Is it time for your small business to streamline your accounts payable? As your company grows, organization becomes more imperative and having a pile of late or unpaid bills can really hurt your cash flow, which can be detrimental for a small business.
If you take the time at the beginning to set up the process the right way, it will pay off in the end (literally). Here are a few steps to get you as a business owner moving in the right direction.
Maintain Accurate Records
You can’t invoice a client if you don’t have the records to show the work your business has done. Use invoice software and digital time sheets to help push you towards daily recording of activities (if relevant), as well as any materials bought/used. If you attempt to remember these things on a monthly basis, you’re bound to miss some, which will add up and ultimately decrease your profit margin.
On another note, it’s estimated that more than 50% of businesses are still using mainly paper to process invoices. Not only does this increase the opportunity for mistakes, it’s wasteful of time and physical materials.
Obviously it’s okay to keep paper copies of things that would be better saved that way, especially for security’s sake – the goals is to find your happy medium between digital and paper.
Invoice Automation – Change Is Good
We all know that change is hard. But to be stuck in the past can be dangerous and costly to the success of your business.
If you’re ready to move into digital, implementing accounting software can be daunting at first, but once you make the transition, it will be worth it. D&M Accounting offers accounting software training for small businesses on various programs to get you started on the right foot.
Mindset Matters
If you’re a newer business owner coming from the employee side, asking for payment is an entirely different ball game than receiving a check or direct deposit every two weeks without thinking.
As the owner you’ll probably have the delightful opportunity to chase payments, and even though you know you’re owed the money, this can be very stressful. But if you did the work, you’re owed what you’re owed. Develop a polite, firm strategy, and after some practice asking for payment will become second nature.
