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Top Tips 08: Some finance tips when running a business…

Some Finance Tips when running a business...

As part of Fistral's 21st anniversary year, we've asked the Directors to share their thoughts and experiences on a variety of business-related issues. In the eight of the series, we asked what finances advice they had when running a business or SME. Below they give ten recommendations.

For the latest article in our 21st anniversary Top Tips series we asked our Directors:

"What financial tips would you give to an SME or new business?"

10 finance things to do when running your own business are:

  1. Maintain Low Outgoings - Don't spend what you don't have unless you are guaranteed a (quick) return.
  2. Have Low or No Borrowing from the Bank - You get nothing for nothing, be careful what you risk or put on the line...
  3. Make a Reasonable Profit but Always Give Good Customers Value - Think of it as a partnership between the customer and yourself: you both need each other. Make what you need but not at the customers' expense or compromising on quality products or services.
  4. Get a Good Bookkeeper - Someone who will keep the books up to date, nag you into getting invoices out and signing VAT forms. This is probably the best advice ever!! (Just don't pinch ours!)
  5. Get a Good Accountant - Unless you are an expert (and have the time!) it's worth the expense to employ someone who knows what they're doing. And make sure they're trust worthy.
  6. Be Open and Honest - Especially regarding expenses etc.
  7. Always Pay Taxes - In full, and on time. Seeing cash go out always hurts, but try to think positively: at least you have an income stream, and at a level that means that something (hopefully the majority) is left in the bank.
  8. Pay Employee Salaries, Invoices and Expenses First - As a boss you are always the last to get paid, so get used to it from the start.
  9. Have a Good Forecasting Model - Either buy one or make one yourself (Excel will do); something that will allow you to plan in the short-, medium- and long-term. And remember to include NI, pension contributions etc.
  10. And Finally, especially when starting out, Make Sure You Know Where Every Penny is Going - If you don't, who will? And how can you trust any financial advice you're being given (garbage in = garbage out)...

Posted by Pauline on 08/26 at 04:50 PM in Fistral Tips

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