Managing the funds of a business is perhaps one of the hardest tasks for a business owner. Entrepreneurs could easily drown in a pile of work and stress. The result? Tons of mistakes which could be costing the business its money, lots of money. Ultimately, you will be just surprised that you are already lacking cash! Sure you can find accounting services Singapore firm to help you out, but could it really solve all your problems?
Take time to reflect to ask yourself, “Am I doing things wrong?”. The answer to this question could be a ‘Yes’. If this is the case, then you should take matters seriously. It will determine whether the future of your business will be a boom or a bust. Let’s take a look at some mistakes cash-deficient businesses do always or almost all of the time.
- Careless accounting
One of the worst blunders an owner can make is to rely on inaccurate records. Reports are there to guide us monitor businesses, but where do you think the company will go if the guide itself is faulty? Have time analyzing every aspect of your bookkeeping services/accounting process, and improve ineffective systems through strict internal controls. For a more effective review of your business, there’s a lot of accounting services in Singapore which could help you out. You may also use some accounting software for a more seamless accounting flow for your business.
- Wonky resource allocation
Another major concern for owners should be financial planning. Your shortages might be caused by plans that are not thoroughly made. As an advice, create a two-tiered plan – one which is an annual budget, while the other is presented month by month. Should you need to create adjustments on a particular month, be sure to effect the changes on the annual budget as well.
- Impulse buys
Impulse buys usually happen when the owner is so much enticed by a friend’s suggestion or by a good advertisement. This habit will get you nowhere but bankruptcy. Have a plan and stick with it. If it is a big purchase and it is not in your budget, better get it off your head right now. You can plan on buying it the next year if you really want it. Also, be careful about using funds tagged as “miscellaneous” or “others”, it should just be used for IMPORTANT things which are trivial in amount.
- Under quoting to clients
Your business might have a tough competition, but it’s not enough reason to price your goods or services too low. Create an analysis of your costs in order to determine the best price in which you’ll have a pretty good margin, at the same time still be competitive in the market. Find out what’s the best practices used in your industry to further lower your costs, and ultimately, your price.