Your customers seem happy, but your business hasn’t hit its stride. You’re getting by, but business is not moving forward. Why?
The solution seems too simple. But—
Good Bookkeeping Grows Your Business.
To be accurate, good bookkeeping enables you to grow your business. Here’s how.
Financial Analysis & Decision Making
You probably know if your business is making money or not. You know this even if you are just winging it with your bookkeeping. But how is your business doing compared to this same time last month or last year?
Overall Company Performance
Are your strategies working? Is it time to pivot? Should you double down on your current strategies? How can you answer these questions without accurate, up-to-date records?
Performance of Specific Products
Which of your products has been most impacted by the recent increase in costs? What is your new Profit Margin and your new Return On Investment for each of your products in our current market environment?
Evaluation of Customers & Vendors
Which of your vendors are the most timely with your orders? How do you know which ones fill your orders with the fewest mistakes? Are certain customers always late with their payments while others pay you promptly?
Good bookkeeping will help you know which vendors you want to grow with and which customers you want to focus on.
Attracting Investors & Loans
Good records will also give you confidence as you pitch your business to prospective investors or lenders.
And confidence sells.
If you’re looking for money to expand your business, you need good bookkeeping. Investors and Lenders will want to see your records as well as your forecasts before they give you any money.
Demonstrates Financial Stability
Good bookkeeping allows lenders and investors to take a deep dive into your company. Sloppy records could make them dismiss you and your company without a second thought. Good records show that you are taking the time to manage finances responsibly. It shows that you mean business.
Helps Secure Better Terms
Proper bookkeeping may help secure a higher price from investors or a better rate from lenders. Both of these mean a better chance of success for your business. A lower interest rate on your loan can make a big difference in the long run. Don’t leave money on the table.
At the critical moment for action, don’t miss out on an infusion of funds because your bookkeeping sucks.
It Will Free Your Time to Focus On Growth
I’m not gonna pretend that bookkeeping is overly difficult. Your business is probably much more challenging. But bookkeeping does take time.
Playing catchup in bookkeeping takes way more time than timely bookkeeping. Fixing errors made a few months ago takes time. Your time is valuable.
Whether you outsource your bookkeeping or not, when bookkeeping is done well you have more time.
More Clients
That time could be spent prospecting or marketing for new clients. You can use that time to develop deeper client relationships and identify additional client needs. Spend more time taking care of your most important clients.
Time For Effective Planning
All business owners need time for the birds eye view from 10,000 feet. You need time to envision your business’s growth, not waste time on each transaction.
More Family Time
This article is mainly focused on using good bookkeeping to help grow your business. But that time could also be used in your personal life. Maybe that time could be spent in more family dinners, attending more little league ball games or music recitals.
More Time For Your Hobbies
Likewise, the time could be spent fishing, playing guitar, or whatever else you’re into.
Bottom Line
Good Bookkeeping grows your business because you are better able to be strategic. Your business becomes more attractive to outside funds. And you have more time to do the activities that grow your business.