As a small business owner, you’re likely an expert in whatever your company specializes in – a clothing retailer likely knows a lot about the latest fashions of the day, while a sporting goods store owner can probably speak at length about various major league sports teams.
All too often, however, small business owners aren’t as well-versed in the various financial considerations required for the successful day-to-day management of their businesses.
While you might have a basic understanding of payroll, balance accounts payable and receivable and so on, the details of how to effectively manage these things may elude you. What’s more, even if you are aware of the financial responsibilities on your shoulders, you likely don’t have the time to contend with all of the tasks.
With so many balls in the air, it’s perfectly understandable that you can’t always find the time needed to take care of your small business’ financial obligations.
However, if you can better understand and identify which financial management tasks eat up the most time, you’ll be in a stronger position to mitigate the amount of time spent on those things, and instead focus on other crucial business tasks.
Know What Your Time Is Worth
Financial management can be a huge drain a small business owner’s productive time during the day. Not surprisingly, a Mavenlink infographic revealed that 38 per cent of leaders rank time as the most valuable asset to their company, ahead of the second-most common answer, computers, at 36 per cent.
Moreover, a quarter of those polled by Mavenlink said that they would pay upwards of $500 just to add one extra hour to their work day.
More than 40 per cent of respondents said that of all the roles they have to fulfill as a company owner, they enjoy acting as an accountant the least.
Your time is very valuable – both to the future growth of your business and to you personally. By recognizing the true value of your time, you can make more informed decisions about how you spend it in your business.
Take a Hard Look at How You Spend Your Time
One of the most demanding tasks on a company owner’s docket is overall financial management, which can apply to everything from invoicing to calculating cost flow. According to a Sage Simply Accounting and Angus Reid report (PDF), small business leaders spend an extended amount of time taking care of these blanket responsibilities every week.
The study revealed that in most startups the owners tackle these tasks themselves, which take an average of 6.8 hours to complete every week. Respondents to the survey said that in a perfect world, they’d be spending half that time on finances.
However, during certain times of the year, the number of hours spent accounting can skyrocket. A PricewaterhouseCoopers study issued in May 2013 found that the average Canadian company takes 131 hours every year putting aside pertinent records and subsequently filing tax returns.
By understanding how much time you’re spending on these business tasks, you can make better decisions about what to automate, delegate or outsource.
Save Time with the Right Tools
The Sage and Angus Reid report noted that the leaders of many larger companies contract employees to contend with these tasks, and the majority also provide workers with accounting software to get the job done.
Even if you don’t have the resources to hire employees to handle these tasks for you, you’ll find that many accounting software options can be easily be navigated by non-experts.
And as a small business owner, financial software can help you contend with and trim the time spent on accounting tasks. By standardizing and automating many of the tasks, you’ll improve the efficiency of your usual accounting processes and lift some of these tedious responsibilities off of your shoulders.
Ultimately, you likely didn’t start a business to become an accountant. By implementing tools to help support you in the financial management of your company, you’ll have more time to focus your energy on what matters in your business.