How often do you look over your company’s books and wonder where all the money went? You should never be in the dark about what you’re spending, but the sad truth is many business owners are wasting money without even knowing it.
If you’re really serious about growing your business, stop making these common spending mistakes:
Using a bad record-keeping system.
You can’t expect to know what’s happening with company money without complete visibility of every expense. Take a look at your record-keeping system. Is it straightforward and easy to maintain or is it a complete mess? If you’re staring at a bunch of receipts in a folder and feeling guilty, it’s probably time to upgrade.
Accounting software puts payments, income, invoicing, payroll, and a bunch of other budgeting tasks together in one place and integrates with your bank account to pull transactions as soon as they occur. You still need to input purchases you make with cash and ensure transactions are properly categorized, but for the most part, the right accounting software makes keeping records a lot easier. Look for a platform with reports you can review regularly to confirm you’re staying on track.
Forgetting to monitor prices.
It’s easy to get into a routine with purchases and payments and forget about the power of shopping around. Prices on essentials like utilities, phone lines, and internet change over time, and the vendors you’re using now may not always offer the best values. Checking for better prices takes time, which is why a lot of business owners are reluctant to do it, but it pays off in the end.
Make a list of the essentials your business needs on an ongoing basis and compare current suppliers to other options. If you find a superior deal, you can either switch or use the information to negotiate lower prices on what you’re already buying. Vendors don’t like to lose customers and may be willing to match or even beat competitors’ rates to get you to stick around.
Not making payments on time (Whoops.)
Everybody misses a payment deadline now and then, but making a habit of it is a surefire way to mess up your budget. Late fees can add up, especially if you’re juggling utility bills, vendor invoices, credit card statements, and subscription services.
Stop these fees from interfering with your cash flow by using automatic payments wherever possible and ditching unnecessary recurring expenses. One easy way to save a bundle is to switch to a free credit card reader instead of leasing one. Depending on your current processor, this simple change could slash spending by hundreds or even thousands of dollars per year.
None of these changes are difficult or earth-shattering, so you really have no excuse not to take a look at your spending. As you tweak your budget, you’ll probably find other unnecessary expenses to cut and wind up saving even more! Stick with your new spending plan to free up cash so you’ll have it on hand when you’re ready to invest in the growth of your business.