment helps you:

• Analyze accounts receivable and payable cycles

• Forecast future cash needs

• Develop strategies to improve liquidity

3. Better Risk Management

Understanding your financial position allows you to identify and mitigate risks. Through assessments, you can:

• Evaluate debt levels and overall financial stability

• Identify dependencies on specific customers or suppliers

• Create contingency plans for potential downturns

4. Increased Credibility with Stakeholders

A solid grasp of your financial health enhances credibility with stakeholders, including:

• Investors, who seek confidence in your operations

• Lenders, who prefer businesses with transparent finances

• Suppliers and customers, who may evaluate your stability before engaging

5. Operational Efficiency

Financial assessments can uncover areas for operational improvements. By analyzing data, you can:

• Identify unnecessary expenditures

• Optimize pricing and inventory management

• Streamline processes to enhance profitability

6. Strategic Planning and Goal Setting

Regular assessments facilitate effective strategic planning by enabling you to:

• Set realistic financial goals

• Align objectives with your overall business vision

• Track progress and adjust strategies as needed

7. Early Problem Detection

Monitoring key financial indicators acts as an early warning system, allowing you to:

• Detect declining profitability or inefficiencies

• Address challenges before they escalate

Assessing your business's financial health is crucial for informed decision-making, effective risk management, and sustainable growth. Make it a regular practice to ensure your business remains competitive and resilient in a dynamic market. Print out this list and review it often.

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Achieving Financial Clarity: A Bright Future for Your Business

I am a music lover of all genres. One of my favorite songs written by Johnny Nash and made famous by Jimmy Cliff is called, “I can see clearly now.” The song states:

“I can see clearly now the rain is gone

I can see all obstacles in my way

Gone are the dark clouds that had me blind

It's gonna be a bright (bright)

Bright (bright) sunshiny day

It's gonna be a bright (bright)

Bright (bright) sunshiny day

I love the description of how darkness turns into light and happy times are ahead. The sheer optimism of it makes me smile. 

As an entrepreneur, there's nothing quite like the feeling of clarity and optimism when you can see your business's path forward. It's like the sun breaking through after a storm, illuminating all the possibilities ahead.

But what truly brings a smile to my face? 

Clean, well-organized financials.

There's something deeply satisfying about pristine Balance Sheets and Profit & Loss Statements that tell a clear story about your business. Whether that story is positive or challenging, having accurate financial information empowers you to make informed decisions and take decisive action.

So, how can you achieve this level of financial clarity in your own business? Here are five key steps to consider:

1. Separate Personal and Business Finances: Keep your personal and business accounts strictly separate to maintain clear boundaries and accurate records.

2. Develop a Strategic Financial Plan: Integrate your financial goals into your overall business strategy to ensure alignment and focus.

3. Build Your Financial Team: Invest in professional help. Assemble a team including a bookkeeper, tax professional, banker, and financial planner to manage your finances effectively.

4. Regular Financial Check-ins: Set aside time to review your numbers consistently. Stay informed about your business's financial health to make timely adjustments.

5. Plan for Contingencies: Conduct regular cash flow analysis to understand your financial patterns and prepare for unexpected events.

By following these steps, you'll be well on your way to achieving financial clarity in your business. With a clear financial picture, you can confidently navigate challenges and seize opportunities, leading your business toward a bright and successful future. Remember, financial clarity isn't just about numbers – it's about gaining the insights you need to make your entrepreneurial vision a reality.

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How Can You Manage Cash Flow Effectively?

We are in the homestretch of the year. It's calm before the seasonal storm but it does seem like it costs more to buy groceries and other essentials. You might wonder where all your money goes on a personal level. The same can be said for your business finances.

It seems that daily there is a new increase in my business expenses due to vendors increasing their prices.

Are you experiencing the same thing?

Wouldn’t you like to keep more of your money and understand where exactly your cash is going?

In today’s fast-paced business environment, effective cash flow management is essential for the survival of your business. Let’s dive into how you can manage your cash flow effectively and explore the important role that organized bookkeeping plays in ensuring that you have the data needed to analyze your cash flow situation. 

First, we must define what is cash flow.

Cash flow is simply the movement of money in and out of your business. It’s not just about your profits but it’s the timing around when your money is flowing throughout your business. You might be profitable on paper BUT if you are struggling to pay your bills promptly then you could be headed for disaster. The question is how can you manage cash flow effectively? Here are 3 tips:

• Build a cash reserve that will give you a buffer between your business and the challenges that arise.

• Manage your payables effectively and ensure that you speed up getting receivables paid by customers.

• Create a cash flow projection for your business that shows the anticipated future income and expenses that will show up in your business so you can anticipate shortfalls. 

Having organized books can help you get there in 3 ways:

• 
  Having organized books can help you to make quick decision making because you will have accurate financial information at your fingertips.

• Having organized books will help you to identify trends in your business that will show patterns in your cash flow cycle that will allow you to plan for fluctuations and opportunities.

• Having organized books will help you to look attractive to lenders if you ever need a loan because they will appreciate reviewing your accurate financial statements. 

The year is almost over and we are heading into a season where money can fly right out of your pocket and you would be none the wiser. This can be paralyzing for a business and understanding how your cash flows throughout your business is essential. Bookkeeping that is organized is key to successfully managing your cash flow. I hope these tips will help you to understand and optimize the cash flow in your business.

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Help! My Finances Are A Mess!!!

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Are your business finances a mess? 

Do you know how much profit you are making or how much you are spending on expenses? 

Believe it or not, it can all be connected to how you feel about money. According to an article on Forbes.com, “A money mindset is a manifestation of your attitudes and beliefs about money. A positive money mindset can help compellingly guide your behaviors, while a negative money mindset can produce equally adverse effects.”

It is important to recognize what baggage you might be carrying from your past about money and shift your thinking. Here are a few tips:

1. Reprogram your thinking by consuming material about a positive money mindset. I like T.Herv Eker’s book Secrets of the Millionaire Mind. He also has a YouTube channel that is a great resource to use. 

2. Get clear about what you are trying to achieve. Create goals that lay out your financial priorities for this year, next year, and 5 years from now.

3. Get your finances organized. If you are not ready for bookkeeping services then I recommend you use Youtube University to learn about different methods to organize your business finances. A simple spreadsheet is fine to start with. 

Your mindset is key to determining whether or not you will achieve financial success or bottom out. I hope this short post encourages you to gain clarity, and confidence and take action around leveling up your mind around finances so you can be successful.

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Are You Making Money?

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When I am helping clients who are new business owners the end goal of financial reporting can be just to file their taxes. What may happen as their business grows is the need for a capital loan to make an investment in their business and then all of a sudden they will need more information at the request of the bank or another third party. I like to empower my clients to understand what is going on inside of their business whether they need funding or are ready to hire a new team member. One of the most important things to know as a business owner is that you are making money. The Profit & Loss can give you that information. 

The Profit & Loss answers the questions:

• What did I sell?

• What did I spend?

• What is left after that?

What Did I Sell?

If you take a look at your Profit & Loss you will see that it is organized to show your sales categories at the top portion of the report. Each category is like a sales bucket symbolizing how you generate revenue for your business. It enables you to compare your sales buckets to see what sold well this month vs. last month or another period. In this way, you can make adjustments to categories that aren’t doing so well and dig deeper into those categories that are selling like hotcakes! The result is your total income amount. 

What Did I Spend?

This section is broken into Cost of Goods Sold/Cost of Services vs. Expenses. Cost of Goods Sold/Cost of Services which are the direct inputs needed to generate revenue. If you offer services and not a physical product then you would look at things like subcontracted labor or a direct third-party vendor you use to deliver a particular service for one of your sales categories. The total Cost of Goods Sold is subtracted from total income to arrive at your gross profit. 

The second part of the “What Did I Sell” section deals with operational expenses. You are going to see things like advertising, bank fees, office supplies, insurance, etc. These are the outputs that are needed to run your business regularly. The key number to look at here is the total expenses amount. The result of this section is that it can help you to see what expense categories are providing a real benefit to your business vs. those you might want to change to get a greater benefit or save money.

Just remember that it usually costs money to make money and that your viewpoint about business expenses should include looking at what is an investment into your business vs. a commodity that can easily be substituted for something else. It’s like going to the grocery store to buy cereal. Some people must buy the name brand of certain types of cereal and others are fine with the store brand. It just depends on what you feel brings the most value to you. 

What Is Left Over?

The bottom half of the Profit & Loss answers the question most if not all business owners want to know which is did I make any money? The bottom-line number is what we all work for right? :) It is good to start with a goal in mind before you start analyzing this number or else it’s just a number without context. If you have generated more sales than expenses then you will have a net profit if you have generated more expenses than sales then you have a net loss as your bottom line number. 

Financial reports help to shape the story of your business. One of the most important questions that all business owners want answers to is are they making any money? The Profit & Loss answers this question by breaking down the report into three sections arriving at the bottom line number which tells you if your business is making any money. It is more helpful to have goals and metrics to analyze your numbers against to spot trends and to make sure you are successfully hitting your business's financial goals.

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How Can I Measure How Well My Business Is Doing?

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You are busy. 

Let’s just establish this fact upfront. 

There are kids to pick up & drop off, shopping to be completed at the grocery store, a house that needs to be kept tidy and that is just the first part of your to-do list. Next, you put on your CEO boss hat and there is a whole list of things that need to be done underneath that umbrella like delivering exceptional customer service, marketing efforts, networking events, professional development, customer meetings, performing the service you offer, and if you have a team then that creates yet another to-do list. 

I am guessing that you haven’t gotten around to looking at your financial reports yet. 

I GET IT!

However, it is super important to check in regularly on the financial status of your business to see how well your business is doing. This can be done weekly or monthly but a regular cadence must be established. So now that you are penciling in this essential task item, let's take a look at how you can measure how well you are doing in your business by looking at your financial reports starting with the Balance Sheet.

The Balance Sheet

The Balance Sheet takes a snapshot of the financial status of your business at a specific point in time. It answers the following questions: 

• What do I own? This can be found in the asset section of your Balance Sheet.

• What do I owe? This can be found in the liabilities section of your Balance Sheet.

• What is left in my business after that? This can be found in the equity section of the Balance Sheet.

The entire picture that can be provided by looking at the Balance Sheet is to assess the net worth of your business. If you were going to sell your business to an interested party does it look attractive?

The Asset Section

In the asset section, you will find the balances of your checking accounts, savings accounts, and any other liquid account meaning if you needed cash you could hypothetically go get the money out of your account. Additionally, you can find the accounts receivable account which keeps track of what customers owe you, equipment, and intangible & tangible assets. The most liquid assets are usually listed first. The more cash you have to take care of operational expenses the better. 

The Liabilities Section

In the liabilities section, you will find all the vendors you owe like your suppliers, credit card companies, any bank loans, lines of credit, and vehicle loans. This section is broken down between current liabilities like accounts payable or vendor payables versus long-term liabilities like bank loans. The liabilities section tracks your obligations to outside parties. This is similar to how you would keep track of your personal finance activity like your mortgage loan, car loans, and personal credit cards. The less you owe others the better. 

The Equity Section

The equity section shows what is left in your business. Investopedia states, “Equity is the remainder value when liabilities are subtracted from assets.” Additionally, the Corporate Finance Institute shares that, “Equity, in the simplest terms, is the money shareholders have invested in the business including all accumulated earnings. The equity section shows the changes in company equity, from an opening balance to an end-of-period balance. The changes include the earned profits, dividends, inflow of equity, withdrawal of equity, net loss, and so on.” 

In other words, this section keeps track of any money that you contributed to your business since its inception which includes any bank account balances that were used to establish the bookkeeping records which are called opening balances. It also includes any money you took out of the business via the ATM or maybe you mistakenly paid a personal expense from your business account (which is a no-no :) but it happens. This is listed as a draw or distribution depending on the entity type of your business. 

All of this is important to understand as the business owner and is a mouthful. I was originally going to cover all 3 financial statements: The Balance Sheet, Profit & Loss, and Statement of Cash Flow but decided to break it down into chunks because it is a lot of meat to chew on. 

I hope this information is helpful to you as we travel on the road to see how to measure the financial well-being of your business.

Keep IT Sunny~

Should I Use Budget & CashFlow Forecasting Reports In My Business?

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As a small business owner, I understand that you most likely did not get into business to look at budgets and cash forecasting reports. 

You probably would rather chew paper than think about those words and I certainly would understand. Let’s start with defining exactly what both of these words mean.

According to Nerd Wallet, “ A budget is a way to balance income, expenses, and financial goals for a specific length of time.” I think of it as a roadmap for your business finances that helps you stay in control.

In the same spirit, “A cash flow forecast according to Business.vic.gov.au, involves estimating cash coming in and going out based on past business performance.”

Why Should You Care?

There are a ton of benefits to using these reports regularly in your business: 

• Resource Allocation

• Financial Planning

• Tax Planning

• Cash Flow Management

• Risk Management

• Goal Setting

• Cost Control

• Performance Management

The list could go on but I think you get the idea. 🙂

There are numerous benefits to utilizing budget and cash flow forecasting reports in your business. It can help you to stay in control of your finances, make informed decisions, and help overall with meeting the goals you have for your business.

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The Importance Of Working Capital Management

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Successfully managing working capital is the lifeblood of any business. Let’s first define working capital. According to Netsuite.com, “Working capital is calculated by subtracting current liabilities from current assets, as listed on the company’s balance sheet. Current assets include cash, accounts receivable, and inventory. Current liabilities include accounts payable, taxes, wages, and interest owed. Additionally, key attributes are:

Working capital is a financial metric calculated as the difference between current assets and current liabilities.

Positive working capital means the company can pay its bills and invest to spur business growth.

Working capital management focuses on ensuring the company can meet day-to-day operating expenses while using its financial resources productively and efficiently.

Here are a few reasons why working capital management is important:

Managing working capital successfully helps with meeting your short-term obligations and ensures you have enough liquidity in your business to fund day-to-day operational expenses like payroll, utilities, and other business expenses.

Managing working capital well means that if an operational interruption occurs like Covid you have enough money to keep the business running and prevent major disruptions.

Efficient working capital management can help with managing debt and increasing profitability.

Successful businesses understand the importance of keeping a keen eye on their working capital and cash flow. It is extremely important to put together a plan to manage working capital on a regular basis to ensure your business stays healthy and strong.

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How To Successfully Manage Debt In Your Business?

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Picture this:

You have a growing business, your customers are happy and you are happy providing services to them. The sales are increasing month after month and finally, all your hard work is starting to pay off. There is one problem. You are exhausted and hiring a new team member would be so helpful to take the strain off you and help to keep the momentum going in your business.

You decide to tap into loan solutions to help with cash flow. This isn’t a bad idea but is it a well-planned idea?

Many times as business owners we have to make decisions on the spot to keep progressing forward but using debt without planning for how you will pay it back can be a recipe for disaster. 

What are some key things to consider to successfully manage debt in your business?

• Create a budget plan for how you will pay the loan back.

• Make sure you are considering your business goals when taking out the loan.

• Don’t overleverage yourself and take on too much debt.

• Manage your working capital.

• Monitor your cash flow.

• Negotiate good terms that you are comfortable with.
  

  The financial challenges that entrepreneurs face when they are in a growth phase can be tough. The key to successfully managing debt is first understanding all the moving parts associated with servicing the debt and making a realistic plan to pay it off as soon as possible.

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Got Cash? 3 Tips To Manage Cash Flow

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Cash flow management is critical for any business's success. According to efinancemangement.com “The fundamental goal of cash flow management is to ensure that the incoming flow of funds is always greater than the outgoing so that the business sits on a surplus. 

Here are 3 tips to help you to achieve this goal:

Tip One - Create an emergency fund for your business

According to PNC Bank, “Surveys show that 17% of business owners say that if faced with two months of declining revenue they would have to close, and other statistics show that 25% of businesses won’t open again after a disaster.” Think about what happened as a result of the pandemic. The first step to creating an emergency fund is understanding how much you need to operate each month and how many months you would like your emergency fund to cover.

Tip Two - Create a Budget

This tip goes hand in hand with creating an emergency fund. This is about going deeper to dig out specific information to create categories of spending so that you can create a plan that is realistic based on your past experiences.

Tip Three - Track Your Money 

This one is the most important tip because if you don’t know where your money is going you can’t create a plan for it. 

Successful cash flow management is key to running a successful business. It starts with getting clarity about the current status of your finances. Additionally, creating an emergency fund and a budget will help you to achieve your goals and stay cash flow positive.

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What Do Banks Look For When Deciding To Give A Business Loan?

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Your business is growing and you need more time in the day to do everything. A new team member would be great BUT you want to maximize cash flow and some of your cash is still on its way. 

What do you do?

It’s like the chicken and the egg because you need one thing to do the other. It might be time to look for a business loan at your local bank but you are not sure what they will ask from you. 

Today I want to share the top 3 things banks look for when giving business loans.

Number One: Credit History

We all understand the importance of having good credit but some of us might need help understanding one of the easiest ways to get there. Sorry, this will not be earth-shattering news. I was recently at a local networking event sponsored by US Bank and one of the panel guests from US Bank said the best practice for having good credit is using no more than 50% of your total credit utilization. She went on to say of course not carrying a balance month to month is also a great way to establish good credit. If you need help achieving this goal check out a goals coach courtesy of US Bank. 

Number Two: Business Plan

The banks want you to show them your plan before they show you the money. It makes sense and we see this even on popular tv shows like The Shark Tank. The sharks always start by asking about elements of the entrepreneur's business plan like asking about sales projections, who is their target market, and many other questions. It starts with your business roadmap. If you need help with getting started on this check out SCORE.org  for help.

Number Three: Financial Statements

Yes, the banks want to look at your business health through the lens of your financial reports. The financial reports tell the story of your business. The income statement tells the story of your sales, expenses, and what was left. The balance sheet tells the story of what you own, owe, and what remains as equity in your business. Additionally, banks look at the financial statements to locate trends in revenue, profitability, and cash flow. They are looking for strong healthy businesses that will be able to pay them back. If you need help with creating your business financial story I am always here to help.

To recap, you need money because there are only 24 hours in a day, and hiring a new team member is paramount. Additionally, you want to maximize your cash flow and use O.P.P. (other people's money:) to help grow your business. The banks are looking for 3 key things which are good credit, a solid business plan, and your financial story via your financial statements. My challenge to you is to take a hard look at your business and these three criteria to see if your ducks are in a row. If they are not in a row try scheduling 15 minutes per. day to work on them.

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What Services Can A Bookkeeper Provide For My Business?

The industry of bookkeeping and accounting has changed over the years. Traditionally a bookkeeper has been the one-stop shop for small business owners to handle all things related to the daily upkeep of their debits & credits. In recent years, the role of a bookkeeper has started to include taking on the role of business advisory with clients to explain what the numbers mean and how you can use them to help meet your business goals. 

A bookkeeper can provide the following services & more:

• Monthly bookkeeping management

• Weekly bookkeeping management

• Cash Flow Analysis

• Budget preparation

• Tech Stack Consulting

The list really depends on the unique needs of your business but the idea of a gray-haired lady or wired-brim glasses guy sitting in a corner with a paper ledger are things of the past. The 21st-century bookkeeper is utilizing technology to deliver real-time results for clients.

I hope this brief list sheds light on a bookkeeper's various services. Share in the comments below what current things you are struggling with related to your bookkeeping.

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4 Ways A Bookkeeper Can Help You In Your Business

You started your business because you were passionate about something and wanted to put your personal stamp on it. I know that sounds very general but at the root of every business owner's business is their passion for doing something that they could own. 

I am sure bookkeeping was not on your list:)

Many business owners might only see the QuickBooks Online commercials that pop up on t.v. during tax season and the thought of bookkeeping pops into your mind. I get it. Bookkeeping and accounting are not for everyone. You might have thought what can a bookkeeper help ME with? I have my spreadsheet and my shoebox and life is going fine.

Here are 4 ways a bookkeeper can help you:

• Help you get ready for tax compliance season - Yes this one is pretty popular from January to April but a lot of work needs to be done before these months roll around. 

• Help you get ready for tax planning -  If you are not already having tax planning meetings with your tax professional BEFORE you see them at tax time you could be missing out on many tax advantages. I can assure you that your tax professional wants clean books and a fresh copy of your financial statements to peruse while they chat with you about your tax strategies.

• Help you with managing daily & monthly operations - This is all the stuff that it takes to run your business financially. Let’s say you are getting very busy and want to hire some new team members. Do you have enough cash flow to support this? What do your monthly expenses currently look like? How much-projected revenue are you expecting to bring in? These are all questions that a bookkeeper can help you answer so that you don’t have to worry about hiring and then laying off your new team members due to a lack of funds. 

• Help with making strategic business decisions - Do you want to grow your business in different locations or provide new services? What is your goal for the business 5 years from now? In order to make your goals a reality it is important to look at the numbers and start creating a plan to make sure you hit those targets with no problem. 

The list of ways a professional bookkeeper can help you are endless and in my view depends on your goals. I hope this list answers your questions about what a bookkeeper can help you with. I would love to hear from you to learn more about your business and goals for the future. 

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Quick Tips To Stay Ready For Tax Time!

Photo by Nataliya Vaitkevich: https://www.pexels.com/photo/tax-documents-on-the-table-6863244/

Taxes - This word will make grown adults fold into the fetal position. It is filled with dread and stress. It has been around since the biblical days and it isn’t going anywhere. If you work for yourself then taxes can really seem scary. When you worked for someone else it was there problem to take care of and now it is yours.

No Fear

I know all things taxes can really put a damper on your day but I wrote a previous blogpost to help all the stress melt away and prepare you for smooth sailing during tax time. Check it out here.

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Are Your Finances In Shape?

We are almost halfway through the year. I am starting to see clients who are in need of cleanup bookkeeping help to be ready for the tax extended deadline in October. I am here and ready to help. 

It is always good to stay ahead of making sure that the books are in shape to take advantage of opportunities in addition to making sure you are ready for tax time. Last year, I wrote a blog post about this that has tips to help you navigate staying on track with your finances. 

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