- Self Education
Self-education is the first thing you do when managing business finances. The way to educate yourself can be by learning how to read financial statements.
For those of you who don’t know, financial statements have four parts, namely:
Cash flow statement
By learning to read financial statements, at least you can conclude the steps to be taken to develop your business.
- Do the Planning
Do General Planning
Planning in general or general needs to be done before you start a business. Prepare the big picture and the initial steps you will take in pioneering MSMEs.
Once the grand plan is made, divide it into several parts. For example, daily, weekly, and monthly plans. In this way, business development becomes more structured.
You also have to be detailed in making plans. Starting from who will do things, the needs needed, and the capital that that must prepare.
- Create a Financial Logbook
Creating a Financial Logbook
What should always record finances in business? Its purpose is to monitor all incoming and outgoing transactions. Record keeping also reduces the risk of improper spending.
No matter how small the scale of a business you run, at least provide a cash book. This cash book is used to record incoming and outgoing money accompanied by evidence.
Financial records are not only limited to cash in and out. You can’t ignore debts and receivables because this concerns the assets or assets of the company that you are starting.
Notes in the financial record book must be made in detail and orderly to be easier to read and understand. Sort by transaction date and time.
What can create financial record books manually? However, this system is considered less effective. In addition, the possibility of calculation errors is even greater if the recording is done manually.
To make it easier to manage financial cash, you can use the BukuWarung application. This application can help you in recording business expenses and income.
In addition, the BukuWarung application is also equipped with a feature to record debts and receivables. Calculations performed by the system are also more accurate than manual calculations.
With the help of this application, you can monitor your operating cash in real-time. You can use this application anywhere.
- Make a Budget Regularly
Make a Budget Regularly
Not only recording finances, making a budget or budgeting is also important in a business. Budgeting aims to limit spending so as not to swell.
It is recommended that you make a regular budget, for example, every month or every week. Separate expenses by a group. Make sure all can meet all the needs in the business.
Making a regular budget can also increase efficiency in a business. This will have a good impact in the long run.
In determining the budget, you should also consider the notes on the cash book. So you can figure out which budget to increase or decrease.
Because they cannot separate this budget from one period to the next or previous period, everything must be sustainable to run smoothly.
- Monitor Financial Cash Flow
Monitor Financial Cash Flow
The next tip for managing small business finances is always to keep an eye on financial cash flow. The purpose of this supervision is to prevent cash leakage.
It is not easy to monitor cash flow because it requires high accuracy. Basic accounting knowledge is also needed so that you can understand good financial cash.
But you don’t need to worry because the BukuWarung application is now available. This can use this application to record books and save your business financial cash data.
The stored data will be processed and produce structured reports. With the help of the BukuWarung application, you don’t need to be confused anymore in monitoring the cash flow of your business finances.
- Turn Cash Flow Faster
Good business financial management is also reflected in how you manage accounts payable well.
Turn your cash flow, and many entrepreneurs have difficulty turning their cash flow. Why is a debt management related to cash flow turnover?
The cash flow cycle will also slow down if the credit sales period is longer than the credit purchase.
Therefore balancing the two is very necessary.
- Use Profits to Grow Your Business
Use Profit to Grow Your Business
A business is said to be successful if you get a large profit. Instead of spending it on personal needs, you should set aside the profit to grow your business.
From every profit earned for one month, set aside at least 10% to business capital. In this way, the business you are starting can continue to grow.
For example, you have a grocery store business. In each month, set aside profits to buy more and more variety of items.
- Separate Personal Money and Business Money
Separate Personal Money and Business Money
No matter how small the business you run, you should separate the money used for business with personal money. The purpose of this separation is to prevent business capital from being used for personal purposes.
The worst thing when you keep combining business money with personal money is that the capital runs out unnoticed. This situation will make your business forced to go out of business.
Use a different place between personal money and business cash. You can separate them into two different wallets. It’s also a good idea to create a separate account specifically for your business.
It would help if you also committed to not using business cash to meet personal needs.
- Prepare an Emergency Fund
Prepare an Emergency Fund
We will never know what will happen to our business in the future. The worst things can happen. For example, natural disasters or revenue continues to decline due to the emergence of competitors.
Things like this can put your business in an insecure position. You need to set up a reserve or emergency fund to anticipate difficult times.
What should prepare this emergency fund from the start before you start a business. You should also use these funds wisely.
Please do not use it in situations that are still under control. If you experience a loss, then these funds can be used.
In normal and stable circumstances, you can assume that this emergency fund is an advantage that you get from the business.
- Monitor Assets, Debt, and Capital
Keep an eye on Assets, Debt and Capital.
Every asset accounts payable and capital must be recorded in a structured manner. Because all of that can affect the sustainability of the business, you run.
Receivables are company assets, and you must record them properly. Otherwise, you may lose company property without realizing it.
Debts you have to partners should also be recorded, although the creditor also has his records. This prevents double payments or claims unilaterally by the creditor.
All goods owned by the company must also be recorded in the inventory log book. Check regularly to make sure the item is not lost.
- Use Professionals
This method can be an option for those of you who cannot handle business financial management. You can hire professionals to manage your business finances.
Try to have experience in this field, because good financial management will impact decisions taken in business development.
- Separate Accounting and Cashier
Giving a cashier’s job desk who doubles as accounting is a big mistake. Cashiers who hold concurrent positions as accountants are likely to be able to manipulate financial statements.
Of course, this will affect the financial condition of your business. Therefore hire accounting and cashier separately.
- Pay Attention to Third Party Contracts
Partners in managing the business are also very important. Many people make the closest people as business partners.
This is very vulnerable to the continuity of your business. Try before working together, pay attention to your contract, try to be black and white. So if at any time there is a breach of contract obligations, it can be evidence for you.