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4 Money Management Tips: Think Small, Save Big

The implementation of a few simple money management tips can have a positive impact on your business in the long run. Here are 4 Useful Money Management Tips.

Analyzing long-term trends, cash flow, and cost and earnings projections are key to effective money management for any business. But for businesses looking to move to profitability more quickly, the development and implementation of a few simple money management tips can have a positive impact on the bottom line.
 

Think Small

Little expenses can add up over time and potentially slow business growth. It's important to review business spending regularly – daily, monthly, quarterly – to identify areas of business operational expenses that can be reduced.

 
For example, check and compare shipping prices and negotiate the best terms possible. Saving a few pennies on each order can contribute big money over time.
 
Need furniture for a new satellite office? It can be a big expense, but if you think small, you can save. Check out local sites for used office furniture and equipment in your area, and set up that new office for a fraction of the cost of buying new.
 
Of course it's equally as important to look at larger business operational expense categories: salaries, employee insurance costs, taxes, equipment costs, and other large expense categories. In doing so, look for opportunities to reduce costs on a line item basis to more effectively manage company revenues.

 

That's Why You Need a Line Item Budget

Effective business money management tips include effective asset allocation across all sectors of the business, regardless of the size of that business. A line item budget, created with input from department managers, your accounting team, previous quarterly P&L statements that identify trends in increased or decreased expenses, and input from employees actually "doing the job" enables business owners to develop a realistic budget based on where the company has been, and where the company is going in the future.
 
A line item budget better enables you to create a money management strategy that can be implemented without negative effects on product quality or delivery of services.
 

Increase Cash Flow

Cash moves through a growing business, from receivables to payment of fixed expenses, to savings to create contingency funds or to fund an expansion that adds value to the company – a key component of business success.
 
Talk to your bank representative about remote deposit capture – the ability to deposit checks electronically right from your desk. This secure solution gives you faster access to funds and greater control over how your company manages its money by eliminating time-consuming tasks, such as preparing deposit tickets, and allowing multiple locations to deposit to a single account.
 
Another means of increasing cash flow is to offer customers and clients early payment incentives that save your clients money, while delivering cash to your business more quickly, and at lower costs. Electronic funds deposit is less costly to banks than a visit to the teller at the end of each business day, thus lowering the cost of banking.
 

Outsource Money Management

Many business owners have a full schedule from morning until they leave the office, which may be 9:00 PM. Often, business owners and managers simply don't have the time or experience to "crunch the numbers" to discover opportunities to lower operational costs and better manage company cash.
 
Accountants, tax attorneys, treasury management representatives and other authorities in business money management evaluate current company spending and identify opportunities to lower operational expenses without lowering levels of client care, or decreasing employee morale.
 
Maintain a close watch on small expenses such as petty cash money, purchase used office equipment, add payment gateways to increase the flow of cash through the enterprise, and consult an expert in treasury management best practices to review past spending patterns. Through the implementation of these simple money management tips, you will uncover opportunities to lower the cost of business operations and ensure that your business thrives.
 
Contact a Cadence banker to discuss how Small Business Treasury Management solutions can help you streamline operations, maximize cash flow and better manage liquidity.

 

This article is provided as a free service to you and is for general informational purposes only. Cadence Bank makes no representations or warranties as to the accuracy, completeness or timeliness of the content in the article. The article is not intended to provide legal, accounting or tax advice and should not be relied upon for such purposes.



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