3 hacks to simplify managing your business finances

Transcript

If you run a business, you are in the business of profit. And whether you like numbers or not, if you intend to run a profitable business, which is the reason you get started in business, you need to stay across your business finances. Now. I’m an Accountant by trade, so I love numbers, but I get that you might not. But in today’s episode of The Clare Wood Podcast, I’m going to share with you 3 hacks to simplify managing your business finances.

I’m a qualified accountant by trade. I am a Certified Practicing Accountant or a CPA, so I love numbers. I love to look at my business finances and I love to support my clients with their business numbers as well, however, I get that not everyone is built like me and that a lot. Of people, perhaps yourself included, feel really overwhelmed about where to get started with profit loss, budgeting, cash flow, taxes, all of the things. So, what I want to do is share with you some hacks to simplify managing your business finances – these are things that you can go and put into place to make the whole process a lot easier.

Set regular money meetings

Hack number one, set yourself regular money meetings. If you follow me on Instagram, you will have seen me having my regular money meetings. If you don’t follow me on. Instagram why not? Go and follow me now I’m @clare_wood_coach and I share a lot over on Instagram. I have money meetings in lots of different areas. I also have them in the area of my personal finance, but for today, I’m gonna hone in on the business finance money meetings. Every single week I have a 15 minute meeting with my bookkeeper. That’s it. Over 15 minutes a week you can be across your business finances. I sit down with my bookkeeper and we have a look at my cash flow, we also check in and make sure that I have enough in my tax savings account and a few other bits and pieces.

If you’ve done my course, The Profit Academy Foundations, you will know I go through the entire framework of exactly what we cover in those meetings. But for now? I want you if you don’t already, to go into your calendar and set some time aside regularly to sit down and look at your business finances. As I said, I do this every single week for 15 minutes, and I also do a monthly meeting, which is a bit longer. Maybe for you at the moment that seems a little bit too much or too overwhelming, but what I what I want to do today is empower you to set some sort of meeting in place, even if at this stage it’s just once a month. Do you know what? If you’re not sitting down and looking at your money at all once a month is better than before. And then you can increase the frequency over time.

What is the benefit of having regular money meetings? The process of having regular money meetings is to make you feel empowered with your business finances. If you are someone that doesn’t love spreadsheets, that doesn’t love accounting that gets overwhelmed by all. Ignoring the problem is not going to make it go away. OK. It’s too much. I’ll just pretend it’s not happening. That actually will make the problem worse, because you might end up with a tax debt or you might end up with payments that are really outstanding. And instead of it being something simple to rectify, it becomes a much bigger problem. I really encourage you to go into your calendar and set the time aside. A little tip that I have, even though I’m a bit of a numbers nerd, my husband’s not so much, so think of a way that you can make these money meetings fun. My hubby has his favourite coffee shop that he loves to go to, so we often will have our money meetings at his favourite coffee shop. I’ve even had one with him at the pub, so he was sitting having a beer while we spoke about business finance. What’s a way that you can make this process fun for you?

Set yourself up with the right systems

Hack #2 and this kind of follows on from the money meanings, which is set yourself up with the right systems. The reason why people fail in staying across, be it their business, finances or any other area, is they don’t have a process or a system in place. So set yourself up for success by having systems in place.

The reason I don’t end up with a big, unexpected tax bill is because I have a process in place to put money aside regularly in my business. I’ve got a separate account which the money goes in there and there’s never any tax surprise! Or how am I going to come up with this money. The process is in place and the process works.

Also make sure that you have an accounting system. Now I know this is a bit of a bugbear for people, particularly in the early stages of business. And I’m not saying that right from the outset. You do have to have an accounting programme in place necessarily. However, if it was me, I absolutely would. There’s so much power in having a great accounting system that you can go and run reports that you can check how your business is progressing. I’m not at all affiliated, but my favourite accounting programme at the time of recording is Xero. I know it’s not the cheapest platform out there. Like I said, this is not sponsored or anything but from my many, many years of working in accounting and in small business it is my favourite platform for me personally to use, so get yourself the systems, the accounting programmes, whatever it is that you need to support yourself to succeed.

Another thing that I have is my full proof spreadsheet that I use. I have created these spreadsheets and I teach you how to use them, inside my course that I mentioned earlier, The Profit Academy Foundations. Inside, I share these actual spreadsheets with my students, to make sure that you’ve got tools that help you to make decisions that help you to have visibility over what the heck is going on inside your business. If you don’t have systems, if you don’t have visibility, of course you’re going to feel overwhelmed and intimidated when it comes to looking at your business finances. So set yourself up for success.

Another example of a really cool tool… you can think I’m such a dork, but if you’re sticking around here, you’ve probably already figured that out… I have a tool called an ROI calculator or a Return On Investment Calculator. Again, it’s something that I’ve created and I use it when I’m making decisions in my business. So, for example, if I’m looking at hosting a live event or a retreat, I will go and plug the numbers into this spreadsheet and check hey, is this investment? Is it going to be profitable? How much money am I expecting to make off the back of this investment decision? Just another tool and another system to support me to make smart decisions when it comes to money in my business.

So, question for you, I want you to take a moment now, have a bit of a think. Do you feel like the systems and processes that you have in place currently are set up to support you to succeed when it comes to managing your business finances? If not, let this be a little prompt to nudge you gently in the right direction of getting those things in place.

Setup your dream team

The final hack that I want to share with you today, to simplify managing your business finances is to make sure that you have your finance dream team. Now, it’s not surprising that business owners get overwhelmed when it comes to managing business finances, particularly if you don’t come from an accounting background like I do, and this, my friend, is why you need to ensure you are surrounded by people with expertise in this area. There are a number of different people that you may need in your finance dream team and different people play a different role.

Even though I am a qualified accountant by trade, I am not practising as an accountant now. So a few times people have asked me, can you be my accountant? I no longer practice as an accountant. I’ve actually hired my own accountant and I am certainly never been an expert in the space of tax. I’m not up to date on the tax legislation, so I need to get expert advice to support me in that era of my business. And you do too.

Who are the various people that you might need to support you in your business finances? Some examples are an accountant as I spoke about and possibly a tax advisor. They may or may not be the same person. You might also need a bookkeeper, someone to actually go and support you in processing the transactions or your payroll. You might also want to have a business coach. Again, for me this has been a critical role for me in my own business growth journey. Having someone on the outside. Not necessarily an expert in managing business finances, but someone who is an expert in helping you to grow your revenue or sales because that is a big component of your business profitability. Are you working with someone to keep you motivated, keep you on track, give you ideas around how to drive new sales in your business? You might also need other roles and I go a lot deeper in this inside my course, but an example of this might be a financial planner. Maybe you need someone in the space of your personal finances to give you advice around how to best structure your business to support your personal wealth creation and growth. Who you need in your finance dream team will change at different stages of your business journey. But for now what I want you to do is really think about am I supported by my finance dream team? Can you go and do an audit of the people who are supporting you to succeed in business right now? Can you do an audit of your finance team? Go through anyone that helps you with your business, with your money and see if they are your soul mate fit for this stage to support you to grow to that next level.

I really want to support you to grow your most successful, profitable business so go and get your financial ducks in a row.

If you are enjoying these tips, if you are enjoying this episode about business finance, make sure you come on over on your Instagram and join my broadcast channel. It’s free and I pop in there all the time with little tips and hacks like this to support you. Come connect with me on Instagram. As I mentioned earlier, I’m @clare_wood_coach and also join my broadcast channel called Money Talk where I share a lot more tips on the regular.

It’s really imperative, as the CEO of your business, as the owner of your business, that you are across your business finances. No one else is accountable but you and the whole reason you got started in business is to create more profit, more freedom in your life, so make sure that you do invest the time in this space to become an expert manager of your business and finances

Thanks so much for tuning in today’s episode of The Clare Wood Podcast. If you enjoyed this one and think your audience will also connect with it, and benefit from it, please, go make sure you share it with them. And don’t forget to tag me so I can come on over and say a big thank you. I genuinely appreciate you tuning in and listening to the podcast. I’ll chat to you again next week.