Among the many hats small business owners wear, one of the most challenging is that of CFO. In a recent Intuit survey, 25% of small business owners listed “paying my bills” as the top concern that keeps them up at night. Additionally, cash flow (33%) and financial planning (24%) were the top two concerns among North American small business owners in Visa’s 2012 Small Business Cash Management Survey. Keeping track of what’s coming in versus what’s going out can easily be managed by remembering the three C’s:
Many small business owners associate poor cash flow with declining sales, yet that isn’t always the case. In fact, fast-growth companies can be especially vulnerable. Maximizing income while keeping expenses under control is vital; accepting and using electronic forms of payment can help. According to Visa’s 2012 Cash Management Survey, 75% of small business owners found electronic payments improved cash management processes – an increase over 2010 when 59% of small business owners recognized the benefits. A few other simple tips to help you manage cash flow include:
A critically objective viewpoint is paramount to running a healthy business. Attention to detail and knowledge of your company’s operations are essential. As a small business owner, you need to have control of your environment, but you also need strong control of inventory and spending. Take a look at your monthly expenses and search for cuts that can be made without harming the business. When it comes to growth, exercise caution and add employees slowly. Finally, don’t go overboard on inventory by buying more than you need. This can deprive your company of valuable cash.
Time is money and often in short supply for the entrepreneur wearing multiple hats throughout the day. Small business owners need convenient technology to help boost efficiency. More than 370 million hours are saved by small businesses that use mobile apps to help manage their operations, and another 725 million employee hours are saved annually with the apps, according to a study by the Small Business and Entrepreneurship Council.
These three simple “C’s” may seem like common sense, but they can easily be overlooked in the whirlwind of your business day. Keeping a keen eye on cash flow, spending controls and adopting convenient measures are sure ways to stay focused on running a sustainable business.
 Survey conducted online by Survey.com in May 2012; n=600 small business owners in the United States and Canada with annual sales less than $25 million.