Effective financial management is a crucial factor for the development of any enterprise. This includes planning, organizing, controlling, and monitoring financial resources to ultimately achieve the business’s business goals.
Sound financial management helps businesses effectively use resources to promote growth, create competitive advantages, and above all, towards long-term sustainable stability.
CEOs need to master financial management knowledge and skills during challenging times. At first, everyone hears that this is a formidable job, and everything revolves around reports, data, and complicated statistical functions (Despite the harsh truth).
However, from a more clear perspective, financial management is the efficient coordination, distribution, and use of a company’s cash flow.
Now, things just got easier for business owners to start managing the company’s finance with these 11 practical tips.
11 tips to help CEOs quickly manage business finances
Have a clear business plan
The business plan defines the business’s goals in the short term and for many years to come. It should detail how you will use your capital and how your cash flow will work.
This will make it easier for you to figure out the exact number and appropriate funding for each stage of operation and development.
Regularly monitor your financial health
The everyday work of CEOs when they wake up is constantly monitoring the progress of their business activities. This gives you an insight into how much money you have in the bank, your current sales, and your inventory.
At the same time, this also helps you easily re-evaluate the goals set out in the monthly business plan, thereby finding the most suitable strategy to optimize the cash flow.
Ensure timely payment from customers
Businesses can be in big trouble if customers pay late. To reduce the risk of late or non-payment, you should make the terms and conditions clear from the outset.
It will help if you also issue invoices quickly. Apply advanced order and debt management solutions, thereby contributing to optimizing the process and, at the same time, saving businesses a lot of time and effort while ensuring the money stream is stable.
Know your spending and always have cash ready
Cash is almost the lifeblood of businesses. Even large corporations with steadily growing profits can still be in big trouble if they don’t have enough cash to cover day-to-day expenses such as rent and salaries for staff.
You should know the minimum your business needs to survive and make sure it doesn’t fall below the minimum.
Always keep a close eye on all kinds of accounting documents
CEOs should continually closely monitor and update the status of accounting documents to avoid the risk of losing money due to failure to keep up with late payments of late customers to suppliers – partners mine.
Using a sound record-keeping system will help you keep track of your expenses, debts, and creditors so that you can coordinate cash flow most efficiently.
Pay taxes on time
Failure to meet tax return filing deadlines and payments may result in penalties and additional penalty interest.
These are unnecessary costs that can be avoided with a clear plan and careful preparation. Keeping accurate records saves your business time and money and prevents your business be blocklisted by Government Agencies.
Managing and optimizing costs right from the operation stage
Control operating costs from the starting stage, such as cutting office electric bills in the office. Other tactics can be using everything efficiently, from office equipment to air conditioning, even employee overtime.
Continually monitor and check inventory to balance input-output of goods and maintain a healthy cash flow. Try out new advanced stock management technologies to keep your cash flow steady and keep the right amount of inventory.
Find the right business loan.
You must choose a loan source that is suitable for the purpose, model, and size of your business. Typically, smaller companies rely more heavily on overdrafts and personal relationships, but this is not necessarily the best way to get funded.
Get a free estimate for funds to grow your business.
Jenfi offers business owners a new solution to resolve this headache, with a streamlined procedure and fast disbursement time. In addition, the solution packages are also designed for each separate business model, meeting the capital source to solve the immediate financial needs of the business.