Keeping organised in business

When you start up your first business, it’s easy to feel overwhelmed.

After all, you need to develop and build up a customer/client base and focus on that.

But if you do so while pushing aside basic issues of organisation and administration, then this will simply cost you time and money later.

I speak from experience, of course. :)

If there’s one area I never gave my fullest attention to, it’s my accounts.

While I generally had an idea of income and outgoings, I never took so much notice of the details. Even when I had a book keeper to set them up, I didn’t keep as close a look on the monthly summaries as I needed to.

However, as the time nears for me to buy my first property, and with the current change to my third - and hopefully properly useful - accountants, I’d decided recently to take a more hands-on approach and maintain the accounts myself for both.

The result has been eye-opening.

Firstly, I can already see that my business is not as profitable as it should be. More than that, I can already see which outgoings I can cut out, or pace to work better with a monthly budget.

Because I’m giving them my full attention, I’m going to be able to create a much more lean and efficient business.

The tragedy is, that if I’d have been as close to them now from the very beginning, I could have saved so much time. Accounts done as and when the invoices come in is easy, but trying to play catch up isn’t just time-consuming, it can be very stressful.

Added to that, my key business has spent thousands on costs that I could have avoided by watching out for them at the start.

The added advantage is that I can now set up budgets to specifically work on a monthly or annual basis, with set objectives to be reached - and can monitor these properly - rather than simply spending because I think the business needs it.

I’m not normally very disciplined at pushing myself to be organised - but that’s no excuse. Being in business has been a learning curve, and probably the most important thing I’ve learned is to be in total control of your admin and accounts from the very beginning.

I can see for myself that it’s cost me money - and profits - and additionally I’ve had to waste a lot of time devoting attention to matters I could have done on the fly. Perhaps worse, I’ve created a lot of unnecessary stress for myself in doing so.

So here’s a couple of tips for start-ups and new businesses:

1. Get an accountant from the start

Go on recommendations where possible, but don’t be afraid to ask questions, and don’t be afraid to look into issues they advice moving forward with, before you actually commit yourself.

2. Set time for accounting

Decide whether you’re going to do the accounts on the fly, or whether you’re going to set a specific time aside each day or week to keep up with it all. And once you decide on a system, stick to it with no excuses.

3. Keep an eye on costs

Really ask yourself whether you need to purchase something now, or whether you can leave it to think about. This is especially the case with big software purchases and investments. Do they really have to be now?

4. Set yourself a budget

Decide on general spending limits according to your monthly or annual budget, whichever is best to account with. And stick to it. If you’re going to go over budget, delay a purchase until the following month.

5. Keep an eye on tax liabilities

Business can and do go bust because they don’t keep an eye on their tax liabilities. Work with your accountant from the start on these, so you know where your safe limits are for tax purposes, not least when you look to draw and income from your business.

Of course, these suggestions may look simple and common sense. But it’s one thing to actually recognise that, and a different thing to actually implement them.

Failure to do the latter can simply cost you time and money and make your business more stressful to run.

Now, who really needs that when they’re running a new business?