Financial management is a cornerstone for any business. Because we can administer and manage resources in order to ensure that will be sufficient to cover the costs and that the company will continue to operate as cost-effectively as possible. In this way, good management can be the trigger for success for your SME.
However, managing the financial management of a company is not easy, and it is usually even more complicated for the self-employed and SMEs, who often outsource the company’s accounting. The problem is that financial management falls on the employer. Planning, financing, cost structure, liquidity, treasury, etc … Everything counts when managing and administering the finances of your business.
So if you want to have your finances under control, take note of these 5 tips that will help you improve the financial management of your company and ensure its sustainability.
1. Check your financial levels
It is important that you are aware at all times of what is happening in your company and what its financial situation is. For this, it is essential that you periodically review the cash flow, to know if there is enough income, if it is necessary to reduce expenses or if there are arrears in payments.
Remember that keeping track of the state of your company’s treasury will allow you to anticipate problems and estimate financial needs well in advance.
2. Adjust external financing to the needs of your project
Finding the balance in financial management is essential. Don’t be afraid to seek financing. The key is to know how to detect the real needs of the company.
Also, analyze the capacity of your company to generate liquidity and profits with which you can meet the fees and interests. Keep in mind that profit is just an accounting concept. You can have a profit and not have the cash flow to meet the expenses of the company.
3. Manage collections and payments
Good financial management also involves knowing how to adjust the collection and payment times. It is important that you plan the treasury of your business well, in order to make a forecast of the inflows and outflows of money. This will allow you to anticipate situations of lack of liquidity.
In case your income depends on few but large clients, it is important to have a plan B. Remember that most of your treasury will depend on these clients and a delay can cause a significant imbalance in the company’s accounts. Remember that you should try to adjust the collection and payment times in the best possible way.
4. Use good management software
A frequent mistake in the management of companies is the lack of a program. That allows you to simplify all the management of your business and boost the results in a simple, safe, and effective way.
Remember that the financial management of your company involves keeping all the accounting and billing tasks under control. One of the great advantages of Jasmin is online management software, it does not need any installation and allows access at any time and from anywhere.
Jasmin will make it easier for you to control billing and accounting, complying with all your tax obligations. It will allow you to control your inventory, manage your expenses, manage your treasury and predict results. Monitoring the evolution of your company has never been easier than now!
5. Analyze results
The analysis of results is essential to evaluate the business situation, and thus plan and optimize your strategic plan. A good way to keep this control up to date is through reports that record all monthly charges and expenses.
Another advantage of Jasmin is that monthly financial reports are generated automatically. This will allow you to save time and energy. And to know where your company is at all times, thus guaranteeing its profitability and good financial health.
Just knowing your income and knowing where it comes from, will you be aware of your spending capacity. This is the only way to guarantee payment to your workers and suppliers.
Tags: 5 keys to improve the financial management of your country, financial management