5 Effective Tips to Be on Top of Your Business Finances

Many businesses have taken a hit because of the COVID-19 pandemic, forcing some shops to close down for a time and resulting in lost earnings for the company. Almost a year into the global health crisis and businesses are slowly opening up their operations again.

Now that you're trying to get your business back into operations, it's crucial to find the right financial support to ensure that you become profitable again. This means you need to be efficient in all your business activities, from procurement to project management and accounting, because they involve spending or saving money.

Here are concrete ways to help you stay on track with your business finances.

1.     Purchase a good cloud ERP solution

Cloud-based enterprise resource planning (ERP) software solutions come in various types depending on your industry, but they all come with core functionalities like financial management. It's then up to you to discuss with your provider the specific applications that you need to run your day-to-day operations using the ERP software.

 

For example, the COVID-19 pandemic necessitates stricter health and safety standards for businesses across industries. If your business involves supplying medical devices to clinics, hospitals, and similar institutions, the partner you choose for your cloud ERP solution must be a manufacturing specialist, as well.

 

Your provider must be a company that knows the importance of having the best tools to monitor and manage the various aspects of a medical-related business, such as design, manufacturing, distribution, maintenance, and service, to enable you to deliver quality products to your customers.

Needless to say, when customers are satisfied with your product or service, your relationship with them flourishes, so much so that your finances will have significant improvements.

2.     Resist the urge to mix business with personal finances

No matter how challenging your current business situation is, you should try to avoid mixing your business and personal finances at all costs. This approach can save you from the difficulty of doing the math when it's time to make your weekly or monthly financial reports.

 

You want to see immediately if your business is starting to pick up again, and the way to do it is to have a dedicated bank account for it. Having separate accounts for your personal and business finances also allow you to sort your transactions for tax purposes.  

3.     Be ready to adapt to new technologies

Technology is everywhere, and consumers are willing to try them out because they're innovative and convenient to use. In the same manner, you should adapt to the situation by introducing new technologies into your system.

For example, the rise of digital currency should make you consider accepting cryptocurrency money as a mode of payment for customers who are trying to purchase using their digital assets. Not offering this option may discourage some from initiating transactions with your firm and bring their business somewhere else.

 

On the contrary, leveraging FinTech solutions like crypto puts your company in the league of forward-thinking businesses, which can make your brand more marketable, as well.

4.     Ensure timely payment from customers

Late customer payments can be a major setback for your business in these critical times. You simply can't afford to have most of your money flowing out and not be sure as to when you'll get paid back by buyers or customers.

 

With that said, you can avoid running into this kind of problem by being upfront about your expectations with your customers. Lay down your company's payment terms and conditions on your invoices and contracts in a clear manner.

 

Have someone monitor customers' accounts regularly or outsource financial services, and issue payment reminders ahead of time to also help your clients plan their payment schedule. You can even reward customers who pay on time by giving them credit for future transactions.

5.     Aim for business growth

To rise above the challenges brought about by the pandemic, several companies had to look for new business opportunities. They surveyed the current market and reinvented themselves to be more responsive to the evolving needs of customers.

As a business owner, you need to develop this same kind of mindset. Perhaps your business model or strategy needs some adjustment so that you can become more competitive.

 

Be sure to focus on creating value by giving what customers need and want. Study the industry trends, assess your chance for success, and plan your strategy. Investing your time and company resources in these things may be worthwhile in growing your business.

See Your Business Finances Soar

Global economies are still trying to reel from the negative consequences of the pandemic. Indeed, these are challenging times that pose some financial struggles for your business. But you can turn things around and even come out on top of your game. You only need to have the right attitude, plan, and tools to improve and maintain your business finances moving forward.