Accounts receivable and cash flow are intimately intertwined. For many businesses, accounts receivable are the primary source of cash flow, so it is critically important that they are managed rigorously and proactively.
Cost accounting or “costing” is a key tool to achieve those goals and many more. Detailed, accurate costing can provide valuable insights, but many business owners struggle to account for their costs or don’t fully understand the numbers their accountants or bookkeepers present to them in costing reports.
When you outsource a non-core aspect of your business like your financial processes, you free up time, energy, and resources to focus on what really matters: your business’ profitability and growth. A proven, reliable financial process outsourcer can take a variety of tasks off your plate and probably do them better at the same time. Let an outsourcer’s employees do what they do best, and free yourself and your employees to focus on building a great business.
Now that economists say high inflation rates may be with us for the foreseeable future, businesses are a being forced to address those price pressures by raising prices. Business owners worry – justifiably – that they might lose customers if they raise prices, or raise them too much. Let’s look at some of the ways that price increases that can be approached while reducing the risk of lost sales.
In the current business environment with interest rates on the rise, it is a good time to ensure that your cash forecasting process is optimized. Businesses that have previously relied on cheap, readily-available loans as their backup plan for any cash emergencies may now find that such loans are no longer cheap nor readily available. By focusing on and improving your cash flow forecasts, you can better anticipate any issues that might arise and take steps to mitigate or prevent those issues before they become a problem, and protect your business from one of the main causes of enterprise failure: running out of cash.
For most companies, spending money on marketing to drive sales and revenue is a given, but determining “how much” is often a haphazard process rather than based on thoughtful planning and accurate analysis. When businesses set realistic, reachable goals based on accurate expectations of return on marketing investments, they tend to see not only steady, reliable growth, but several other positive benefits as well.
Accepting credit cards is a fact of business life these days. Customers prefer and expect the convenience of credit card payments, and in any case, they often don’t carry cash or checks anymore. But along with accepting cards comes the fees associated with them – fees that are borne by your business. Some of these are unavoidable, but many businesses end up needlessly overpaying and cutting into their bottom line. Let’s briefly look at how payment processing works, and where you can take action to ensure that your business is coming away from credit card transactions with the most profit possible.
COGS is more than just a number pasted into the accounting spreadsheet. It can give you clues about the health of your business, point to steps you might take to improve your profits, help recognize tax opportunities or risks, and look for growth opportunities.
Making one of these ten common tax mistakes could be costing you money. Find out what they are and how to avoid them.
Making one of these ten common tax mistakes could be costing you money. Find out what they are and how to avoid them in part two.