flevyblog

Flevy Blog is an online business magazine covering Business Strategies, Business Theories, & Business Stories.
MANAGEMENT & LEADERSHIP STRATEGY, MARKETING, SALES OPERATIONS & SUPPLY CHAIN ORGANIZATION & CHANGE IT/MIS Other

Small Business Financial Management Strategies

Editor's Note: Take a look at our featured best practice, Advanced Financial Model with DCF & Valuation (Excel workbook). General Overview Advanced Financial Model including DCF & Valuation, suitable for any type of business/industry and fully customizable. Template is built using Financial Modeling Best practices and includes Scenario basis 3 Statement Financial Model for First Year and up to 10-Year Forecast [read more]

* * * *

Protect company finances and tax optimization, company investmenMaking a profit is the goal of every small business, but managing finances can often seem like an obstacle towards achieving that end. Nearly half of small business owners say bookkeeping is their least favorite part of running their business, according to a TD Bank survey. One in five business owners say managing their money and finances keep them up at night worrying. Fortunately, managing your small business finances doesn’t have to be a nightmare. Here are some simple strategies you can implement to help you better manage your business finances.

Automating Your Financial Management

One reason small business owners find financial management cumbersome is because they’re still trying to do it manually. Nearly half of small business owners don’t use modern technology to handle their accounting, a Yodle survey found. But using a cloud-based accounting system such as QuickBooks Online or Microsoft Dynamics can save you tons of time and work by letting you automate processing of items such as transaction reporting, expense reporting, inventory and tax preparation. Automation also reduces the risk of data entry errors, which can be time-consuming and costly. 52 percent of business owners see a reduction in financial errors after adopting accounting software, according to a Capterra survey.

Pursuing Financial Goals

Managing your finances becomes easier when you have clear financial goals. The Hartford recommends that you set your business goals by first articulating a vision that defines what you want your business to achieve. You can then select financial goals that align with this vision and start considering tactics to achieve these goals. Make your goals measurable so that you can track your progress and make adjustments. For instance, instead of saying you want to make more money, define a specific revenue target, such as saying that you aim to double your revenue by this quarter next year. Then start defining tactics that will enable you to reach this goal, again using measurable numbers. For instance, if your goal is to double your revenue, how many more sales would it take to achieve this? How many prospects would you need to reach to make that many sales? How much would that require you to spend on marketing?

Multiplying Your Revenue

A major financial goal for any business is increasing revenue. Marketing legend Jay Abraham says that there are three key ways to grow your revenue for any business: increase the number of customers you sell to, increase the average amount per purchase your customers buy or increase the number of times your customers buy from you. You can increase your revenue by improving your numbers in any one of these areas, or you can multiple your revenue exponentially by boosting your numbers in more than one area. To achieve this, you might set goals such as increasing the number of views your Facebook page gets, adding a premium product to your product line or developing an upsell program to generate more repeat business.

In addition to using these methods to grow your main line of business, you can raise more capital for your business by diversifying your income streams. For instance, you might get involved with a direct sales program like Amway to open up another source of income, or you might sell services through an on-demand platform such as TaskRabbit or Stocksy.

Reducing Your Expenses

Cutting your expenses can be another way to boost your bottom line. Small business strategist Donna Marie Thompson recommends several approaches you can take to cutting costs. One is to review your expense categories and look for ways you can trim individual items. For instance, you may be able to cut payroll costs by outsourcing, or you may be able to cut IT costs by using a cloud-based solution instead of an on-premises server.

Another approach is focusing on costs associated with a particular product or service. For instance, you might see if you can cut costs by using a different material, supplier or shipping method.

A third approach is cutting costs geographically by focusing on expenses associated with a particular location. For instance, if one of your branch locations is unprofitable, you might consider whether those resources would be better deployed elsewhere.

Excel workbook
he template provides a 3 statement model that links the income statement, balance sheet, and cash flow statement into one dynamically connected financial model. This model acts as the base on which more advanced financial models are built, such as discounted cash flow (DCF) models, [read more]

Do You Want to Implement Business Best Practices?

You can download in-depth presentations on Integrated Financial Model and 100s of management topics from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.

For even more best practices available on Flevy, have a look at our top 100 lists:

These best practices are of the same as those leveraged by top-tier management consulting firms, like McKinsey, BCG, Bain, and Accenture. Improve the growth and efficiency of your organization by utilizing these best practice frameworks, templates, and tools. Most were developed by seasoned executives and consultants with over 20+ years of experience.

Readers of This Article Are Interested in These Resources


Excel workbook
Of all the new kinds of enterprise solutions made available by the advent of the internet, one of the most disruptive, most useful and most recent has been the software as a service (SaaS) business model. SaaS is a delivery model in which a centrally hosted software is licensed to customers [read more]


 
Excel workbook
 
 
Excel workbook

About Shane Avron

Shane Avron is a freelance writer, specializing in business, general management, enterprise software, and digital technologies. In addition to Flevy, Shane's articles have appeared in Huffington Post, Forbes Magazine, among other business journals.

,



Complimentary Business Training Guides


Many companies develop robust strategies, but struggle with operationalizing their strategies into implementable steps. This presentation from flevy introduces 12 powerful business frameworks spanning both Strategy Development and Strategy Execution. [Learn more]

  This 48-page whitepaper, authored by consultancy Envisioning, provides the frameworks, tools, and insights needed to manage serious Change—under the backdrop of the business lifecycle. These lifecycle stages are each marked by distinct attributes, challenges, and behaviors. [Learn more]

We've developed a very comprehensive collection of Strategy & Transformation PowerPoint templates for you to use in your own business presentations, spanning topics from Growth Strategy to Brand Development to Innovation to Customer Experience to Strategic Management. [Learn more]

  We have compiled a collection of 10 Lean Six Sigma templates (Excel) and Operational Excellence guides (PowerPoint) by a multitude of LSS experts. These tools cover topics including 8 Disciplines (8D), 5 Why's, 7 Wastes, Value Stream Mapping (VSM), and DMAIC. [Learn more]
Recent Articles by Corporate Function

  

  

  

  

  

The Flevy Business Blog (https://flevy.com/blog) is a leading source of information on business strategies, business theories, and business stories. Most of our articles are authored by management consultants and industry executives with over 20 years of experience.

Flevy (https://flevy.com) is the marketplace for business best practices, such as management frameworks, presentation templates, and financial models. Our best practice documents are of the same caliber as those produced by top-tier consulting firms (like McKinsey, Bain, Accenture, BCG, and Deloitte) and used by Fortune 100 organizations. Learn more about Flevy here.
  


OUR CORE OFFERINGS
Flevy Marketplace: Top 100
· Strategy & Transformation
· Digital Transformation
· Operational Excellence
· Organization & Change
· Financial Models
· Consulting Frameworks
· PowerPoint Templates
FlevyPro (Subscription Service)
KPI Library
Streams (Functional Bundles)
Flevy Executive Learning (FEL)
PowerPoint Services

FREE Resources

About Flevy
Management Topics
Marcus (AI-Powered Consultant)
Partner Program
LinkedIn Influencer Marketing
FAQ / Terms / Privacy / Blog
Contact Us: support@flevy.com



CONNECT WITH US!
       
TOP 100 TRENDING TOPICS
Acquisition Strategy
Agile
Analytics
Artificial Intelligence
Balanced Scorecard
Best Practices
Big Data
Breakout Strategy
Business Continuity Planning
Business Plan Financial Model
Business Transformation
CMMI
COBIT
Change Management
Cloud
Communications Strategy
Company Financial Model
Competitive Advantage
Competitive Analysis
Consulting Frameworks
Continuous Improvement
Core Competencies
Corporate Culture
Cost Reduction Assessment
Customer Experience

BROWSE BY FUNCTION
Strategy, Transformation, & Innovation
Digital Transformation
Operational Excellence and LSS
Organization, Change, & HR
Management Consulting

Customer Journey
Customer Service
Cyber Security
Data Privacy
Decision Making
Digital Marketing Strategy
Digital Transformation
Digital Transformation Strategy
Due Diligence
ESG
Employee Engagement
Employee Training
Enterprise Architecture
Growth Strategy
HR Strategy
Hiring
Hoshin Kanri
ISO 27001
ITIL
Information Technology
Innovation Management
Integrated Financial Model
Kaizen
Kanban
Key Performance Indicators

ADDITIONAL RESOURCES
Business Strategy Frameworks
Case Studies
Consulting Training Guides
COVID-19 Trend Data
Digital Transformation
Financial Advising Services (FAS)

Knowledge Management
Leadership
Lean
Lean Manufacturing
Logistics
M&A (Mergers & Acquisitions)
Manufacturing
Market Research
Marketing Plan Development
Maturity Model
McKinsey PowerPoint
McKinsey Templates
Operational Excellence
Organizational Change
Organizational Design
Performance Management
Post-merger Integration
Pricing Strategy
Process Improvement
Process Maps
Procurement Strategy
Product Launch Strategy
Product Strategy
Project Management
Quality Management


Free Resources
KPI Library
Lean Management
Lean Six Sigma Training Guides
Marcus Insights
Operational Excellence

Real Estate
Remote Work
Restructuring
Risk Management
Robotic Process Automation
SWOT
SaaS
Sales
Scrum
Service Design
Six Sigma Project
Social Media Strategy
Strategic Planning
Strategic Thinking
Strategy Development
Supply Chain Analysis
Sustainability
Target Operating Model
Team Management
Total Productive Maintenance
Value Chain Analysis
Value Creation
Value Stream Mapping
Visual Workplace
Workplace Safety


Product Strategy
Small Business Owner
Startup Resources
Strategic Planning
Strategic Planning Process
Value Innovation Strategy


© 2012-2024 Copyright. Flevy LLC. All Rights Reserved.