Entering the entrepreneurial waters is exciting, but it’s also one of the most difficult paths to take. For example, did you know that 50% of small businesses fail in their first five years? Even though there are numerous things that may go wrong, stats show that one of the most common causes of their failure is poor money management. While 82% of SMBs experience cash flow problems, 29% of them run out of cash over time.

Luckily, we’re living in the era of sophisticated fintech solutions that can help small business owners manage their cash flow successfully and avoid making catastrophic money mistakes.

So, let’s see what these technologies are and how they can help you.

Cloud-Based Accounting Software Simplifies your Transactions

As a small business owner, you’re the one making critical financial decisions, choosing the right marketing strategies, and deciding how your business will grow in the future. But, are you ready to handle your finances all by yourself? Accounting and bookkeeping are one of the most significant aspects of your job and you need to take them seriously. As hiring an in-house accountant is usually too expensive for your small business, you should consider investing in cloud-based accounting software. Here are a few benefits of these tools:

• Being able to track your business’ finances in real-time, you will stay on top of your data, spot cash flow problems immediately, and take immediate steps to solve them.
• Automated accounting software is built on the omnichannel approach, letting you track your data from multiple devices, irrespective of your location.
• Accounting software centralizes many aspects of your money management under one umbrella and lets you manage them faster and more efficiently.
• Accounting software does critical calculations for you, letting you track your financial health instantly and make solid financial predictions.

Direct Debit Software Solves the Problem of Late Payments

Did you know that late payments are one of the greatest problems small businesses face? According to recent research, 1 in 10 invoices fails to be paid on time, while up to 10% of invoices are never paid. Given these facts, it’s not surprising at all that late payments cost SMBs around $3 trillion globally.  

I believe late and failed payments are one of the greatest financial obstacles for you, too. However, this is a problem that needs to be approached carefully. Otherwise, you may ruin your client relationships and even lose your major clients.

This is where automating rebilling processes shines. Namely, by investing in direct debit solutions, you will be able to manage direct debit payments across multiple platforms. Instead of wasting your precious time collecting late payments every week, you can simply automate this process. Most importantly, such tools can also serve as financial reporting software, notifying you of any potential problems with your customers’ transactions and helping you track your business’ finances from one platform.

Automated billing also makes your customers’ lives much easier. By signing up, they will be able to complete transactions from multiple platforms and choose between multiple currencies. Above all, they will be informed of their unsuccessful payments immediately and be encouraged to resolve the problem easily.

You will Replace Guesswork with Data-Oriented Decisions

One of the most common challenges small businesses face is knowing when to make critical decisions that may have a long-term impact on their company’s growth. Today, making such decisions is much simpler than it was in the past. Now, it would be silly to believe that, twenty years ago, small business owners didn’t form their decisions around their business data, thorough market research, forecasts, and their experience. It’s important to highlight that, back then, complex business analytics tools were the privilege reserved to large corporations only and they required top-notch equipment and whole teams of data analysts.

However, the times have changed. With the availability of data, free online resources, and analytical tools tailored to your business’ needs, making crucial business decisions has never been simpler. Most importantly, the explosion of fast internet connections and SaaS business models is now making such software available to small businesses, too. No matter if you’re running an online shoe store, a restaurant, or a marketing agency, you can combine different tools to track your major KPIs and, as a result, make data-backed decisions.

Online Courses Let You Learn about Money Management

Just because you’ve managed to launch your business and secure the funds for your business doesn’t mean you’re an accounting magician. No matter if you’re hiring a full-stack accountant, outsourcing your money management to an accounting agency, or using cloud-based accounting software, you need to understand how your budget planning works. After all, you’re the one making key business decisions, right?

Now, with the rise of the World Wide Web, you can find numerous amazing online accounting courses for beginners and small businesses. For example, Udemy offers a wide range of such courses, such as Introduction to Small Business Accounting Training Tutorial and Introduction to Finance, Accounting, Modeling and Valuation. There are even numerous free courses you should check out, like Small Business Doer, The Bookkeeping Master, or Alison.

Over to You

Money mistakes always happen. Still, by investing in the right tools, you can minimize these mistakes and prevent them from ruining your business’ growth. Most importantly, you will track your key metrics faster, make better financial predictions, and base your decisions on actual data.

What technologies do you use to boost your money management and avoid making mistakes?

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Writer: David Webb

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