How to Keep Your Business on The Right Financial Track

As your business grows and evolves, you need to take stock of what’s changed since its inception, looking to the future to see how you need to evolve in order keep it on the right track. Financially, this could be taking a second look at your original business plan and making some changes to fit the current times. You should also look toward your accounting and bookkeeping and determine if you may need some help in the form of productivity software. Finally, as part of your business reevaluation, you should plan ahead for that time (a ways in the future surely) when you’ll need to pass on ownership of your prized business.

Reevaluate your business plan

Before you started your business, you likely made a detailed business plan (you better have!). To keep your business on the right track, however, you have to treat that plan like it’s the Constitution. Sure, you don’t want to severely alter course and change your main guiding principles, but your business plan must be a living, breathing document that can be altered if necessary.

Have you introduced a new product or service or do you have a new source of revenue? You need to update your business plan to account for that.

“A new revenue stream will impact how you manage your resources – and can impact profitability. Let partners and investors in on your vision to get their buy-in and help with execution,” says Entrepreneur.

Have you expanded? Do you face new competition? What have you learned in the past that you need to change moving forward? Don’t be stagnant. If you want to stay on track financially, you must be able to adapt your business plan.

Make use of technology

There are so many ways to use technology to help your business run smarter and safer - why not make use of them?

First of all make sure your financing information is backed up.

“We’re fortunate enough to live in an age where it’s not always necessary to hang on to boxes of potentially important paper documents for years on end. However, that doesn’t mean that you can simply save a file to your desktop and walk away. Backing up your information is absolutely essential—and luckily, you have more than a few options. Online storage services are plentiful, and there are ones that fit any budget,” notes AbleLending.com.

You should also invest in accounting/bookkeeping software unless you’re a finance guru. There’s really no excuse to give up on the opportunity to have the safety and analyzation features that many of these services offer.

Check up on your debtors on a regular basis

There’s nothing that will knock a business of course than failing to recognize when they don’t receive payment for services rendered. Run accounts receivable reports and run them often. Don’t let payments lag.

Make plans for your business to survive if ownership changes hands

“Transferring ownership of the family business to a new generation is often more complicated than it sounds. Additional tax implications, such as estate and gift taxes, generally arise for both parties. Proactive succession planning can help provide business stability, prepare for tax obligations, and make the ownership transfer as smooth as possible,” says the US Small Business Administration.

It’s important to put into place the mechanisms for ownership transfer as soon as possible - even if you have no plans to transfer your business anytime soon. You want your property to go to your successor, no matter what the circumstances (death, retirement, etc.)

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