How to Manage Business Finance Effectively
As a beginner entrepreneur, you certainly want a business that is being pioneered success is not it?
If you are currently preparing or even starting a business, you should note that one of the keys to business success is financial management.
Understand it, almost all important aspects in the business related to money. Starting from the procurement of raw materials, business lease, transportation, promotion, salary and many more. All require proper and systematic setup and operation.
1. Separate between personal / family accounts with business accounts in managing business finances
This is the first to-do list you should pay attention to. Many business actors neglect this important issue so that personal money is often mixed with company money.
And with the separation of accounts, you more easily measure business growth. Immediately open a new checking account intended specifically for business.
2. Determine the percentage in business finance management
Determining the amount of financial percentage to be used for business needs is the second to-do list after you separate your personal money with business money.
Determine how much percent of the money is allocated for business operations, what percentage of target profit you want to achieve, what percentage of money for business cash reserves and what percentage of money for business development.
This will help you manage your business finances in accordance with the portion set at the beginning of your business.
Do not forget to allocate monthly expenses, including your salary. Although this is your own business, allocate your salary according to the responsibilities and figures of your needs. If you are forced to borrow business money, record as a cash / debt that must be returned later.
3. Create a bookkeeping to manage business finances
Enterprises are not sufficiently managed on the basis of memory. There should be a complete record. Ideally you have financial statements such as ruby / earnings records and balance sheets. But if it is not possible because it is still a new venture, at least you can make a report in and out cash money (cash flow).
Every day, match the balance of money with your notes. Thus you can control all financial transactions. Both in terms of income, expenses, and payable and receivables owned in the company. Besides, a neat bookkeeping will also make it easier to evaluate in the business development.
Make a projection note of the cash flows. With that projection, you will know when it’s time to receive money, when to spend money. You can also check whether the company still has cash or not. With cash flow record, we can anticipate and find ways before going minus.