Technology has let us do some incredible things—from landing an SUV on Mars to ordering a pizza in our underwear—but did you also know that technology can help your small business be more efficient overall? By utilizing modern technology and automating some key processes of your small business financial management, you can not only cut costs, but more importantly drive a more effective business as a whole. Automation often carries with it many negative connotations, especially within the small business community, for we tend to think of it as costing people jobs. In reality though, automation (if done correctly) can actually allow you to free up your employees and assign them to more valuable tasks within your business. Furthermore, many of these automated services offer benefits and expert advice that you would otherwise not be able to receive on your own. We live in a world of unprecedented possibility, a world where small businesses no longer must sit idly by and watch from the sidelines as these larger companies use sophisticated software and technology to maximize their efficiency. The technology is there, and now even cheaper than ever—it would be a shame to waste it. To help you, here are 4 easy and effective ways to automate your small business financial management.
Why You Should Automate Your Small Business Financial Management
Manage Your Receivables
With 15 to 20% of all receivables in the US being delinquent, it is no surprise that 1 in 4 small businesses have enormous trouble collecting payments from their customers. For small businesses, every penny counts, but unfortunately it can get quite expensive to actually get the money that your business already earned—from collection agencies, to credit checks, to monitoring your customers. For years, larger corporations with hefty multi-million dollar budgets have used advanced financial services that did all these tasks for them, but with today’s advancements such automated services are available for small business financial management as well. By automating your receivables management, not only will you be able to ultimately cut the costs associate with getting paid, but also transform collecting payments into a much more enjoyable process—for both you and your customers. Collection agencies carry some harsh wind and can actually create more harm than good in regards to your business’ brand equity. Automated services that do initial credit checks, monitor customers, as well as perform electronic invoicing, will all but eliminate the need for those infamous collection agencies. This ultimately will translate into your business receiving much more of its hard earned money, while at the same time not hurting the relationship you have with you customers. Getting paid can be a nasty business, but it doesn’t have to be anymore.
Utilize Online Banking
Almost every major bank today offers online banking services, and they can be a great way to significantly cut down transaction time, while at the same time granting you some added benefits. By going paperless, you can efficiently manage all of your accounts, seamlessly transfer money, set up automatic bill paying and most importantly keep a full record of all your transactions in one secure place. While most banks do have online services, they are all a bit different, so you must find the one that best fulfills your business’ needs. With online banking though, you must be a bit careful and do your research, for as the New York Times reported last year, some services almost bind you to that bank and make it almost impossible to switch. Still, shifting online can definitely save you a lot of time and hassle when it comes to dealing with your small business financial management.
Receive Payments Online
Making it easier for your customers to pay is always a good thing and with automated services like PayPal, you will easily be able to receive payments from your customer 24/7. As Entrepeneur.com reported, such online payments systems will also allow you to collect valuable information about your customers that will help you better your entire business overall.
Digitize Your Payroll
By using software that automates and manages your whole payroll process, you can not only more easily pay all of your employees but also cut a large degree of the costs associated with it. As Natalie Grace pointed out, the IRS and Department of Labor require employers to keep employment tax and payroll records for a minimum of 3 and 4 years respectively. Just to maintain these records alone in the office would be rather expensive, for it would mean that someone in your office has to actually maintain these files by hand (not to mention deal with all the other countless things associated with paying employees)—obviously that is valuable time and money that could be devoted to other, more pressing needs.
While often having a negative stigma, automation, if used correctly, can make a huge impact in your small business financial management—allowing you to both cut costs and focus on the parts of your business that you are best at. Time can be as much an asset as those little green rectangles in your wallet, so why waste it on tasks that could be done even better and cheaper through automating your small business financial management.
This post was written by Arie Hefter.