Bookkeeping challenges can continuously bring critical issues to your business. Business owners have to put on all different sorts of hats from manager to accountant to security. Other tasks can also include marketing, hiring and firing, dealing with customers – all before you can even begin to track your costs and profits. Keeping your books organized is critical for the survival of your business. Below we will show you the major challenges your business will face and how to face them.
1. Unplanned Expenses
You’ve counted every penny. You know exactly what you will make, what to spend it on, and how much you can keep for yourself. Then the worst happens: a major unplanned expense. This can be the range breaking down at a restaurant. A piece of equipment malfunctioning at a plant. It can even be a natural disaster. These types of costs can wipe out a business’s profits in a single event. It is essential to stay ahead of them whenever possible.
Solution: For example in the case of restaurant or plant, get to know your most expensive pieces of equipment, their maintenance schedule, warranty, and other details. No one can plan for natural disasters. You can make sure your business is insured for the most likely natural disasters that could befall your location. Here in Houston, it is usually flooding, storms, and related issues.
2. Fluctuating Cash Flow
Your business may operate on anything from a client to client basis – like a restaurant. Or your business may have a steady flow of customers who pay a fee on a regular basis – like a gym. However, your cash flow is always up in the air. Sales increase and decrease on a regular basis.
Solution: There is no one size fits all solution. Managing your cash flow involves correctly earmarking assets to cover your recurring costs with other costs going towards the growth of the business. It is important to expertly analyze your expenses to maximize your benefit from them.
3. Taxes
You know you have to pay them. You may even know your rates for the coming year. But are you in compliance with all tax regulations in the federal, state, and local arena? Few business owners do. Everything from property tax to payroll tax and beyond can be full of costly hazards, not to mention the questions you will inevitably have when it comes to items like:
- How to deal with contractors.
- Which expenses can you write off?
- What credits can you take and for how much?
- How to prevent or deal with an audit.
- And many others.
Solution: Get help. No matter what the size of your business. Any tiny mistake can end up costing you far more than what a qualified expert would cost to prepare you to deal with taxes.
4. Plan for the Future
Once your books are in order, perhaps while filing your taxes, you have only dealt with half the issue. You must know the actual meaning of those numbers. This includes deciding which parts of the business are best to invest in, which expenses to cut or eliminate, and everything in between.
Solution: It is best to objectively, yet intensely interpret and analyze these numbers in order to make the best decisions. Gather a team of trusted advisors to help you analyze your data to develop a plan.
Help for Houston Bookkeeping Challenges
Contact us if your Houston based business needs help facing these and other bookkeeping challenges.
