How To Manage Your ECommerce Finances
The responsibilities and processes involved in managing your eCommerce business are easier to understand when broken down into individual steps. Here are some of the practices you can use to manage your finances day to day effectively:
Understand The Incomings And Outgoings For Your Business
Before you get into budgets and financial planning, step one for your eCommerce business is having a clear understanding of what is going in and out of your company. From investing in stock to the income you bring in from sales, you should have a clear record of where everything stands. If you haven’t already, opening a business bank account can be a good starting point to clarify income and outgoings for your business.
Utilise The Right Software For The Job
Unless you’re extremely comfortable with coding and compiling spreadsheets, most Australian businesses utilise bookkeeping software and tools to manage their finances. There is a range of options out there, from Xero to QuickBooks, that offer free trials, so don’t be afraid to shop around to find the software that works best for you.
Plan Your Budget And Future Spending
Looking ahead in your finances is a must to help your business grow and continue to profit. Forecasting where you’ll spend money in the future, creating budgets, and looking at the return on investment for any spending can give you a stronger idea of where your money needs to go.
Regularly Track And Maintain Your Finances Ready For Tax Season
One of the most important financial skills you can have is discipline. As a task that often falls through the cracks, it’s vital that you do your due diligence in keeping all financial information up to date. This requirement is essential when tax season rolls around, as well-maintained records can save hours and potentially days of your time.
Evaluate And Examine Ways To Improve Your Finances
Looking at your past finances, analyses and reports can effectively inform the next steps your business should take. By having a good overview of what has been successful for your company financially, you can inform future plans and make effective decisions. Having a dashboard or regular report that gives you a clear overview can support your financial management.
Invest In Payroll As You Grow
If you’re currently the sole individual within your business, you likely haven’t put much through into payroll. But as your company grows and you hire extra workers, whether just during busy periods or year-round, you’ll also need to manage the finances involved in payroll. Investing in the right software or the support of a specialist company can help make the transition to payroll far easier.
How To Keep On Top Of Your Ecommerce Finances
Are you concerned about keeping on top of your finances alongside all your other business responsibilities? Here are some of the key ways you can ensure you never fall behind:
1. Set Aside Scheduled Time For Day-To-Day Management
The busier your day is, the easier it is to forget about your finances. To avoid playing catch-up at a later date, set aside a couple of hours a week to dedicate entirely to your finances. The more time you put in now, the less you’ll have to scramble to catch up later, especially if you’re close to tax season.
2. Put Finances First In Business Planning
Your finances are necessary to provide budgets to inform future plans for your business. If you want to expand or bring on a new product, you should first look at the finances to figure out whether it’s feasible for your business right now. By putting finances first, you’ll never be left on the back foot.
3. Work With A Professional Accountant To Handle Your Finances
If you haven’t got the time or capacity to handle finances in-house as your business demands grow, that’s where professional help is the ideal solution. Working with a qualified accountancy service or financial advisor can help put your money on the right track. If in doubt, leave your finances in the hands of the professionals.