Owning a small business can certainly be a fulfilling experience. Creating a viable entity being your own boss and producing something of worth for your community you have numerous opportunities to make your small business a worthwhile and productive endeavour. Perhaps though one of the more complex avenues for smaller businesses to navigate is financial planning. Saving money and finding ways to stretch your dollar for all its worth is essential especially when you’re operating on a smaller scale and consequently a smaller budget. Here are five tips and strategies for maximizing your budget and establishing a solid financial plan for your small business.
1. Deduct Whatever Possible
You would be surprised at how many small business owners don’t realize the extent of what they can deduct from their taxes. To this end saving your receipts is crucial —all of your receipts. You need to be able to validate what you spent and why. In conjunction with this keeping thorough records is absolutely essential when it comes to figuring out your tax deductions.
So what kinds of things can you purchase and subsequently deduct? Office equipment for one such as computers devices and even the basics such as paper and pens. These are all for your business use and thus all deductible.
It’s not only the tangibles however that can be deducted. For instance, many don’t realize that their commercial insurance premiums are also tax-deductible. So whether yours is a home-based business or one that operates out of an office you need to take into account all of the relevant insurance policies and fees that pertain to your company needs and then talk to someone who understands the ins and outs of tax rules and regulations to help you with appropriate deductions.
2. Create a Budget Know Your Budget and Constantly Revisit Your Budget
Your budget is at the core of what you do and how you operate your small business. Creating a comprehensive budgetary plan is going to benefit you financially in the long run. However, it is not enough to just create a budget you need to follow it. And of course, as sales and expenses consistently fluctuate you’re going to need to revisit this budget when necessary and adjust accordingly.
Consider your budget the heart of your financial planning strategy. If the heart isn’t healthy the entire body suffers as a result. The same can be said of your small business. If the budget isn’t relevant if it doesn’t make sense for your company and if it is just plain neglected odds are the business is going to suffer.
3. Look into Apps!
Nowadays there’s an app for just about everything. From invoice creation apps to credit card payment apps to receipt collection apps your small business should be able to find just about everything, it needs to run smoothly and stay on task given the wonderful world of apps.
Financial planning in terms of your small business has actually never been easier thanks to some truly life-saving applications. For example, InDinero is a great budgeting app that happens to be incredibly easy to use. Meant to pull together all relevant credit card and banking information regarding what you spend and how you spend it this app not only gives you a snapshot of your financial picture but also can perform analyses and forecasts.
4. Financing Options
Increasingly banks are getting more and more restrictive when it comes to small business loans and being aware of your options in terms of various financing platforms is a must. Often as a small business owner, you have to get creative. Selling property or some other form of equity product that you own may be necessary. Loans from family friends or other such investors are also an alternative.
Actively pitching to and landing investors is always a good way to raise capital for different projects. The point is that in your financial planning for your small business endeavour you need to be aware of the options and subsequent limitations when it comes to procuring funds for larger projects startup costs or even day-to-day operational expenses.
5. Bring Your Own Device
More and more companies are implementing a BYOD policy. Rather than purchase smartphones tablets or laptops for employees businesses especially small businesses are finding they’re able to cut costs significantly by following this BYOD trend. Not to mention employees are generally more comfortable working on their own devices rather than company-owned ones that consequently may be more outdated anyway. Especially for startups and companies who don’t have numerous employees, BYOD may be a manageable option that can certainly help cut overall costs. Keep in mind however that there are security considerations to this BYOD approach. Your employees might have vital client data on their devices so you will want to take measures to ensure privacy protection. It’s important to understand that your business will still have to comply with privacy laws and regulations regardless of whether you’re using company equipment or employees’ personal equipment. Therefore you will need to have security and encryption measures in place.
Financial planning for small business owners can be tough but you’re not alone. If you’re not familiar with certain areas it never hurts to talk to a professional. It is important to talk to a broker who is experienced when it comes to consulting with small or start-up businesses on commercial insurance policy needs and who can help steer you in a direction that makes solid financial sense for your company. Not all insurance policies are created equal and you need the best policy that protects you while maintaining affordability.