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Category Archives: Finance

6 Steps To Improve Your Finance Functions

Your finance functions those functions in your business that look after your finances. They include all your book-keeping and record-keeping as well as sales and buying functions. Often small businesses leave everything to one person - a book-keeper, or perhaps the business owner "keeping the books" after hours. Yet, efficient finance functions save you money and provide all the early warning information that could move your business from also-ran to successful. Here are 7 ways to improve the performance of your finance functions. 1. Set a goal Set a goal of what you want to achieve. What do you want to be done and when by? What reports do you want to be produced and how often? Which parts need improvement and by how much? There is no point in starting to improve your finance functions without knowing what you want to do. 2. Look at all your finance functions Don't just restrict your reviews to one part. Keep an open mind and look at all finance functions to see what can be improved. For example, if you restricted your review of improvements to debtor collection, you might miss the fact that customers are paying late because the customer sign on process doesn't effectively discuss payment terms. 3. Take the...
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10 Things Every Small Business Needs To Do To Succeed

As a business advisor and accountant, I am often asked what a small business needs to do in order to succeed. It's a simple enough question but there are so many things small business owners need to know, need to be, and need to do in their businesses. So I asked a number of my most successful clients what they thought about the question, and, using my own experience gained over the last 30-plus years, I have collated the top 10 things that a small business needs to do to succeed. 1. Make sure that you are marketing effectively. From experience, I cannot stress enough how important marketing is to the success of any small business. The problem is that most small business owners are subject matter experts - they are good mechanics, good lawyers, good accountants, good toy retailers, good garment manufacturers - and this means that they try to make their business succeed by being good at what they do. Unfortunately, that is not enough. A business succeeds only if it finds and continues to find customers. Some of these will come from word-of-mouth or reputation but the volume of these new customers will not be enough to grow your business. So, you...
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Setting Up Your Accounting System

While our focus is on advice to you after the accounts are prepared - on issues like your future-proof strategies, how to grow sales, making your business efficient - nevertheless we base our advisory work on numbers. So naturally we care very much how you set up your accounting systems. Whether your software or manual system, and your system around it is appropriate for you, whether the information is accurate (garbage in - garbage out), whether it is secure, whether it is efficient - all these details affect what our ongoing advice might be. Whether you are thinking of starting your first or new business, or whether you are dissatisfied with how you "keep your books" at the moment, it is important to set up your accounting system correctly. In order to help you we have prepared an extensive, free checklist on setting up your accounting system. (more…)...
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When do you start making profits?

One of the key pieces of information for any business is - what is your break-even point? This is the point of sales volume or revenue, that is required to cover all your costs, being both fixed costs as well as variable costs. At this break-even point your total profit is nil. Before you reach that break even point, you will be making losses. After that break even point, you will be making profits. In order to generate sales, you have to incur costs. You need to know how much you must sell in order to break-even. You can get our free break-even point calculator here. It is an Excel spreadsheet that you can use to calculate your break-even point. So, how do you calculate your break-even point? (more…)...
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