“If you want the rainbow, you have to put up with the rain.”
This quote from Dolly Parton can apply to so many things in life- especially small business owners! So many entrepreneurs have grand visions in their heads and expect grand payoffs to match but…you have to put in the work and the time to get the rewards.
One of the main mistakes business owners make, is ignoring or mismanaging their Accounts Receivable. On the front end, being clear about payment terms, will set the tone with your clients. Have it on each invoice and/or in contracts and have a good system in place to track who is behind and how far behind! A good accounting software, will help you do this.
Another big mistake is lack of planning and organization. For most business owners, recordkeeping can be a time consuming pain in the neck and not their strong suit. Not accurately tracking you income and expenses can cost you in many ways. If your accounting isn’t up-to-date, you may not realize you’re losing money! You may also owe more money in taxes because you haven’t tracked all of your deductible expenses. If you don’t have the time to track your income and expenses, you need to have someone do it for you! You could be losing lots of money by not having a handle on your books.
Small business owners wear so many hats and do so many jobs. They are constantly working through the rain to get to that rainbow! Just be sure to be mindful of your bookkeeping and do not let it be forgotten. Tax time is a good reminder that this is important year round!
Jordan Ilderton, CPA