How diligently do you maintain your shop’s financial records? Are bills, receipts, invoices and bank statements scattered throughout your office? Do you have a system? Is it working for you?
If not, now is the perfect time to get a better grip on your financial record keeping, according to Nicole Fende, who covered this topic in a recent Small Business Trends article.
“Failing to keep good financial records is like driving a sports car at top speed with your eyes closed,” Fende wrote. “It may be ok for a little while, but eventually you will crash and burn.”
To help prevent your shop from meeting such a terrible fate, Fende offered these five suggestions for keeping better financial records.
1. Make Friends With Technology. “There are cost effective ways to make collecting and recording your business expenses easy,” wrote Fende, who shared that she uses the program Shoeboxed (http://www.shoeboxed.com/) to track expenses.
2. Call In Reinforcements. “Technology alone may not be enough to conquer your accounting needs this year,” Fende wrote. “A great solution that is easy on the budget is a bookkeeper. Shop around for a reputable one who will strive to stay within your budget and provide regular reporting on key metrics.”
3. Visual Reminders to Open Your Eyes. “Select a picture or graphic that reminds you of the consequences if you fail to follow through,” Fende wrote. “Then select a graphic that depicts the benefits of success…Put these on a page, print it, out and hang it on your wall.”
4. Make Falling Off the Wagon Hurt. “Every month you fail to keep your commitment do the following. Get a one dollar bill from your wallet and say out loud, ‘I’m simply throwing money away.’ Then tear up that bill and throw away the pieces,” Fende wrote. “Need a bit more drama? Burn it instead. -¦ By not tracking your financials you are actually throwing away far more money than you destroy in this exercise.”
5. Be Publicly Accountable. “Declare your bookkeeping intentions,” Fende wrote. “Not just to your Mom, your golf buddy or your dog. Declare it on your blog, this blog, or some other painstakingly public forum. In your public declaration include a commitment to provide monthly or quarterly updates on your progress. Failure to post an update will cause people to assume that you didn’t follow through.”
To read the complete Small Business Trends article, click here.