Does Your Business Need a Savings Account Too?
Although not nearly as ubiquitous as business checking, business savings accounts are becoming more and more popular among forward-thinking entrepreneurs.
There are millions of businesses in the world today that sell a wide range of products and services.
When looking at the most successful, what key characteristics do they all share? Two main aspects make these businesses stronger than the rest. These businesses have a strong understanding of their business finances. They know exactly how they make money, where they spend their money, and how much they keep. Secondly, they have a plan to grow their business. They know where they’re going to get new money in the future. These two characteristics are paramount to building a successful business, large or small.
Small businesses like yours succeed or fail depending on how profitable you are
Mastering the basics of business finance is often overlooked. There are a few key terms necessary to make sure you’re set up for success. These terms are Revenue, Cash Flow, Income and Profit. Let’s use a fictional example of a business owner named Joe who makes and sells umbrellas.
Every business should have an income statement as it is the best tool to understand financial performance over a specific amount of time. These are regularly called profit & loss statements as well. Let’s break down what exactly is inside of an income statement and what it means.
Forecasting your business revenue and growth is paramount to the success of your business. It gives you the ability to have a clear line of sight into the potential future of your business. This planning will allow you to hire staff more appropriately and build an operational plan for the future.