Here’s an all-too-common scenario: a relatively successful service provider is working hard to expand their market. They work a lot of hours, and they have decent hourly rate. However, their cash flow is awful
Why? For what?
Because they work so hard that it’s impossible to find the time to actually take control of their finances. Invoices are not sent in due time. Past balances in due are dismissed. Taxes are not completed. And perhaps worst of all, they have hundreds of regular checks that go out automatically every month, even though they have no idea what they are, or whether they even use the programs they pay for.
Sound familiar to you? Unfortunately, a lot of successful companies look almost exactly like that. If you work at home, and you are accountable to no one but yourself, letting these little things slip is far too easy, until they have a profound effect on your business like a tsunami.
The fact of the matter is, when you take the time to put some trustworthy and reliable systems in place, it is easy to clean up.
Begin your invoicing process. Sign up for (and use) a program such as Xero or Quickbooks which will simplify your timekeeping and produce a one-click invoice. And put your invoicing day as an unbreakable rendezvous on your calendar.
Log in to your timekeeping program, start generating your invoices and press Send. You are going to have it done in a jiffy. Not only that, but most billing systems issue follow-up notices automatically for unpaid invoices so you don’t have to think about monitoring those late payments.
Expenses process. Use a single system, that includes expenses. That might be Xero or any of the accounting programs for your business. Whatever it is, be sure it has a reporting feature which will allow you to send your accountant monthly statements. With xero you can send your sales report and reconciled statements straight to your accountant with on click, at the end of each month. As tax time rolls around, while everyone else scrambles to find paperwork and upgrade their accounting system, you will be sitting back with your feet up.
If you’re doing your own taxes (kudos to you!) then look for platforms that are compatible with each other For example, you can download a bank statement file from Xero right at the end of each month for super-fast reconciliation. That alone saves you hours to “do the accounts.”
Simply putting these two basic systems in place will potentially save you 10 + hours a month, but the bigger advantage is that you’ll get the money work done. And what that will do is invaluable for your cash flow.
“Timing is everything in business. Of which in this case – there’s no time to lose”
