Running a business always means keeping up with the payments. That means you have to have the right budget, know which funds you have to work with and what you can use them for.
If you have departments whose managers come to you needing approval for buying assets their employees need, it’s fine to allocate the funds to them, but you need to make sure your overall cash flow is not running dry. There are ways you can keep your spending within the margins of your budget and still grow your business at the same time.
Use Technology to Help You Prioritize Spending
There are a lot of relatively cheap financial tracking systems out there that can let you keep on top of your finances and see where your funds are being used. Many of these systems are on apps, and many of those apps are free. Technology can help you review what you’ve been doing with your cash flow, and then allow you to sit down with others to prioritize spending accordingly. Let your managers know you’re working with them to be able to meet their department needs.
Technology can also help you reduce recurring expenses like utility bills. As smart technology becomes more common, we as business owners really don’t have an excuse for not taking advantage of it. Devices like automatic shutdown sockets and smart thermostats can help you track your utility usage and reduce energy waste. According to Verdant, some companies have cut their energy costs by as much as 75% by using smart technology.
Wait Until After Billing Has Been Completed
Sometimes it’s not just how much you spend, but the timeframe in which you spend it. Sometimes certain seasons have quicker payments than others, and sometimes you can offer customers incentives for paying sooner or signing up for automatic payments.
If you successfully work your spending around your invoice cycles, it can mean more cash to work with.
Keep Business Credit Card Use to a Minimum
Just as with personal credit cards that aren’t used wisely, business credit cards can also rack up spending and add to your bills. It’s good to limit who uses your business credit card.
It might even be worth it to not share your card at all. According to GetDivvy, regardless of how well you plan your monthly budget, sharing your credit card makes business expenses a lot more difficult to monitor and restrict.
If you’re in need of a business credit card because you feel it can meet your spending needs better than a business loan, you need to create a clear policy that specifies what it will be used for and what the spending limit will be.
Usually, it’s best to get your spending and finances under control sooner rather than later. It’s also good not to delay reviewing your finances because the sooner that’s done, the less paperwork you’ll have to dig through later. This is especially true if you know you have tax and property bills to pay. If there are sacrifices that have to be made in spending, don’t be afraid to make them.
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