Want to see improvement in your business or brand’s bottom line? Pay attention to your company’sFinancial Variables and discuss these influences with a qualified accounting professional to determine if your revenues can be improved, or to learn more.
Five financial variables that can improve your bottom line are:
1) Look at your Profit & Loss Statement
When was the last time you looked at your Profit and Loss (P&L) statement? This document lays out your revenues, expenses, and costs during a determined period of time.
All public companies are responsible for issuing these statements quarterly, as well as at the end of the fiscal year. Reviewing and understanding a P&L statement can help you evaluate your business’ fiscal health.
2) Know the Shape of your Finances
Over half of small businesses are negatively impacted by late payments; how are your finances? Make a resolution to pay invoices on time and save late fees and charges. These expenses impact your cash flow and bottom line, over time.
3) Get Familiar with Your Cash Conversion Cycle
The cash conversion cycle (CCC) measures the amount of time that it takes to move inventory, get paid, and, in turn, pay your own creditors. This cash flow determines how long between payments as well as how quickly you can turn-over your product.
A familiarity with your CCC can indicate if you have a healthy cash flow as well as how long your company can survive in tight times.
4) Become More Aware
Part of your business self-awareness comes from checking out your financials. Develop and revisit a cash flow forecast and business budget for your company.
It makes good sense to set aside a time, such as the end of the fiscal year, to review all your management practices and financial habits with a reliable and reputable accountant. Don’t have an accountant? Make now the time to retain one.
5) Tally Cash on Hand
Do you know how much cash and liquid assets you have on-hand? It may surprise you; sometimes, companies don’t have as much readily available capital as they think – and need- which could put you in a bind if business is slow.
Don’t risk the fiscal health of your company; take time to count up what you have on hand for liquid assets, i.e. cash, and begin to think about setting up a rainy-day fund.
Making changes or deciphering financials for your business can be confusing; make sure to discuss your options further with your accountant before altering the way you operate your company. These industry experts may be able to help guide and advise you on the best ways to reach a better bottom line.
Want to learn more about these financial variables, or other ways to enhance the condition of your company? Talk to the accounting professionals atBMH Accounting; they are familiar with financial variables that can make a significant difference in the overall value of your business investment.
Want the key to reaching your business and professional goals? ABusiness Strategic Plan helps develop and identify an effective strategy for attaining and reaching milestones that lead to the fruition of your goals. Here are some tips on how to create your own plan:
First, what is It?
A business strategic plan is a concrete plan that identifies your business goals as well as the steps for reaching them. Typically, these plans are comprised of five-year goals, but may even extend to 20-year objectives in some instances. These plans are detailed and specific.
Go Big or Go Home.
When you picture your company’s future, what do you see? Think about where you want it to be in the next five years- or longer. Identify these goals before you set about crafting your business strategic plan as you will need to outline the steps to reaching these very distinctive goals and dreams.
Part of this process also involves identifying your personal goals and what you want your life to look like down the road. Think of both short-term and long-term goals for yourself as a business professional.
Make an Honest Assessment.
Be honest and assess how your company is doing right now. Compile your business plan, mission statement, and any vision boards or objectives together with data like your financial statements; put it together in a folder or file for easy access and safekeeping.
Put it in Writing
The best business strategies are tangible and written down. Make a list of your goals in writing and keep them close by. Outline- and write down- the steps that you will need to make to reach them, and number these steps.
Be as detailed as possible and add details to different goals or objectives as they become clearer or closer. Cover all aspects and areas involved in making your goals happen, from soup to nuts.
Make It Measurable
You will need to measure your progress so make sure to be specific in goal setting with a way of measuring your success. Some indicators that measure your objectives may be increased exposure on social media, more followers, more ‘likes’, and increased online sales, for instance.
Stay on Top of It
Measure and review your progress consistently, every three months to start. This allows you to quickly change or adjust your approach as needed based on the results. Keep up with industry trends and the market you’re involved with to keep your business plan fresh and relevant.
Ready to develop your own business strategic plan to reach your goals? Talk to the tax and accounting professionals atBMH Taxes; they are prepared to discuss the best ways for reaching your goals while maintaining a healthy and prosperous business. Contact us online or Call to consult with an expert today.
When it comes to Tax Planning, being proactive pays. Being vigilant and precise with your tax reporting and expenses can minimize your tax liabilities- and save you money at year’s end. Tax prep and documentation should not be something that only occurs at tax-time; proactive tax planning is something that happens year-round to avoid nasty penalties and maximize deductions.
Some tax planning tips include:
Provide Proof
Prepare to be vigilant about keeping track of business expenses- which can be a bear! A good rule of thumb is that if you plan to deduct an expense, you will need some sort of proof of the purchase, like a receipt, invoice, or canceled check. You can also use bank records, if needed, to document purchases related to business that you do not have an actual receipt for when it comes time to complete or file your taxes and reports.
Document Diligently
Always save invoices or receipts for all your business-related purchases. It helps to write and attach a note explaining the purchase for documenting later, when you may have forgotten the specifics surrounding the expense.
Segregate Accounts
Make sure to keep personal accounts separate from business accounts whenever possible. It can make accurate record-keeping nearly impossible and you could suffer by missing out on certain business deductions this way.
Classify Carefully
Don’t misclassify your workers as the income-tax withholding and employment taxes are quite different. While you do withhold federal income tax and FICA taxes from your employees, you also are responsible for unemployment taxes and your own share of FICA. When you are dealing with staff that are actually independent contractors, you are not required to withhold taxes, making the individual responsible for their own self-employment tax liability. This also eliminates the need to pay separate FICA or unemployment taxes. Talk to your accounting professional to learn more.
Pay Promptly
Pay the employment taxes that you collect from the wages of your employees and staff for federal income tax and FICA (Social Security and Medicare) taxes promptly. The IRS is not tolerant of delayed payment and noncompliance penalties can be severe.
Industry experts offer tax tips for small businesses, including that you need to be careful and cautious when making tax deductions. This may look suspicious and trigger an audit, further reinforcing the need for organized documentation. The IRS frequently assesses business tax deductions, like vehicle use and travel expenses, to ensure you are sticking to their guidelines and limits.
Consider Hiring Help
Take the worry out of your business taxes with some professional help from BMH Accounting. If you own or operate a company or brand, outsourcing your financials and tax reports to a certified accountant makes good business sense. Don’t risk penalties and fines by going it alone; hire a tax professional today.
A small business failure can be surprising in terms of what led to the demise and how it may have been avoided. There are some common errors that many small business owners and entrepreneurs make that lead to problems that cannot be overcome. Subsequently, it is these errors that often lead to the end of the company or business.
Avoid these 5 key mistakes that lead to a small business failure:
Money Issues
Probably the biggest reason for small business failure is money; aim to keep your overhead as low as possible and track all your expenses. Be frugal, even when you don’t need to be and be on the lookout for ways to monetize and further improve your bottom-line. Always have a goal of streamlining your operations in efforts of curbing costs and improving revenues to succeed.
Too Big, Too Fast
Another reason small companies don’t succeed is that they try to take on too much, too fast. Start small, such as a pop-up shop or an event like a festival or fair to learn the market. Some businesses assume there is a market for something only to discover that there simply is not; know the market before investing.
No Back-up Plan
Have you heard the expression, ‘prepare for the worst but hope for the best’? That should be your mantra when it comes to your small business. Always have a back-up plan and anticipate, even expect, things to occasionally go wrong or askew. That is simply part of doing business. Make sure that you are fully covered in areas like insurance, staffing, and that you have a slush fund ready for a rainy day.
Lack of Business or Industry Experience
Are you sure that you fully understand the market that you are taking part in? Surprisingly, many businesses fail due to a lack of understanding of their market. For example, some restauranteurs may not understand the time, commitment, and money that it takes to open a restaurant in a specific area. Many successful companies encourage entrepreneurs to go with what they know.
Underestimate the Undertaking
Speaking of underestimation, make sure that you are well-aware of the effort and time that go into making a business successful. Remember that you will have a wide range of obligations, from marketing and human resources to serving clients and keeping facilities clean. Make sure that you never minimize the work that it will take to make your endeavor a success.
These common issues are not always a result of the business owner making rash or compulsive decisions, but rather may be related to the industry, current market, or other unforeseeable circumstances that impact revenues and force closure.
For help keeping your business matters precise and timely, reach out to BMH Accounting, Don’t let mismanagement be the reason your business fails to thrive and succeed; get the accounting assistance that you need.
A successful business or company leader knows when and what to delegate, and this includes outsourcing payroll and taxation tasks to someone else. Ideally, the leader of the team can put their focus into business operations but payroll is something that simply should be handed-off to a professional accounting firm, company, or site.
Ideally, outsourcing achieves three main goals:
1. Time and Attention
Outsourcing frees up your most important resource: your time. This allows you more availability to focus on your core tasks related to the business. Furthermore, hurrying through chores like payroll can have negative repercussions. While it doesn’t necessarily help improve revenues or your bottom line, failure to maintain a precise payroll can cause big headaches and hassles later.
Payroll takes time and includes efforts to complete taxes, too. Do yourself a favor and outsource your payroll.
2. Technology and Expertise
Don’t let your company be at a disadvantage by not offering employees and staff high-tech options when it comes to payroll. To complete payroll well, you need expertise in areas that include, but are not limited to, direct deposit and self-service access to their payroll info. Employers rely on technology for other perks, such as maintaining employee records and taxation reports. If you want your business to grow, you need to fully-invest in the technology needed to get there. Laws change and are complex; outsourcing payroll provides you with the latest and greatest in terms of technology and expertise that helps your business run smoothly and that satisfies your entire team. Companies and businesses that can’t keep up may be at a significant disadvantage when it comes to hiring and retaining a solid workforce.
3. Reduced Risks
If you lose focus, make mistakes, or fail to complete timely payroll, the risks are great. Outsourcing payroll helps to reduce costs and risks- which may help some managers and supervisors sleep better at night! A great payroll provider offers options and capabilities that you simply may not have independently. Consider some of these options and talk with some reputable payroll providers. See what they have to offer and how their expertise can create a more user-friendly experience for your staff seeking payroll information or your supervisors who are looking to review employee records. Put your time and energy into your core business operations and outsource your payroll today. It simply makes good sense.
Ready to learn more about outsourcing your payroll? Talk to the experts at BMH Accounting; they want to alleviate the many tasks on your plate and free-up your supervisory team for other things. This includes actively managing your staff, launching new products or provisions, and serving your consumer audience. Call to find out how outsourcing payroll can be beneficial and advantageous for your business operations.