When we run a medium and small business, whatever the form, both online and offline, but we cannot calculate the losses or profits earned every month, of course there are irregularities in managing finances. I also often meet the finances of small and medium entrepreneurs, there is no separation between personal money and business money, for example taking goods/money for personal use. Meanwhile, personal withdrawal will reduce capital and increase income as a percentage. It will be different if you earn your salary from working on your business, which is treated as an expense and will reduce business profits and will also reduce income taxes. So business finances need to be managed properly and correctly, so that your business will run smoother.
How do you manage business finances?
- Thread starter Suba
- Start date
The best thing to do is to hire a professional accountant to help you manage and run the finances. If you can't afford it, find someone who has worked in that capacity somewhere even though not a professional. It would help your business to stabilize it's finances. B
Yes, we need to separate personal money and business money. So that it's easier to manage, and there are no attempts to abuse or spend with no clear purpose. I also do this, so I can easily find out how much business capital I currently have.
- Thread starter
- #8
We don't need to hire an accountant with a high fee, but we can start from ourselves, especially we have to separate business finance and personal finance, you need to record all business transactions, so you can find out cash income and expenses, you can use software like Google Sheets or Microsoft Excel, and make a business financial plan.
You are right, we can do it ourselves. I used to do it in a simple way. I recorded all sales and expenses on that day, so that profit/loss was found. If there is profit, most of it I put into the personal money group, and a small part I put in the business money group. So, I had 2 wallets at that time. LOL
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- #10
Your first step is correct, but you must also record personal withdrawals, whether in the form of money or goods. What many business people do is take merchandise for gifts to friends or relatives. Next you need to plan your business finances, for example 10% of business profits are saved and used as a short-term investment.
Yes you are right, of course I always write it down. So that when I know how many items are still in stock, which items need to be restocked again, which items are not selling well so I don't need to restock again, what new items need to be added to the purchase list to increase sales, etc.
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- #12
Whatever type of business you are in, you will need to prepare financial statements, you can use software or ask for help from an accounting expert, from the balance sheet you can see all posts such as total inventory, total assets and liabilities, and capital etc.
The size of the business plays a very big role if you are going to be needing a professional accountant to help you run your business financial account books.
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- #16
I agree with you, one of the goals of the financial business is efficiency, eliminating unnecessary expenses, allocating funds to posts that are more in need, utilizing resources, for example renting out empty warehouses,
Well there are so many ways to manage ones finance when they are into business and especially if it is a small scale or medium scale business and one of them is to cut your expenditures and be more calculative in all that you do.
All businesses need to manage their finance properly. Keep a record of every business transaction. Keep track of the cash flow situation. For small business, you may hire a part time accountant to prepare profit and loss statement so that you have a clear picture of the financial status of your business.
