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Achieve financial security for your business in 2015 with these eight tips

by , 02 December 2014
Running a business can be nerve racking. You never know if you'll make enough money to cover your expenses, let alone make a profit. You might wake up one morning and realise your business has to close down because you just don't have the money to keep it going.

But here's the thing, achieving financial security for your business is easier than you think. And it certainly doesn't require a magic lamp.

I have eight easy tips you can use to achieve financial security for your business in 2015 by managing your money effectively.

Read on to discover what they are so your business can prosper...

 
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Use these eight tips to achieve financial security for your business

 
Tip 1: Treat savings like an expense
 
But if you actively set aside an amount for savings as one of your company's 'expenses', you're guaranteed at least some profit.
 
Tip 2: Start setting aside money as soon as you can
 
Unexpected expenses, like needing to buy a new server for your office, can happen at anytime. If you start putting away business savings today, you'll have the money to cover those expenses when they happen. 
 
Tip 3: Consider all your expenses in your business financial plan
 
To achieve financial security for your business, you need a financial plan. Unfortunately, many business owners leave out some of their expenses when they do this. As a result, their plan doesn't actually cover the range of expenses they have to pay. 
 
For example, if you forget to include the cost of medical aid contributions for your employees, your plan won't reflect how much money you actually spend each month. 
 
Tip 4: Create a budget for every month
 
Create a budget for each month and take into account the targets you want to achieve. This will ensure you get the profit you want at the end of each month.
 
For templates of ten of the most common business budgets, check out the Master Budget Series.

Tip 5: Constantly reassess your company's finances
 
It's important to stay informed about your financial position, risks and growth. If things change for better or worse and you don't know about it, you could lose out big time. Reassess your company finances at least once a quarter.
 
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Tip 6: Take advantage of tax deductions wherever possible
 
Tax deductions are a great way to improve your cash flow. Organise your company's finances so you pay as little tax as possible and get the most back from SARS. 
 
You can find 47 business deductions you can take advantage of in 47 Allowances and Deductions.

Tip 7: Have a succession plan
 
It's important you deal with any changes in management (e.g. if a key manager leaves or dies) so you don't lose any productivity. 
 
It may seem cold hearted, but your business may collapse if you don't take steps to deal with these changes fast.
 
Tip 8: Make the most of a good financial period
 
Some months you might bring in a lot of profit and other months, barely any. In the months when you have money to spare, invest it to generate more resources. 
 
If you know you need new equipment, get it when you can afford it, instead of waiting until it breaks. 
 
Financial security is all about being smart with the way you run your business and handle your money. Use these eight tips and soon you'll discover the success that comes with achieving financial security for your business.
 
For more information on planning your business's finances for 2015, check out the Practical Accountancy Loose Leaf Service
 


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