As a small business owner, or the person responsible for business budget and costs, it’s imperative that you know every last detail of the company’s financial ins and outs. That’s even more vital when times are tight. But how much is overlooked and do you really have a handle on all of your expenses?
A business’ budget is separated into expenses and income, and every business from a start-up to an enterprise-level company will have a multitude of payments coming in and going out on a daily basis.
Expenses cover everything from paying your employees, insurance and tax costs to IT costs, marketing, fuel, travel and even rent. As there are so many factors to account for and monitor, business costs can really rack up without appropriate and regular evaluation.
Depending on what you think will work for you, the use of formatted spreadsheets is a simple way to help you automatically calculate your budget. However, if your business is scaling and you think you may need something more comprehensive, accounting software can be priceless. You can seamlessly pull accounting reports clearly detailing all the information you need to know.
Of course, your expenses all have to be accounted for in their own way. Travel is a great example of this as these outgoings will come from a multitude of sources – especially if you have employees regularly travelling up and down the country. Domestic or international travel will be booked via company accounts or on company cards by a number of different people.
You might even have a fleet of vehicles or a group of pool cars with employees regularly claiming mileage. To make this accurate, there are ways you can track business mileage with specific software and gain accurate data reports. This kind of software automatically calculates mileage and costs, saving time for all involved and ensuring outgoing costs are accurate and there are no miscalculations.
Finding a way to concisely filter all your travel expenses into one view will ensure you understand how much you’re spending, decide whether it’s the best use of budget and where you might be able to make adjustments.
This will be the same for all expense categories – once you understand where the bulk of your spending goes, you can make empowered decisions for the benefit of your business. Once you have all the data available and with the right software, you can even forecast more effectively and plan for the future. Smart business planning includes having all the information available to you, knowing where your business costs are going, and if there’s anything you can do to make your finances more efficient.
Implementing tools and accounting software will help to automate the process of monitoring your business costs. Thanks to technological advances of the past decade or so, this sort of analysis is no longer the preserve of big multinationals either – with software suitable for every size of business.
Having a procedure in place to regularly appraise these tools, pull reports and even update budget spreadsheets will ensure you keep on top of all you need to know to make intelligent business decisions.