Tips for Small Business Financial Planning
If you have started a small business or you plan to, you have probably experienced the excitement and anxiety that comes with a new adventure. Your focus may be creating a great product or offering a great service. You may also spend a lot of time on your marketing plan and customer acquisition, not to mention hiring your staff. Unfortunately, because of the amount of time required to handle all these tasks, your business’s financial planning may take a back seat, but this is a mistake. These are a few tips to help you with your financial planning tasks.
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Set and Separate Your Goals
Although it may seem counterproductive, your first step in your small business financial planning is setting your personal and business goals. Your personal goals should include your priorities and short-term goals (less than one year), but they should also include five- and 10-year goals. Personal goals may include getting more exercise, finishing your college degree, starting a family, purchasing a home, etc.
Once you have your personal goals written down, you should start working on your business goals. Use the same format, priorities, short- and long-term goals. For example, priorities may include hiring the right staff members, creating or implementing your marketing plan, etc. Your goals may include your revenue for the year, five years and 10 years. What are your growth projections?
Then, you need to separate these goals. You don’t want to compromise either your personal or business goals by mixing your finances. You need to set priorities. For instance, do you value time with your family over business growth? What about your child’s education fund versus reinvesting in your company to expand your product lines?
Investigate Outsourcing Opportunities
As a new business, you may think that you need to do everything on your own. For example, you may consider doing your own taxes rather than hiring a professional, but this could be to your detriment rather than to your benefit. Professional CPAs understand the tax code and will find you every deduction your business qualifies for, reducing your tax burden. These savings may be well above what you would save by doing your own taxes.
You may also look into outsourcing other functions, such as answering phones, general accounting and human resources duties, etc. These duties can be time-consuming, and if you have to hire dedicated staff, you will pay far more in salary and benefits than you may pay to outsource these tasks unless your business is to provide these tasks. By outsourcing you free yourself and your staff to focus on creating and providing great products and services. You will also have more time to spend with your family.
Not only will these tips, separating your goals and outsourcing, improve your company’s financial position, but they will also improve your work-life balance.