Are you losing track of your finances as you grow? Don’t panic!
It’s the goal of any startup – fast, sustainable growth. But it’s not without its risks.
One of the most significant is the fact that, as you grow, your finances can very quickly get away from you. While scaling a business is exciting, it needs to be approached with a certain level of trepidation, and a healthy dose of organisation.
If you’re set on growing your business – or you’re well underway in doing so – this post is for you. We’re here to share some quick and simple tips to help you manage the growth of your company, without losing track of your numbers.
3 Quick Tips to Managing Growth
1. Know Your Numbers
When your business is small, it’s often easier to keep key financial information in your head, ready to respond to a challenge or opportunity at a moment’s notice. It might not be up-to-the-minute and accurate, but it’s close enough for you to feel confident and in control.
However, as your business grows, this becomes more difficult. And if it’s growing too quickly, and demand outstrips capacity, you need that accurate and up-to-date information to hand. Otherwise, you run the risk of allocating resource to a low priority part of the business, or expenses can quickly creep up and leave you scrambling.
In short, you need to take those numbers out of your head, and put them in the cloud, where you’ll have a real-time view of the financial performance and well-being of your business.
2. Master Your Cash Flow
A problematic cash flow kills approximately one in four of all small businesses.
Whether you’re forecasting exceptional (and optimistic) growth, or you’ve confused profit with cash on hand, just one bad cash flow mistake can leave you counting the cost.
There will be times as you grow your business where monthly expenses will exceed sales. Many successful businesses have scaled while operating at a loss. But this is only feasible if you have the cash flow to manage this growth.
3. Don’t Grow It Alone
Tracking your finances and cash flow is vitally important to the sustainable growth of your business. Without that information, you run the risk of making a fatal business mistake.
That being said, having the information to hand, and understanding its importance are two different things entirely. And to understand the context of your finances and cash flow, you need to work closely with your accountant.
They’ll be able to review the available data and offer insights that may have alluded you, all while possessing the experience and expertise to help you avoid costly mistakes and pursue responsible, achievable growth.
Take a Step in the Right Direction
Growing your business and guiding it to the next level is incredibly exciting. But it can also be dangerous if you don’t manage it properly.
You need to carefully track your finances, monitor your cash flow, and work closely with your accountant to scale your business operations effectively.
If you need a helping hand, feel free to contact us to speak with one of our team.