Many entrepreneurs are obsessed with their main objective: selling products or services. Everything that comes with it… is often less fun – even though it’s part of the job. Money management is one of those things that many entrepreneurs don’t particularly like. Don’t get us wrong – everyone likes making money and seeing paid invoices come in. But making sure you have your numbers in order when taxes come or hunt down debtors that aren’t paying is less fun. In this article we give you three tips to make money management easier.
1. Get a good accountant with experience in the TECH industry
You might think “Accountants are expensive, I’ll just do it myself!” and that is obviously your right. But accountants have access to the best programs so they can do taxes way faster than you can. Why would you spend hours trying to get your paperwork in order … when you could outsource this to someone else who totally knows what (s)he’s doing?
Furthermore a good accountant can let you know if you’re spending too much, if debtors are late in paying your invoices – or if they aren’t paying them at all.
2. Make sure your bills are paid on time
It’s not fun if your accountant tells you you have one or multiple unpaid invoices. Liquidity is super important and you need to pay your bills too! That’s why it’s a good idea to have a trusted debt collection agency (Dutch: incassobureau) on speed dial. They can track down your debtors and even find out who hides behind difficult corporate structures. A debt collection agency always knows just what to do in every situation. They might send a bailiff, they might file for bankruptcy of your debtor, they might file to seize your debtor’s assets (Dutch: beslaglegging)…
Working closely with a trusted debt collection agency can help your business so much. You don’t have the stress of having to hunt down your debtors yourself and you know agencies go to the limit to retrieve your money. Make sure you don’t waste any time when you notice your invoices get ignored: if another entrepreneur’s collection agency files for bankruptcy for your debtor, you might be the last in the line to get paid!
3. Know how much money you need to save for the future
Everyone loves making money. Just make sure you save enough for when you have to pay your taxes (luckily your accountant can help you with that!), but also make sure you save for your long-term goals.
A lot of young businesses fail because there isn’t a good business plan. If you have a solid business plan, you know how much money you need to make to e.g. expand and move to a different venue or hire new employees. Make sure you’ve written down your goals and always save a lot so you can survive a rough patch, in case something happens! For instance: the pandemic had a big impact on many businesses, so it’s good to have some money saved for emergencies.
Good luck with your business!