If there’s one thing that entrepreneurs agree on across the board, it’s that owning a business can lead to a significant amount of stress. That comes from a wide range of areas, but a key source for many entrepreneurs is in the financial category. That’s because a business can’t stay afloat unless its finances are robust.
Dealing with stress stemming from accounting and financial services may challenge even veteran entrepreneurs. To understand how you can face and overcome these stresses, check out the following six strategies.
1. Send Invoices Promptly
When you perform work for someone or provide services to them, it’s important to send an invoice quickly so you can get paid faster. You should have the payment terms right in your initial contract, and always follow up if they don’t pay you in accordance with those terms. In addition, you should reconcile invoices frequently to catch any missing payments.
2. Create Long-Range Plans
To ensure that your financials are adequately funding your business, you need to create long-range plans as well as short-term projections. That means you should be forecasting out how much money you’ll be bringing in next year and the year after, not just for this calendar year. In addition, you should know your budgets for the foreseeable future so that when expenses arrive, you’re well prepared for them and you aren’t taken by surprise – which can be a big source of stress.
3. Bring on an Expert
If you are short on time, you may not be able to dedicate as much to your accounting services as you’d like. In this case, it could be a good idea to delegate that responsibility to someone else. If you have the resources to hire a full-time accountant, CFO, bookkeeper, and/or other financial staff members, this may help release you from the stress that’s inherent to handling these tasks on your own.
4. Outsource to a Pro
Not every company has the resources to hire an accounting team, and in these cases, your best bet may be to outsource your accounting services to a company that specializes in the field. Not only can they create projections, handle your accounts payable/receivables, take care of taxes and deal with accounting issues, but they can help you stay organized financially so you always have a firm picture of where you stand. This can take a lot of the stress off of the business owner by knowing that the financial services are in the hands of an expert.
5. Optimize Technology
Not every accounting task has to be handled manually. In some cases, you can take on accounting and financial services in a digital way by optimizing technology. Using professionally created spreadsheets, high-tech software and even robot process automation (RPA) can allow you to make your processes more efficient and save some time, which ultimately leads to a lower stress level.
6. Confirm Compliance
Nothing is more stress-inducing for an entrepreneur than an accusation of noncompliance, either from government entities like the IRS or from local municipalities. To ensure that you don’t face the time-intensive process of having to correct compliance mistakes, make sure you have an expert ensuring that you are remaining compliant in every aspect of your business. This will save you the trouble of having to pay fines or chargebacks, and will keep your business running smoothly.
About the Author: Hemant Grover is a senior manager with Escalon Services, where he specializes in accounting, record-to-report, order-to-cash, procure-to-pay, and process mapping, as well as other essential business functions.